Federalists and Antifederalists disagree about a banking system
The First Bank Of The United States
1791 - 1811
The United States Treasury used the bank to hold the money that the government collected in taxes and to issue representative money in the form of bank notes, which were backed by gold and silver. The federalists believed that the country needed a strong central government to establish order. They were run by Alexander Hamilton who was Secretary of the Treasury in 1789. This bank would have the power to issue a national currency manage the federal government's funds, and monitor other banks throughout the country.
Panic of 1907
At this time many banks had to stop exchanging gold for paper money. People ended up losing their jobs because businesses could not borrow money to invest in future projects.
Federal Reserve Act
The Federal Reserve Act established the Federal Reserve System. It was Implemented to establish economic stability in the U.S. The Federal Reserve Act is one of the most influential laws shaping the U.S. Financial system. Signed by President Woodrow Wilson. It also established the 12 Federal Reserved Banks.
FDIC (Federal Deposit Insuurance Corporation)
FDIC stands for (Federal Deposit Insurance Corporation.)
It preserves and promotes public confidence in the U.S financial system by insuring deposits in banks and institutions by $250,000; by identifying, monitoring, and addressing risks to the deposit insurance funds; by limiting the effect on the economy and financial system. It was created in 1933 in a response of the bank failures that occurred in the 1920s. * Franklin D. Roosevelt.
The Saving and Loan Crisis
Had made long term loans at low rates of interest. At this time interest rates had went up which meant that saving and loans had to pay large amounts to their depositors. In 1989, congress passed legislation that essentially abolished the independence of the saving and loans industry.
Treasury secretary Henry M. Paulson, President George Bush, and U.S lawmakers organized a $700 billion bailout of banks, automakers, and wall street financial firms. The money was to help banks not go bankrupt.