2. NATIONAL BANKING ACT
• Created dual banking which allowed banks to
have state or national charters
• National banks issue banknotes which are backed
by U.S. government bonds
3. FEDERAL RESERVE ACT
• Serves as nation’s central bank with power to
regulate reserves in national banks, make loans to
member banks, and control the money supply
• Prints Federal Reserve notes as the major form of
currency
4. GREAT DEPRESSION
• Stock market hit bottom in 1929-stocks and other
investments lost value
• Businesses and individuals were unable to repay
loans from banks
• Thousands of banks collapsed
• Franklin Roosevelt (president) closed all banks for
100 days
• Only banks that could prove they were financially
stable could reopen
5. FDIC
• Congress passed the Glass-Steagall Banking Act
which established the FDIC
• Allows the FDIC to regulate the S&L industry
6. GRAMM-LEACH BLILEY ACT
• Allows bank holding companies freedom to have
full range of banking services
• Advantage-creation of universal banks
• Disadvantage-weaken competition among banks
for services
7. GRAMM-LEACH BLILEY ACT
• Allows bank holding companies freedom to have
full range of banking services
• Advantage-creation of universal banks
• Disadvantage-weaken competition among banks
for services
