Bank Regulators Correspond

Bank regulators correspond to waiters, managing two frangible supper plates. On one hand, they must balance out the budgetary framework to deflect future emergencies. On the other hand, they must approve bank developments to encourage future monetary development and success. Various faultfinders have criticized that the National Banking Acts of 1863 and 1864, two United States federal banking acts that established a system of national banks and created the National Banking System have neglected to accomplish both of these objectives trying to change the free banking system. In any case, separated from all these viewpoints, the act, by several, have been found favorable. The endowment of the National Banking System radically represented a paramount milestone in the development of the financial infrastructure of the United States economy. It not only encouraged the development of a national currency, but served to create the dual structure that is now a defining characteristic of the U.S. banking system and the economy as well. Moreover, these acts attempted to assert some degree of federal control over the banking system past the formation of another central bank. Without doubt, this act was ultimately successful providing the creation of a uniform currency and the need for an effective means of financing the aftermath of the Civil War, which helped shape the Federal Government throughout the history of America.

The need for a uniform currency, one that would have an identical nominal value regardless of the geographic location in which it was used in the United States was well perceived essentially from America's commencement. Its accomplishment had been a tricky one up to the Civil War years. As opposed to having a few hundred, or a few thousand, forms of currency circulating in the states, directing transactions could be extraordinarily simplified if there were a uniform currency. Before the development of the National Banking System, the different coinage issued by state and private banks ordinarily did not circle at standard with each other. Because of the difficulties this imposed on interregional exchange, early pioneers of the nation underlined the requirement for a uniform currency. For instance, James Madison alluded to the absence of a uniform currency in the period between the First Bank of the United States and the Second Bank of the United States by saying, "It is, however, essential to every modification of the finances that the benefits of a uniform national currency should be restored to the community."

Furthermore, Secretary of the Treasury William Crawford accentuated the negative outcome a non uniform money had on interregional exchange by saying, "In referring to the causes which had the most decided influence in calling the United States Bank into existence, the inconveniences resulting to the community from the inequality in the rate of exchange between the different sections of the Union stand eminently prominent." The National Banking System most certainly accommodated a uniform currency. National banks were entitled by law to acknowledge the notes of other national banks at standard. Likewise, this was encouraged by an across the nation arrangement of recovery focuses starting in 1874. These all guaranteed that national banks would not experience the ill effects of the same issue with which state banks were beset.

With the eruption of the Civil War in 1861, the recurrent conviction was that the Civil War would be transient. The volume of notes which a national bank issued was focused around the business sector estimation of the United States Treasury securities the bank held. A national bank was required to keep on deposit with the Comptroller of the Currency a sizeable volume of Treasury securities. In the North, it was felt that the superior industrial strength of the North would lead to a quick victory over the predominantly agricultural South. The South accepted that northerners would not have the resilience to battle a war. However, these