Events
1791 Bank of the US
-signed by President Washington
-This bank collected fees and made payments on behalf of the federal government.
-Bank went away because state banks opposed it; thought it gave too much power to national government1816 Second Bank of the US
-Second Bank of the US was chartered in 1816.
-Failed because it didn’t regulate state banks or charter any other bank
-State banks were issuing their own currency
-Federal government didn’t print paper currency until the Civil War1863 National Banking Act
-Banks could have a state or federal charter (duel banking)1913 Federal Reserve Act1930’s Great Depression (regarding banking)
Great Depression caused banks to collapse
FDR declared a “bank holiday” where banks closed
Only allowed to reopen if they proved they were financially stableGlass-Steagall Banking Act 1933
Established the Federal Deposit Insurance Corporation
Ensures that if a bank goes under, you still have your money1970's
Congress relaxes restrictions on banks1982
Congress allows S&L banks to make high risk loans and investments
Investments went bad
Banks failed
Federal government had to give investors their money back
Federal government debt: $200 billion
The FDIC took over the S&L1999 Gramm-Leach-Bliley Act
Allows banks to have more control over banking, insurance and securities
Cons: less competition, may form a universal bank; may lead to more sharing of information (reduction of privacy)
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