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Banks Before The Civil War

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Imagining a time when a person could not take their money to the bank and have it processed, counted, and kept secure for them seems unfathomable. Dating back to the end of the Civil War in 1865, then up until 1879 there was an arrangement of knowledge that started banking practices that would influence future generations. The ideas that came about during these fourteen years were eventually formed into the National Banking System. (Friedman) There was an organization of money developed before this time, but nothing to the extent of what was beginning to take form during and after the United States entered the Civil War. Aside from minute changes, the configuration stayed largely the same. When the Civil War came to an end, the amount of national banks grew immensely. There was a decline in state banks near the end of the 1860’s, which led some people to believe that there was going to be an end put to national banks all together. This soon changed though and banks expanded their businesses. The National …show more content…

Some of these impacts may have been negative, while most have been positive. The Web is a great way to publicize and get a business’ name out, while not having to do much work outside the home or office. As stated before, it would be hard to find an industry that has not benefitted from the Internet, and online banking has had the most evident positive results thus far in history. (Stewart) As with all technological advancements, online banking starting out small, and has been growing ever since. Over thirty years have gone by since the start of taking banking to the Internet and there have been many situations that reflect it as a good thing, and then others opposing it as a bad idea. In all, the online industry continues to grow and advance each year with researchers coming out with new ideas to improve the banking

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People will want their money to be securely kept until they need it and if the bank is not safe they will remove it. An increase in bank failures during the last few months of 1930 generated widespread attempts to convert deposits to cash. People lost faith in the

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The Second Bank of the United States was chartered in 1816 for a term of 20 years. The Bank Recharter Bill in 1832 was a bill created to renew the charter of the Second Bank because of Jackson’s opposition. Nicolas Biddle was the owner of the Bank of the United States during 1812. He underestimated Jackson’s power and thought that Jackson would not trying to veto the Recharter Bill as Biddle introduced it to the Congress. However, Jackson had been distrusting the bank because before his career, he was damaged by the bank credit.

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In 1791, Treasurer Alexander Hamilton proposed the First Bank of the United States, also called the First Bank, which, with the necessary-and-proper clause, allowed the government to act on the four rights stated in the Constitution: “the rights to collect taxes, borrow money, regulate trade among states, and support fleets and armies.” The charter of the First Bank caused a debate that Secretary of State, Thomas Jefferson, a large opponent of a central banking system, later described as “the most bitter and angry contest ever known in Congress before or since the union of the states.” The intensity of it is conveyed in “Cabinet Battle #1” in Hamilton: An American Musical, in which the debate between Hamilton and Jefferson is recreated in

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When Jackson chose to eliminate the National Bank he had what was best for him on his mind and not what was best for the United States. The second National Bank was established in 1816 and had a charter set to expire in twenty years. The bank became very powerful and was good for the U.S. economy, “...it was the only bank permitted to have offices across the nation... The Bank of the United States also printed the country’s paper money” (Ember). Having these responsibilities, the bank became a very important part of the economy.

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235 Words | 1 Pages

Andrew Jackson By:Tyanne Moody My opinion is that Andrew did a good thing with the Philadelphia Bankers. Because with the way that they would charge the bank if they lost and kept the money when they won. They were just keeping it to themselves and if they didn’t catch them when they did then the bank would have owned more money than they already did. Andrew was the one to save Thousands of lives by catching the bankers.

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1125 Words | 5 Pages

After the time period between 1865-1900 which was also known as the Reconstruction Era, advancements in the industry began to become more efficient. There were many social and political reforms that occurred that applied to this evolution. During the 19th century there were many advancements that changed society like oil, steel, and electricity. Then, creating concepts of big business helps the foundation of the economy. However, the idea of Robber Barons became known as people who used extreme methods to gain wealth through their actions to become the best in the industry, impacting them to become greedy.

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The South opposed this, as this gave more power to the federalists, and were scared that the government was going to interfere with slavery, and that would gravely hurt their economy. Furthermore, Jackson argued that the bank supported the wealthy class and they only benefited from this, while the lower economic class wasn't favored at all. However, the North believed that the national bank should be open as that helps the economy of the United States. This is because the Bank would be able to give the government a short term loan to ensure financial stability and promote the economy by additional credit being deployed by the national bank. Jackson barely considered this idea in his mind and vetoed Clay’s bill to recharter the bank, as he believed in sectionalist ideologies and due to this he created pet banks.

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During the 1920’s there was a sense of a booming economy leading more people to buy on credit with the economy being stable. However after the stock market crash droves of people rushed to withdraw their money. This caused many problems for the banks as they had invested money into the stock market themselves, many closed down leaving millions questioning where their money had gone. This is the main reason people viewed banks as untrustworthy and feared giving them there hard earned money. This is why President Roosevelt created programs such as the FDIC to create a trust between the people and the government.

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“The Bank of the United States was established in 1791 to serve as a repository for federal funds and as the government’s fiscal agent. Initially proposed by Alexander Hamilton, the First Bank was granted a twenty-year charter by Congress in spite of the opposition of the Jeffersonians to whom it represented the dominance of mercantile over agrarian interests and an unconstitutional use of federal power.” (Bank of the United States, par. 1) The main supporters of the Bank of United States were the businessmen and those who were involved in industry.

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During the Civil War paper money had been made, but at the time it was not exchangeable for gold or silver. Congress had to decide wether or not to keep the paper money, get rid of it, or make it exchangeable for gold and silver. People had arguments on why they should do either option. The ones who voted to get rid of paper money or make it exchangeable feared inflation. Where the people who voted to keep paper money said there was not enough gold and silver to support a growing economy.

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575 Words | 3 Pages

After the Civil War, the United States had two distinct economies, which is quite significant. The Southern economy was completely damaged by the results of the Civil War. Southerners were forced to readjust their entire economy, because slaves needed to be liberated, leaving slave-owners with no workforce. Meanwhile, in the North, the need to supply Union armies with particularly daily supplies marked the start of an era of industrial development. Which giant corporations essentially emerged known as Big Business.

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923 Words | 4 Pages

The National Banking Act strengthened the Union economy and funded the war. It stabilized the Union economy by creating a centralized banking system, and successfully funded the war by decreasing federal debt and reducing inflation. If the National Banking Act had not been enacted, then the Union would not have had so much economic support for the war. Since the Confederacy’s strategy was to outlast the Union, they would have had better success if the Union did not have the strong economy and funding created by the National Banking

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961 Words | 4 Pages

The need for a national bank was very much so necessary. Hamilton also convinced president Washington to sign the bank bill by his lengthy report that stated: “This criterion is the end, to which the measure relates as a mean. If the end be clearly comprehended withan any specified powers, collecting taxes and regulating the currency, and if the measure have an obvious relation to that end, and is not forbidden by any particular provision of the constitution, it may safely be deemed to come with the compass of national authority.”

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510 Words | 3 Pages

This caused the new banks’ failure by issuing the Specie Circular order in 1836. The government land required payment to be in gold. The National Banks of United States collapsed, this caused what we know as the Panic of 1837, that Andrew Jackson’s successor had to deal with. This was much unorganized, banks got removed, etc. The lack of national banks was one of the many speculations that contributed policies that caused the market to crash in the year of 1837.

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The economically flourishing South transformed into an economically struggling area, while the North suffered as a result of the collapse of the banks. The Civil War and Reconstruction brought about many economic struggles to the United States and transformed the status of the South. The Civil War indisputably transformed the United States politically, socially, and economically. The 13th, 14th, and 15th Amendments sparked most of these changes in addition to the reunification of the Confederate states.

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