These were Paul Warburg, a refined, German-born financier, recently relocated to New York, who was horrified by the primitive condition of America’s finances Rhode Island’s Nelson W. Lowenstein focuses on the four men at the heart of the struggle to create the Federal Reserve.

America’s Bank showcases Lowenstein at his very finest: Illuminating complex financial and political issues with striking clarity, infusing the debates of our past with all the gripping immediacy of today, and painting unforgettable portraits of Gilded Age bankers, presidents, and politicians. Roger Lowenstein - acclaimed financial journalist and best-selling author of When Genius Failed and The End of Wall Street - tells the drama-laden story of how America created the Federal Reserve, thereby taking its first steps onto the world stage as a global financial power. Finally, in 1913, Congress conceived a federalist and quintessentially American solution to the conflict that had divided bankers, farmers, populists, and ordinary Americans, and enacted the landmark Federal Reserve Act. It took an economic meltdown, a high-level tour of Europe, and - improbably - a conspiratorial effort by vilified captains of Wall Street to overcome popular resistance. But political will for reform was lacking. The real-world consequences of this chaotic and provincial system were frequent financial panics, bank runs, money shortages, and depressions.īy the first decade of the 20th century, it had become plain that the outmoded banking system was ill equipped to finance America’s burgeoning industry. Each bank was left to stand on its own, with no central reserve or lender of last resort. Americans’ mistrust of big government and of big banks - a legacy of the country’s Jeffersonian, small-government traditions - was so widespread that modernizing reform was deemed impossible. Today, the Fed is the bedrock of the financial landscape, yet the fight to create it was so protracted and divisive that it seems a small miracle that it was ever established.įor nearly a century, America, alone among developed nations, refused to consider any central or organizing agency in its financial system.

A tour de force of historical reportage, America’s Bank illuminates the tumultuous era and remarkable personalities that spurred the unlikely birth of America’s modern central bank, the Federal Reserve.

Ways and Means by Roger Lowenstein