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Concept
History of central banking in the United States
Summary
This history of central banking in the United States encompasses various bank regulations, from early wildcat banking practices through the present Federal Reserve System.
Bank of North America and Currency Act
Bank of Pennsylvania
Some Founding Fathers were strongly opposed to the formation of a national banking system; the fact that England tried to place the colonies under the monetary control of the Bank of England was seen by many as the "last straw" of oppression which led directly to the American Revolutionary War.
Others were strongly in favor of a national bank. Robert Morris, as Superintendent of Finance, helped to open the Bank of North America in 1782, and has been accordingly called by Thomas Goddard "the father of the system of credit and paper circulation in the United States". As ratification in early 1781 of the Articles of Confederation had extended to Congress the sovereign power to generate bills of credit, it passed later that year an ordinance to incorporate a privately subscribed national bank following in the footsteps of the Bank of England. However, it was thwarted in fulfilling its intended role as a nationwide national bank due to objections of "alarming foreign influence and fictitious credit", favoritism to foreigners and unfair policies against less corrupt state banks issuing their own notes, such that Pennsylvania's legislature repealed its charter to operate within the Commonwealth in 1785.
First Bank of the United States
In 1791, former Morris aide and chief advocate for Northern mercantile interests, Alexander Hamilton, the Secretary of the Treasury, accepted a compromise with the Southern lawmakers to ensure the continuation of Morris's Bank project; in exchange for support by the South for a national bank, Hamilton agreed to ensure sufficient support to have the national or federal capitol moved from its temporary Northern location, New York, to a "Southern" location on the Potomac. As a result, the First Bank of the United States (1791–1811) was chartered by Congress within the year and signed by George Washington soon after.
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