Free Banking Era "WildCat" (dec 30, 1837 – aug 19, 1863)
Description:
~From 1830-1837 the number of state-charted banks tripled
~because of this many problems occurred
°Bank runs and panics - often banks would distribute paper money without having enough gold and silver to back it up causing a bank run making banks fail
-Bank run = great numbers of people try to redeem their paper money all at once
°Wildcat banks - these banks were located on the frontier earning the name because people joked that only wildcats only lived in such places. HIGH rate of failure since they were inadequately financed
°Fraud - a few banks would issue bank notes and would collect gold and silver from people who bought the notes then would disappear
°Many different Currencies - railroads, stores, private banks, church, and individuals were aloud to issue currency. The profusion of currencies made it easier to create counterfeits
Added to timeline:
The history of american banking
Date:
