The postCivil War period saw significant changes in the US. monetary system from "summary" of A Monetary History of the United States, 1867-1960 by Milton Friedman,Anna Jacobson Schwartz
Following the Civil War, the United States experienced notable transformations in its monetary system. The war had left the country burdened with a large amount of debt, prompting the government to reevaluate its financial policies. One key development was the establishment of the National Banking System in 1863, which aimed to create a more uniform and stable currency. Under this system, national banks were required to hold government securities in order to issue banknotes. This helped to standardize the currency and reduce the risk of bank failures. In addition, the government also began to issue greenbacks – paper money not backed by gold – to help finance the war effort. This marked a departure from the gold standard that had previously been in place. The post-war period also saw the rise of the gold standard as the predominant monetary system in the United States. The Resumption Act of 1875 paved the way for the country to return to the gold standard, setting a date for the redemption of greenbacks in gold. This move was aimed at stabilizing the currency and restoring confidence in the financial system. Furthermore, the establishment of the Federal Reserve System in 1913 marked a significant shift in the country's monetary policy. The Federal Reserve was created to serve as the central bank of the United States, with the authority to regulate the money supply and interest rates. This was a major step towards centralizing control over the country's monetary system.- The post-Civil War period brought about substantial changes in the US monetary system. From the adoption of the National Banking System to the return to the gold standard and the creation of the Federal Reserve, these developments shaped the country's financial landscape for years to come. Through these changes, the US aimed to create a more stable and efficient monetary system to support its growing economy and ensure financial stability.
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