In August 1763, northern Europe experienced a financial crisis with numerous parallels to the 2008 Lehman Brothers episode. The 1763 crisis was sparked by the failure of a major provider of acceptance loans, a form of securitized credit resembling modern asset-backed commercial paper. The...

We examine the link between scheduled FOMC meetings and the VIX uncertainty measure. Our results indicate that regardless of the pre-scheduled status of such meetings, the VIX significantly declines on meeting dates, which we attribute to the resolution of uncertainty regarding future interest...

Can tight and centralized financial regulations prevent financial crises? Governments usually respond to financial crises with tightening and centralizing financial regulations. In this paper, we explore the historical parallels between the governmental responses to the financial crises at the...

Recent American and European financial crises prompt the questions: under what conditions do crises end, when does a rescue plan crystallize, and how does a rescue happen? I examine a successful rescue operation in the worst pre-Federal Reserve financial crisis, the Panic of 1907, with these...

Legal restrictions theory suggests that interest-bearing money would dominate if there were no legal impediments precluding competition with non-interest-bearing currency. There are very few historical examples with meaningful issues of interest-bearing currency, however, and these tend to occur...

There is not an overwhelming case to be made that the Federal Reserve System (FRS) should be analyzed as a bureau instead of as a firm or set of firms. Accordingly, I discuss the formation of the FRS in relation to the framework developed by William Gartner for describing the phenomenon of new...

This article examines how the U.S. banking system responded to the founding of the Federal Reserve System (Fed) in 1914. The Fed was established to bring an end to the frequent crises that plagued the U.S. banking system, which reform proponents attributed to the nation’s...

Established by a three person committee in 1914, the structure of the Federal Reserve System has remained essentially unchanged ever since, despite criticism at the time and over ensuing decades. This paper examines the original selection of cities for Reserve Banks and branches, and placement...

Virtual currencies are a contemporary form of private money. Thanks to their technological properties, their global transaction networks are relatively safe, transparent, and fast. This gives them good prospects for further development. However, they remain unlikely to challenge the dominant...

We find evidence that the runs on banks and trust companies in the Panic of 1907 were linked to the Bank of England's contractionary monetary policy actions taken in 1906 and 1907 through the medium of copper prices. Results from our VAR models and copper stockpile data support our argument that...