the bank of the united states and the american economy (1999)

[...]... capitalization of $200 million Part of this stock would be a foreign loan of $10 million The government would be a The Bank of the United States 8 partner in the bank by guaranteeing one-twentieth ofthe subscription money to the stockholders and would share half of the stock and profits of the bank Repayment ofthe investment at the end ofthe charter was to be guaranteed by the government in Spanish dollars in the. .. to the American economy The secretary of the treasury had realized that most people remained suspicious of banks, believing that they served primarily the interests of the wealthy At this time, the country had only three working banks, the Bank of New York, the Bank of Massachusetts, and the Bank of North America.7 In his "Report on a National Bank, " Hamilton enumerated the advantages of a Bank of the. .. Hamilton stressed how the Bank of New York could serve both the state and the nation by lending money to the government and funding infant industry and commerce However, the legislators were suspicious of all kinds of banks, and they refused to incorporate either the Bank of New York or the land bank. 71 Nonetheless, the Bank of New York opened for business as a private bank in June 1784, and it wasfinallyincorporated... the United States He explained how the bank would increase the services of gold and silver by issuing notes and honoring checks for the transfer of credit This enlarged the active and productive capital ofthe nation and enabled banks to become institutions of national wealth He pointed out that the use of banknotes quickened the circulation ofthe money supply and facilitated the payment of taxes The bank. .. knowledgeable on money and banking matters Since 1779, he had presented his banking plan four times and was one of the founders of the Bank of New York However, most important, he had convinced Washington that the purpose of the Constitution was to establish a workable government.33 THE ORGANIZATION AND OPERATION OF THE FIRST BANK OF THE UNITED STATES The First Bank ofthe United States opened on December... president ofthe United States Bank of Pennsylvania until his retirement in 1839 The United States Bank of Pennsylvania had suffered through the Panics of 1837 and 1839 Unfortunately, the Bank was not strong enough to survive the effects ofthe 1839 downturn, and two years after Biddle's retirement, it closed its doors for good 1 The Need for a National Bank Thefinancialproblems ofthe colonies during the American. .. House.23 The construction ofthe Constitution and not the bank had become the major issue for Madison Proponents ofthe First Bank ofthe United States rested their case on the power given in the Constitution in Article I, section 8, which enabled Congress to borrow money and lay and collect taxes They promoted the bank both as a private commercial bank and as a public or national bank, but not as a central bank. .. which was then the financial capital ofthe United States. 57 Morris looked upon the bank as his major achievement of the American Revolution He clearly detailed how the bank would help the nation; he hoped that it would last as long as the United States, and declared that it would "prove the means of saving the liberties, lives, and property of the virtuous part of America."58 He claimed that the government,... respects: the Federalists from the New England and Middle Atlantic states wanted no part of the Bank, though many ofthe Jeffersonian Republicans in the South became its supporters Though there was some opposition on constitutional grounds in 1816, the Bank' s main opponents were primarily businessmen and state bankers in the Northeast The Second Bank of the United States started out badly, due to the poor... had become secretary ofthe treasury It is the only bank, before the Constitution, that exists today under the same name.72 The Bank of Massachusetts, also formed in 1784, was the only other bank in the United States before the Constitution; it merged in 1903 with the First National Bank of Boston.73 THE ECONOMIC CRISIS LEADING TO THE CONSTITUTION The Bank of North America provided the government with . and the First Bank ofthe United States 19 3. The Period between the First and Second Banks 37 4. The Creation of the Second Bank of the United States 49 5. The Second Bank and the Panic. book tells the story ofthe First and Second Banks ofthe United States and how they functioned within the American economy. These Banks, acting as national and central banks, helped the government. editors Energy and the Rise and Fall of Political Economy Bernard C. Beaudreau The Bank of the United States and the American Economy Edward S. Kaplan Contributions in Economics and Economic