Bell Work  Do you have a bank account? Is it a saving or a checking account?  Do your bell work on your packet. There is room on the last page.

NCSS and MDE NCSS Standards: 1 Culture 6 Power, Authority, and Governance 7 Production, Distribution, and Consumption MDE Competencies:

Chapter 5 Banking and Money Oak Grove Economics

History Of The Banking System

During the American Revolution Continental Bills Not This One

Constitution Levy Taxes Coin Money

Federalist VS. Anti- Federalist Federalist favored centralized banks Anit-Federalist favored state chartered banks

Bank of the United States

4 Functions  1. To hold tax funds collected by the federal government.  2.To assist the federal government in tax collection, borrowing, and interstate trade regulation  3.To issue representative money in the form of bank notes.  4.To ensure that state-chartered banks held sufficient gold resources to cover bank notes that they issued.

Say No To National Banks What National Bank? Mr. President we need you to renew the bank charter National Bank?

United States Note Representative money during the Civil War.

Coinage Act 1873 The government no longer purchased silver and moved to the gold standard. The Government Silver

Gold Standard I pity the fool who wants silver.

Federal Reserve Act

Federal Reserve Note

Stock Market Boom Stock prices were inflated and did not represent the worth of the company.

Stock Market Crash October 29, 1929

Bank Holiday All banks were closed.

Federal Deposit Insurance Coporation Created to provide insurance for customer deposits.

Lifted Bank Regulations

Bank Bailout

Real Estate Bubble

Bartering In a series of trades, Kyle MacDonald traded this red paper clip for other items until he ended up owning a house.

Functions of Money  A medium of exchange.  A unit of account.  A store of value. The functions of money is to not make it rain but is:

A Medium of Exchange  As a medium of exchange, money acts as an intermediary or link Not this kind of medium but:

Unit of Account The unit of the weights are measured in pounds or grams. ___ The unit of height are measured in feet or meters. The unit of value is measured in money.

A Store of Value

Characteristics of Money  Durability  Portability  Divisibility  Uniformity  Limited Supply  Acceptability

Durability

Portability

Divisibility

Uniformity

Limited Supply

Acceptability

Types of Money  Commodity  Representative  Fiat  Electronic

Conclusion  The National Bank in 1791 had 4 functions.  The First National Bank and Second National Bank were vetoed.  The Coinage Act of 1873 put the U.S. on the gold standard.  The Federal Reserve Act centralized banking but into districts.  A “run” on the bank happens when large number of people withdraw money from the bank.  The “Bank Holiday” closed all banks during the Great Depression to allow the federal government to strengthen, reorganize, and reopen banks.  Questionable and illegal mortgage practice involved issuing mortgages to people who normally do not qualify for them.  This caused many foreclosures on homes.

Bibliography For pictures of old money and federal reserve notes refer too: fun-currency-auction/ For the pictures of the cows refer to: For pictures of the stock market crash and New Deal related photos refer to: For real estate bubble cartoon refer to: For maps refer too: labor-is-in-short-supply/ For Revolutionary, Federalist and Anti-Federalist refer to: