Search
  • Jeffrey Goldfarb

A Brief History of the Federal Reserve

Federal Reserve | Bank | Buffalo, NY | New Orleans, LA | Certified B Corp 

For the Historian on the move

With a rise in populism and a President who considers himself a modern day Andrew Jackson, perhaps now is a good time to reeducate ourselves on the Federal Reserve. After all, Andrew Jackson was the man who singlehandedly forced the collapse of America’s second attempt at a centralized bank.

The Revolutionary War ended in 1783 and it wasn’t until December 1913 that the Fed Reserve Act passed under President Wilson. During that 130 year period, there were two attempts at centralizing the bank, both failed when the government failed to renew their charters. During this time there was a general fear of a centralized bank. After successfully gaining their independence from the British Empire, the vast majority of Americans feared any semblance of a strong centralized government; it seemed like a slippery slope back to tyranny.

The first attempt of a central bank, the First Bank of the United States, located in Philadelphia had a twenty year charter starting in 1791. Though popular among Federalists, their strong opposition successfully blocked renewal of the charter. The second failure is a part of President Andrew Jackson’s legacy. Jackson considered any aid to banking as a direct attack to his populist position and vetoed the charter.

Without a centralized bank, regional and state banks created their own notes. There was little to no uniformity.

After the crash of 1893 and 1907 the need to centralize banking entered the forefront of political debate. The unregulated market created competing monopolies, which could game the economy. In 1907 a failed attempt to take over the copper market triggered a panic. In three weeks markets shrunk 40%. Without a centralized bank, the regional and state run lenders had a liquidity problem. Reserves ran dry and banks had to rely on men like J.P. Morgan to keep the economy afloat.

This led some of the harshest critics, like Nelson Aldrich, into advocates for a centralized bank. In 1910 the famous secret meeting on Jekyll Island took place. Nelson Aldrich came out of the meeting with a bill to create a central banking system.

Though this bill was rejected, it did influence the successful Owen-Glass Bill (Federal Reserve Act). The Act was signed and put into law by Woodrow Wilson in 1913, and that is the pocket-sized history of the Federal Reserve.


References for this article:

  1. America’s Bank by Roger Lowenstein

  2. https://www.federalreservehistory.org

Views expressed are the opinions of Jeffrey Goldfarb and the Financial Advisors at Goldfarb Financial and not necessarily those of Raymond James. Links are being provided for information purposes only. Raymond James is not affiliated with and does not endorse, authorize or sponsor any of the listed websites or their respective sponsors. Raymond James is not responsible for the content of any website or the collection or use of information regarding any website’s users and/or members.

9 views
 

Subscribe Form

(716) 842-0145

295 Main St Suite 914 Buffalo, NY 14203

900 Camp St Suite 4C5 New Orleans, LA 70130

  • Facebook
  • YouTube
  • LinkedIn
  • Twitter

Raymond James financial advisors may only conduct business with residents of the states and/or jurisdictions for which they are properly registered. Therefore, a response to a request for information may be delayed. Please note that not all of the investments and services mentioned are available in every state. Investors outside of the United States are subject to securities and tax regulations within their applicable jurisdictions that are not addressed on this site. Contact your local Raymond James office for information and availability. Links are being provided for information purposes only. Raymond James is not affiliated with and does not endorse, authorize or sponsor any of the listed websites or their respective sponsors. Raymond James is not responsible for the content of any website or the collection or use of information regarding any website’s users and/or members. Raymond James Financial Services is not affiliated with New Orleans Chamber of Commerce.

https://brokercheck.finra.org/

Securities offered through Raymond James Financial Services, Inc., Member FINRA/SIPC Privacy Policy</a/<a

Goldfarb Financial is not a registered broker/dealer and is independent of Raymond James Financial Services, Inc. Investment advisory services offered through Raymond James Financial Services Advisors, Inc.

Certification awarded by an independent nonprofit organization B Lab. This certification recognizes businesses that meet rigorous standards of social performance, accountability and transparency. The 2019 Best for the World lists are determined based on the verified B impact Assessments of Certified B Corporations. The B Impact Assessment (BIA) is a free Online tool designed to comprehensively measure the positive impact that businesses generate for their communities, customers, workers, and environment; administered by the independent nonprofit B Lab. Criteria can be found at https://bcorporation.net/2019-best-for-the-world. The ranking may not be representative of any one client’s experience, is not an endorsement, and is not indicative of the firms’ or the advisor’s future performance. Neither Raymond James nor any of its Financial Advisors pay a fee in exchange for this award/rating. B Impact and Best for the World is not affiliated with Raymond James.

We receive, collect and store any information you enter on our website or provide us in any other way. In addition, we collect the Internet protocol (IP) address used to connect your computer to the Internet; login; e-mail address; password; computer and connection information and purchase history. We may use software tools to measure and collect session information, including page response times, length of visits to certain pages, page interaction information, and methods used to browse away from the page. We also collect personally identifiable information (including name, email, password, communications); payment details (including credit card information), comments, feedback, reviews, recommendations, and personal profile. When you conduct a transaction on our website, as part of the process, we collect personal information you give us such as your name, address and email address. Your personal information will be used for the specific reasons stated above only. We collect such Non-personal and Personal Information for the following purposes: To provide and operate the Services; To provide our Users with ongoing customer assistance and technical support; To be able to contact our Visitors and Users with general or personalized service-related notices and promotional messages; To create aggregated statistical data and other aggregated and/or inferred Non-personal Information, which we or our business partners may use to provide and improve our respective services; To comply with any applicable laws and regulations. All direct payment gateways offered by Wix.com and used by our company adhere to the standards set by PCI-DSS as managed by the PCI Security Standards Council, which is a joint effort of brands like Visa, MasterCard, American Express and Discover. PCI-DSS requirements help ensure the secure handling of credit card information by our store and its service providers. If you don’t want us to process your data anymore, please contact us at adam.goldfarb@raymondjames.com or send us mail to: 295 Main St Ste 914 Buffalo, NY 14203. We reserve the right to modify this privacy policy at any time, so please review it frequently. Changes and clarifications will take effect immediately upon their posting on the website. If we make material changes to this policy, we will notify you here that it has been updated, so that you are aware of what information we collect, how we use it, and under what circumstances, if any, we use and/or disclose it. If you would like to: access, correct, amend or delete any personal information we have about you, you are invited to contact us at adam.goldfarb@raymondjames.com or send us mail to: 295 Main St Ste 914 Buffalo, NY 14203.

<script type="text/javascript">
_linkedin_partner_id = "2160274";
window._linkedin_data_partner_ids = window._linkedin_data_partner_ids || [];
window._linkedin_data_partner_ids.push(_linkedin_partner_id);
</script><script type="text/javascript">
(function(){var s = document.getElementsByTagName("script")[0];
var b = document.createElement("script");
b.type = "text/javascript";b.async = true;
b.src = "https://snap.licdn.com/li.lms-analytics/insight.min.js";
s.parentNode.insertBefore(b, s);})();
</script>
<noscript>
<img height="1" width="1" style="display:none;" alt="" src="https://px.ads.linkedin.com/collect/?pid=2160274&fmt=gif" />
</noscript>