VI. Panic of 1907 (Did the legislative response address the issues raised by the crisis?) 1. No lender of last resort. No federal discount window, no access to federal warehouse lines. 2. Largely...

Regarding the Panic of 1907 and great depression what were the major banking statutory responses and explain whether they were appropriate

Please refer to the attached document and expound upon and explain these answers

VI. Panic of 1907 (Did the legislative response address the issues raised by the crisis?) 1. No lender of last resort. No federal discount window, no access to federal warehouse lines. 2. Largely unregulated Trust companies in NY provided financing on speculative stock transactions. Further plagued by unscrupulous dealings with related parties and affiliates. 3. No federal deposit insurance. 4. Lack of nationwide reserve requirements. Pyramiding of reserves by country and reserve city banks. 5. Abusive/corrupt director interlocks. 6. No impartial federal regulator to assess which troubled depository institutions should survive crisis. 7. Panic of 1907 led to the enactment of the Aldrich Vreeland Act of 1908. This law authorized the creation of the National Monetary Commission to study the feasibility and terms of a US Central Bank. Political balancing took place between less populated agrarian states and those with large urban areas. 8. 1912 Pujo Money Trust hearings led to public perception that control of the banking system fell into the hands of a few wealthy financiers in NY. 9. Public outrage, as well as economic need for a central bank, led to the passage of the 1913 Federal Reserve Act. 10. Federal Reserve Act created the Federal Reserve System, including Board of Governors and 12 Federal Reserve Banks. c. Regulation Q-- prohibited banks from paying interest on demand deposits and authorized the FRB to regulate interest rates on savings accounts. d. McFadden Act-provided and limited national banks to the same branching rights within their home states as state banks. e. Holding Company regulation-1933 Act subjected bank holding companies and their banks to examination and regulation by the FRB. limited the holding company and bank's transactions with affiliated firms. f. Housing Legislation- i. Federal Home Loan Bank Act of 1932 (counterpart to FRBanks, created system of FHLBanks. ii. Home Owners Loan Act of 1933-authorized chartering of federal savings institutions to accept deposits and make residential mortgage loans. iii. National Housing Act of 1934-created the FSLIC to insure deposits of savings institutions. g. Calomiris thesis-The Banking Act of 1933 went too far and did not address the root cause of the Great Depression which he described as Unit Banking (perpetuated by laws that prohibited branch banking) and the Real Bills doctrine. ("Unit banking made banks less diversified and thus exposed to location specific shocks.") His view was unit banks were less competitive, less cost efficient, less profitable and thus had less capital. Barriers to entry prevented productive competition. Support for unit banking was popular in rural areas because the banks there had no choice but to lend to the local farmers. h. Gold Reserve Act of 1934-outlawed the private possession of gold, forcing individuals to sell to the US Treasury. Executive Order made it a criminal offense for US citizens to own or trade gold with exceptions for jewelry or collecting.