In 1791 the First Bank of the United States was established by Congress at the urging of Treasury Secretary Alexander Hamilton. The bank had a twenty year charter, and it was not renewed by Congress in 1811.
In 1816 Congress agreed to a twenty year charter for the Second Bank of the United States. Andrew Jackson who was an opponent of the central bank was elected President in 1828. President Jackson vetoed legislation to renew the Second Bank of the United States, and when the Second Banks charter expired in 1836 it was not renewed.
The National Banking Act of 1863 was passed during the Civil War. It provided for nationally chartered banks whose circulating notes had to be backed by U.S. Government securities. An amendment to the act required taxation on state bank notes but not national bank notes.
IN 1893 bank runs and financial panics triggered the worst depression the U.S. had ever seen. Financial mogul J.P Morgan intervened and stabilized the economy.
J.P. Morgan again intervened after a particularly severe banking panic in 1907. There was clearly a need for banking and currency reform.
The Aldrich-Vreeland Act of 1908 provided for an emergency currency and established the National Monetary Commission to study banking and currency reform. The chief of the bipartisan National Monetary Commission was financial expert and Senate Republican leader Nelson Aldrich.
In 1912 Democrat Woodrow Wilson was elected President. From 1912 to 1913 the Glass-Willis proposal by Virginia Rep. Carter Glass, who would become the chairman of the House Committee on Banking and Finance, and H. Parker Willis, the Committee's expert advisor and formerly a professor of economics at Washington and Lee University, was debated, reshaped, and modified into the Federal Reserve Act.
On December 23, 1913, President Woodrow Wilson signed the Federal Reserve Act into law.
Key laws affecting the Federal Reserve have been:
* Banking Act of 1935
* Employment Act of 1946
* Bank Holding Company Act of 1956 and the amendments of 1970
* Federal Reserve Reform Act of 1977
* International Banking Act of 1978
* Full Employment and Balanced Growth Act of 1978
* Depository Institutions Deregulation and Monetary Control Act of 1980
* Financial Institutions Reform, Recovery and Enforcement Act of 1989
* Federal Deposit Insurance Corporation Improvement Act of 1991
* Gramm-Leach-Bliley Act of 1999
In 2002 the Sarbanes-Oxley Act was passed:
President Bush Signs Corporate Corruption Bill
The basic structure of the Federal Reserve System includes:
- The Federal Reserve Board of Governors
The current members of the Board of Governors are:
* Ben Bernanke, Chairman
* Donald Kohn, Vice-Chairman
* Frederic Mishkin
* Kevin Warsh
* Randall Kroszner
- The Federal Open Market Committee
- The Federal Reserve Banks
|Federal Reserve Bank||Letter||Number||Website||President|
|Boston||A||1||http://www.bos.frb.org/||Eric S. Rosengren|
|New York||B||2||http://www.newyorkfed.org/||Timothy F. Geithner|
|Philadelphia||C||3||http://www.philadelphiafed.org/||Charles I. Plosser|
|Richmond||E||5||http://www.richmondfed.org/||Jeffrey M. Lacker|
|Atlanta||F||6||http://www.frbatlanta.org/||Dennis P. Lockhart|
|St Louis||H||8||http://www.stlouisfed.org/||William Poole|
|Minneapolis||I||9||http://www.minneapolisfed.org/||Gary H. Stern|
|Kansas City||J||10||http://www.kansascityfed.org/||Thomas M. Hoenig|
|Dallas||K||11||http://www.dallasfed.org/||Richard W. Fisher|
|San Francisco||L||12||http://www.frbsf.org/||Janet L. Yellen|
- The member banks
Federal Reserve Chairman Ben Bernanke delivers the Fed's Monetary Policy Report, Thursday, Feb. 28, 2008, during an appearance before the Senate Banking Committee.
Alan Greenspan was the 13th Chairman of the Board of Governors of the Federal Reserve, from 1987 to 2006. He was knighted in England in 2002.