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First Bank of the US
In 1791, The First Bank of the United States was one of the four major financial innovations proposed and supported by Hamilton, first Secretary of the Treasury. In addition to the national bank, the other measures were assumption of the state war debts by the U.S. Government, establishment of a mint and imposition of a federal excise tax -
Second Bank of the US
The Second Bank of the U.S. was chartered in 1816 with the same responsibilities and powers as the First Bank. It failed because it didn't regulate statebanks or charter any other banks. -
The Civil War (Printing Money)
Congress decided to authorize Demand Notes to finance that was in 1861. From 1861-1865, Confederate Currency was being printed -
The National Banking Act
After the expiration of the Second Bank of the United States in 1836, the control of banking regimes devolved mostly to the states. Different states adopted policies including a total ban on banking, a single state-chartered bank, limited chartering of banks, and free entry. Banks could have a state or federal charter - called duel banking. -
The Federal Reserve Act
The Federal Reserve Act created a system of private and public entities. There were to be at least eight and no more than twelve private regional Federal Reserve banks. Twelve were established, and each had various branches, a board of directors, and district boundaries. The Federal Reserve Board, consisting of seven members, was created as the governing body of the Fed. Each member is appointed by the President of the U.S and confirmed by the U.S. Senate. -
The Great Depression (Regarding Banking)
As the economic depression deepened in the early 30s, and as farmers had less and less money to spend in town, banks began to fail at alarming rates. During the 20s, an average of 70 banks failed each year nationally. After the crash during the first 10 months of 1930, 744 banks failed. In all, 9,000 banks failed during the decade of the 30s. It's estimated that 4,000 banks failed during the one year of 1933 alone. By 1933, depositors saw $140 billion disappear through bank failures. -
The Glass-Steagall Act
The Glass-Steagall Act effectively separated commercial banking from investment banking and created the Federal Deposit Insurance Corporation, among other things. It was one of the most widely debated legislative initiatives before being signed into law by President Franklin D. Roosevelt in June 1933. -
1970's
The Stock Market was a mess, Economic growth was weak; which results in rising unemployment that eventually reaches double-digits. And the 1970's cause high inflation. With interest rates skyrocketing, many people are priced out of new cars and homes. -
1982
This was when Congress allowed Savings and Loans banks to make many high risk loans and investments. These banks ended up failing and the federal government had a debt of $200 billion. Between 1980-1994, a total of 1,617 commercial and savings banks failed. -
Gramm-Leach-Bliley Act
This act allows banks to have more control over banking, insurance, and securities. The cons to this act are less competition, may form a universal bank, and may result in reduction of privacy.