The American Banking System from 1800-1810 Essay -- Banks Finances Mon

The American lingoing System from 1800-1810Looking back to the origin of the 19th century, it is impossible to say that any real banking system had genuinely been developed in the US. This is to say that, though there were roughly long hundred private commercial banks that had been chartered by new extract governments, the alleged(prenominal) system was scarcely organized. It was ad hoc in nature and directly relate to the merchant banking practices of the pre-independence percentage point. The years preceding the turn of the century were important because they brought a central banking authority onto the scene. In 1789 the new federal government naturalized a position for the Secretary of the Treasury. As we know, the first to hold this reputable title was Alexander Hamilton. He accomplished a great circle in the 11 years leading up to the year 1800. near notably his actions were badly responsible for the creation of the First Bank of the linked States, which was given a charter in 1791. This thrust towards central banking was still to last 20 years, however. Up for review in 1811, the banks charter was not renewed. This paper will argue that the failure to renew the First Bank of the unify States charter was a direct result of the strong ideological differences between state focus on and federalist politics. Many were very skeptical about a strong alter banking system, while others believed that the only way to create unity in the arena was through a highly focused central banking system. Despite the congenator efficiency of the First Bank of the United States, and despite the fact that it is wide considered to be a success by economic historians, the general scruple of banking led to its demise. In other words, this paper will argue that the 1800-1810 period was unmatched of exhaustive tension between centralists and de-centralists. This had important and lasting effectuate on the banking system, the most obvious being that, in the foll owing century, state banks proliferated to the point where they were chartered with abandon. As John K. Galbraith noted, every location large enough to have a church, a tavern, or a blacksmith break was deemed a suitable place for setting up a bank. These banks issued notes, and other, more than surprising enterprises, imitating the banks, did likewise. Even barbers and bartenders competed with banks in this respect (Flaherty, 1997 http//odur.let... ...institution, and based on the hot conflicts between Madison and Hamilton over state vs. federal power, the bank itself became politicized. As state-led forces increased their popularity, it is wholly unsurprising that the First Bank of the US was one of the first things to go. ReferencesDeCarolis, Lisa Marie. The Precipice of Power <http//financeservices.miningco.com/business/financeservices/gi/dynamic/offsite.htm?site=http//www.jmu.edu/polisci/capital of Wisconsin/hamil19.htm%23Origins>(accessed 12-12-99)Del Mar, Alexander. H istory Of Monetary Systems Chapter XVII Bank Suspension Since The Era Of hush-hush Coinage History of the World, 01-01-1992 Foner, Eric., Garraty, John A (eds) Banking The Readers consort to American History, Houghton Mifflin New York, 1991., pg. 191Flaherty, Edward. 1997. A Brief History of Banking in the United States <http//odur.let.rug.nl/usa/E/usbank/bank03.htm> (accessed 12-12-99)James Madison Debates the Constitutionality of a National Bank <http//financeservices.miningco.com/business/financeservices/gi/dynamic/offsite.htm?site=http//www.jmu.edu/polisci/madison/hamil19.htm%23Origins> (accessed 12-12-99)