Clearinghouses and the Origin of Central Banking in the United States

1985 ◽  
Vol 45 (2) ◽  
pp. 277-283 ◽  
Author(s):  
Gary Gorton
Keyword(s):  
United States ◽  
Deposit Insurance ◽  
Banking Industry ◽  
The United States ◽  
Central Banking ◽  
Price System ◽  
Endogenous Development ◽  
Banking Panics ◽  
Demand Deposits

The pre-1914 U.S. banking industry is not easily characterized as a market operating through a price system. The endogenous development of the clearinghouse as the industry's organizing institution can be explained by inherent characteristics of demand deposits. During banking panics the clearinghouse united banks into an organization resembling a single firm which produced deposit insurance.

State-Sponsored Insurance of Bank Deposits in the United States, 1907–1929

1981 ◽  
Vol 41 (3) ◽  
pp. 537-557 ◽  
Author(s):  
Eugene Nelson White
Keyword(s):  
United States ◽  
Deposit Insurance ◽  
Banking Industry ◽  
Strong Support ◽  
The United States ◽  
Small Unit ◽  
Bank Deposits ◽  
Key Factor ◽  
Branch Banking ◽  
Federal Deposit Insurance

Before the creation of the Federal Deposit Insurance Corporation in 1933, several states established deposit guarantee funds. The key factor influencing the adoption of deposit insurance by a state was the structure of its banking industry. In states where small unit banks were dominant, there was strong support for guarantee funds to protect deposits; in other states there was more interest in branch banking. The failure to design the guarantee funds in accordance with sound principles of insurance brought about their demise and led to increased branch banking.

The Origins of Central Banking in the United States

1979 ◽  
Vol 66 (2) ◽  
pp. 391
Author(s):  
Peter Temin ◽  
Richard H. Timberlake
Keyword(s):  
United States ◽  
The United States ◽  
Central Banking

Origins of too-big-to-fail policy in the United States

2020 ◽  
Vol 27 (1) ◽  
pp. 1-15
Author(s):  
George C. Nurisso ◽  
Edward Simpson Prescott
Keyword(s):  
United States ◽  
Federal Reserve ◽  
Systemic Risk ◽  
Deposit Insurance ◽  
The United States ◽  
Too Big To Fail ◽  
Interstate Banking ◽  
Legal Constraints ◽  
Federal Deposit Insurance ◽  
Over Time

This article traces the origin of too-big-to-fail policy in modern US banking to the bailout of the $1.2b Bank of the Commonwealth in 1972. It describes this bailout and those of subsequent banks through that of Continental Illinois in 1984. During this period, market concentration due to interstate banking restrictions is a factor in most of the bailouts and systemic risk concerns were raised to justify the bailouts of surprisingly small banks. Finally, most of the bailouts in this period relied on the Federal Deposit Insurance Corporation's use of the Essentiality Doctrine and Federal Reserve lending. A discussion of this doctrine is used to illustrate how legal constraints on regulators may become less constraining over time.

Systemic Risk in the United States banking industry

2014 ◽  
Author(s):  
Johnathon Peruski ◽  
Caroline Lacy ◽  
Walter Goethel ◽  
Matthew Boegner ◽  
Jack Byers ◽  
...  
Keyword(s):  
United States ◽  
Systemic Risk ◽  
Banking Industry ◽  
The United States
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