Page 18 - Book4E

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To overcome this situation, Congress passed the National Act of Currency in 1863, which was revised in 1864 by President Abraham Lincoln. National banknotes were created and gradually put into circulation. These notes existed until the Federal Reserve banknotes that we use today were created in 1914.
It is well known that the Depression of 1929 was a disaster for the nation’s banks. Every morning, bank managers faced long lines of panicked depositors wanting to withdraw their funds. In the last three months of 1931 alone, more than 1,000 banks failed.
On March 5, 1933, the day after he took office, President Franklin Roosevelt called for a bank holiday. All the banks across the country were closed until it could be assessed whether or not they had enough funds to stay open or whether they would be liquidated. Three months later, federal deposit insurance came into being, which meant each depositor’s accounts were covered up to a certain amount. The insur- ance limited banks’ risks, and customers could be assured that their funds would be safe. This insurance remains in effect today.
World banking
Great Britain has been at the forefront of the banking industry since those goldsmiths started things off in the 1600s. London is a major financial center with nearly all of the world’s leading commercial banks represented there.
In developing countries, the banking system is similar to that in developed countries. Commercial banks are still mostly interested in short-term loans while other financial go-betweens, especially government-owned banks, handle the long-term loans.
In poorer countries of the world, the bartering system and in-kind trading are still important aspects of the economy. The micro credit movement, a revolutionary concept in which very small amounts of money are loaned to the extremely poor to enable them to develop as entrepreneurs, is making a significant impact on many lives.
History of Banking