may 30, 1908 - Aldrich–Vreeland Act

Description:

The Aldrich–Vreeland Act, passed in response to the Panic of 1907, established the National Monetary Commission, which recommended the Federal Reserve Act of 1913.

Senator Nelson W. Aldrich (R-RI) was largely responsible for the Aldrich-Vreeland Currency Law and became the Chairman of the National Monetary commission. The co-sponsor of the legislation was Representative Edward Vreeland, a Republican from New York.

A usage of the law occurred at the outbreak of World War I in 1914 when the first great financial panic of the 20th century befell the world, necessitating the closure of the New York Stock Exchange. Secretary of the Treasury William Gibbs McAdoo appeared in New York City and assured the public that ample stocks of emergency banknotes had been prepared in accordance with the Aldrich–Vreeland Act and were available for issue to the banks. As of October 23, 1914, $368,616,990 was outstanding.

The Federal Reserve Act of December 23, 1913 took effect in November 1914, when the 12 regional banks opened for business. Ultimately, the emergency currency issued under the Aldrich-Vreeland Law Act was entirely withdrawn.

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