Chapter 6 - Chapter 6 Before 1863 States chartered banks...

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Before 1863: States chartered banks Issued their own currency National Banking Act of 1863 10% tax on banknotes from state-chartered banks Created national banks, issue banknotes tax free Today we have a dual banking system Glass-Steagall Act of 1933 Following bank failures during Great Depression Restricted banks so that they could not offer other financial services. 13-1 Chapter 6
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Banking Industry Structure: Branching McFadden Act of 1927: National banks had to Meet branching restrictions of state banks Could not branch across state lines Do branching restrictions enhance competition? Bank Holding Companies: Way to evade branching restrictions Became way to offer nonbank financial services 13-2
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Pawnshops provide loans to people without access to the traditional financial system. Because the loans are collateralized, the terms are often reasonable – better than payday loans, for
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Chapter 6 - Chapter 6 Before 1863 States chartered banks...

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