Economic Terms/Notes
I. National Bank
A. Hamilton’s arguments for . . .
B. Anti-federalist opposition
C. 1st Bank of US 1791-1811
D. 2nd B.U.S. 1816-1836
II. Independent Treasury (1837)
A. Response to Depression of 1837
B. Divorce Bill – divorce government from banking
C. Subtreasury System 1846 (Polk)
III. National Banking Act (1836)
A. Republican measure to tax state banks out of existence
B. More involvement
IV. Federal Reserve Act (1913)
A. response to the perception of a money “trust” Pujo Commission
B. more elastic money supply, government can respond to the monetary needs of the
economy (monetary policy)
C. criticized for not using its powers during Great Depression of 1929
V. New Deal Economic Notes
A. Keynesianism: fiscal policy-government’s use of taxing and spending power to
adjust the economy, leads to . . .
B. Deficit financing: go into debt on purpose of stimulating spending. This is why FDR
enacted public works and it is also why World War II gets us out of the Depression
C. FDR was not an ideological Keynesian, but was a pragmatist
VI. Economic Boom 1948-1973
A. Why?
VII. Economic Stagnation Late 1960’s and early 1970’s
A. Why?
Vietnam and Social Spending (Guns and Butter)
B. Inflation and effects
C. Paul Volcker and Federal Reserve squeeze credit, through high interest rates
VIII. Reaganomics
A. Supply Side Economics
B. Unleash free market forces
C. High deficits
D. Some argue gap between rich and poor grows