2nd Bank of the United States by Jacob Redenbaugh and Jeremi Ann Sampelo 3A
2nd Bank of the United States
by Jacob Redenbaugh and Jeremi Ann Sampelo 3A
Causes of Bank Creation
Weak economy after the War of 1812
The First Bank of America's Charter ended
Causes of Bank Crisis
Panic of 1918
Viewed and feared the central bank's monopolistic power to benefit the North and financial elite
Concern that federal government funds mix with that of state banks
Believed the Central bank was unconstitutional
People feared national bank directors manipulated the nations financial system the advantage of the north.
Southerners and westerners preferred gold and silver coins over paper money.
Biddle's management facilitated business expansion and supplied a stable currency
The bank could create a stable economy by unifying the states
McCulloch v. Maryland declared the central bank was constitutional
Effects of Bank Crisis
Congress passed the bank recharter; Jackson's veto led to loss of support
State banks ("pet banks") had the benefit of federal deposits
Sparked speculations encouraged by government funds in pet banks (from Biddle's contraction policy)
Effects of Bank Creation
Stabilized the economy with common currency
Sparked debate in the Jackson era over the validity of a central bank.