National Bank
Definition
A national bank is a financial institution chartered and regulated by the federal government. In the context of US history, it refers to two banks established in the early 19th century, which were instrumental in managing the country's finances.
Analogy
Think of a national bank as your school's treasurer. Just like how the treasurer manages funds for various school activities, collects dues, and pays bills, a national bank handles money for an entire nation - issuing currency, controlling credit flow, and handling government funds.
Related terms
Federal Reserve System: This is the central banking system of the United States today. It was created to provide a safer and more flexible monetary system.
Alexander Hamilton: He was one of America's founding fathers who proposed the idea of a national bank to handle debts from Revolutionary War and stabilize American economy.
Bank War: This refers to Andrew Jackson’s campaign against the Second Bank of United States due to his belief that it held too much power and could abuse its privileges.
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Practice Questions (5)
Which leader advocated for the establishment of a national bank to establish a firm economic standing in the world?
This plan involved creating a national bank, provided for economic growth, raised tariffs, and created infrastructure like canals and roads
Which historical figure is most closely associated with establishing a national bank during the early American republic?
Which American statesman is known for creating a financial plan that included paying off war debts, creating a national bank, and putting taxes on goods to protect industries?
Which Secretary of Treasury is associated with the establishment of a national bank during George Washington's presidency?
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