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Video Q&A
0-15 min
Economics

The Second Bank of the United States

OVERVIEW

This video assignment combines history and economics and summarizes the debate in the United States over the creation of the Second National Bank in 1817.

After the charter of the bank of the United States expired in in 1811 what happened next? You know what happened, tell me. With pleasure. The war of 1812 against Great Britain left the United States once again in debt. But we had no national bank and that made the governments financial situation more even more difficult. Some influential people thought a new national bank will stabilize our currency and help finance the war debt but it still took years. Finally in 1816, President Madison signed a bill authorizing the second bank of the United States. So, how much are you looking to borrow? Well my new iron works will be run on entirely on water power. The second bank operated much like the first bank. It had many branches, it was a banker to businesses and individuals. It was the governments fiscal agent. Receiving its revenues, holding its deposits and making its payments. It also helped finance westward expansion. And then in 1829 Andrew Jackson became President. Partly because of a bad financial experience he'd had, Jackson was on the side of those who opposed the bank. He withdrew the state government funds and transferred them to state chartered banks. Then in 1836 the banks charter expired it was not renewed. After that the United States was without a central bank for more than 75 years. Until after the Federal Reserve Act was passed in 1913.

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