New York City, New York, the United States of America
May 19th, 1835
Rowland G. Hazard walked down the street and into the Federal Bank of the United States on Wall Street, a large rectangular building made out of white marble. It was early in the morning, with a few clouds floating in the sky and a chill breeze drifting through the air. Wall Street was already busy with dozens of workers making the final repairs to the damage that the street had suffered during the 'Anglo-American War' (as some were calling it already, while others called it 'the Second American Revolution'). Additionally, numerous businessmen and bankers were carrying out their business in the financial sector of New York City, as Wall Street was home to over a dozen large businesses and several banks. The thirty-three-year-old man was on his way to Federal Bank to secure another loan for his company, as he was planning on expanding his textile and farming tool factories down in Rhode Island. Usually, he utilized the bank in Providence for his business. However, he had a meeting with a representative from American Enterprises later that evening, so he decided to make do with the giant Federal Bank building in New York City (one of many attractions to America's biggest city). Since the war was over, thousands of young men were returning to continue their lives as civilians, and Hazard's factories were now filled to maximum capacity. With trade resuming somewhat with France and other European powers (though, Hazard had heard that France was fighting Austria and Prussia once again, while it was busy trying to tie down 'the Confederation of Aragon' to itself), business was slowly picking up again, and the American economy was showing signs of life.
As he strolled into the bank's large lobby, he was met face to face with a statue of a bald eagle standing on a pillar with its wings outstretched. A plaque below the eagle stated, "Federal Bank of the United States: For the People, By the People." The lobby itself consisted of several booths (with only a few of them filled with bank tellers, as it was early morning), a seating area with a dozen benches, a newspaper rack, and a ticketing machine. He pulled out a ticket from the machine next to the bald eagle statue and looked at the number inked onto the paper, '19.' Nearby, a bank 'messenger' (who relayed the ticket numbers to the tellers and kept the flow of the guests controlled) tipped his cap and Rowland returned the gesture.
He sat down quietly with his briefcase and quietly read through a newspaper. The New York Times, one of New York's and America's finest newspapers, had a large and bolded headline at the front page that announced First President Samuel Kim's funeral march. The funeral was set to start today and travel from New York City to Boston, Quebec City, and then down to Florida after it finished its journey through the northern states. Rowland frowned as he looked at the deceased president's picture, who wore his military uniform from the days of the American Revolution even though the picture was taken just months before his death. His grandfather had fought in the Revolutionary War alongside the man, and it seemed as though the entire nation was now in mourning as the shock of the war wore off. While the government was fine and the nation was still (relatively) intact, it felt as though America had lost her captain.
Before he could finish a sports article describing why the New York Yankees were favorites to win their twenty-fifth American Series championship in October, his number was called by one of the tellers.
"Number 19, please report to Booth Number 5."
Adjusting his suit jacket's collar, he walked up to Booth 5 and opened up his briefcase with a confident smile. He handed his bank card and pulled out a few documents he had prepared in the last week or so, "If it's possible, I would like to speak with the manager and acquire a business loan."
"How much money do you plan to borrow?" The teller, a stocky and tanned Native American man, asked.
"Ten thousand, in Bucks or coins. Either one works for me."
'Bucks' were green paper money that the United States government had printed throughout the Anglo-American War. They were not backed by gold or silver and were purely on 'faith and credit.' Like Rowland himself, many citizens were rightly worried about this monetary change, but the Bucks were absolutely critical to the war effort. With trade with Europe lost and the federal government's budget running on fumes (not to mention the difficulty in transporting gold from the West to the East), the Bucks provided a way for the government to finance the war and keep the economy from completely collapsing on itself. It was also a way to scale back the production of coins (except coins worth less than a dime, as they were not 'valuable' in terms of metal worth) and hold precious metals in reserve when trade was re-established with the rest of the world. The Buck and Banking Act of 1833, the brainchild of Secretary of the Treasury Nicholas Biddle, created nearly $400 million worth of Bucks (money printed on green, cotton paper that was difficult to forge due to various engravings and fail-proofs). The denominations were $1, $2, $5, $10, $20, $50, $100, and $1000. While one Buck was not as valuable as one Gold Eagle, the United States' dollar coin (the usual exchange rate was a dollar and fifty cents of Bucks for a dollar of an Eagle), it was stable enough to be widely accepted as a form of payment. Though, the sentence 'This note is a legal tender for all debts, public and private, except duties on imports and interest on the public debt, and is receivable in payment of all loans made to the United States' was clearly branded to the back of every Buck.
"I'm sorry, sir. We received a telegram last night that we are to suspend all loans above one thousand dollars."
"Only one thousand? Why?" Rowland asked, bewildered by the sudden change. There were only two things that could've suddenly shifted the Federal Bank's policies: the Federal Reserve (which oversaw the Federal Bank and was tasked with keeping an eye on inflation caused by the Bucks) and Congress itself.
"The Federal Reserve Director in Columbia announced that a bill to print more Bucks is about to fail in Congress. The Federal Bank's reserves are low, and to counteract any future issues involving bank runs, we are capping loans at one thousand dollars."
By no means was Rowland a mathematician or a businessman that knew every aspect of the economy. However, he learned a few things from his father about the finer points of asking around to determine the current economic situation, "What about the bank rates?"
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The Federal Bank of the United States was not the only bank in the nation. There were hundreds of state and private banks across America, with very different monetary policies than the standardized and carefully controlled Federal Bank. However, the Federal Bank provided an enormous amount of funding to state and private banks and kept them somewhat organized and monitored to prevent fraud and bank runs. If the Federal Bank was suddenly pushing unfavorable policies due to a monetary reserve issue, it was possible that the bank rates were being raised.
"It was raised to ten percent just last night."
"Ten percent!?" Rowland nearly yelled, "It was one percent just a week ago!"
A sudden rise in the bank rates would mean that other banks would have less money to lend out, which meant that he wouldn't be able to borrow large sums of money from private or state banks due to the sudden bank rate hike. Or even if he could, the interest rates for such a loan would be insanely high.
"I'm sorry, sir. However, we are in a precarious position, and we are doing our absolute best to accommodate our partners..."
The Rhode Islander sighed and shook his head, "Forget it. I'm assuming the loan interest rates have risen as well?"
"Only slightly. It is currently at 5%. We are also only lending out Bucks instead of coins for the foreseeable future."
"I'll have to make do with what I can get. One thousand it is."
An hour later, Rowland left the bank with a contract for a thousand dollar loan with a 5% interest in hand. He opted to withdraw the thousand dollars from the Federal Bank in Providence, though he withdrew some money from his personal account to spend during his stay in New York. As he walked off Wall Street and towards the train station, he witnessed a crowd of tens of thousands of people that seemingly appeared out of nowhere. Men, women, and children of all races, colors, and creed watched silently as a locomotive with a single passenger car passed through the Manhattan Central Station. Realizing that it was Samuel Kim's funeral processions, Rowland took off his hat, held it close to his heart, and waited in silence as an aged man (who he presumed was the deceased president's eldest son) read Samuel's final words to the United States.
Suddenly, the skies darkened and droplets of rain began to fall upon New York City, as if nature itself was crying from the man's death. Rowland looked up and covered his head with his left hand. The rain felt ominous as if it was a warning to the United States for what was about to come.
Just three days later, with Congress failing the second Buck and Banking Act, the United States would enter the period known as the 'Great Recession.' The day would officially be known as Black Friday (as in the following month, numerous banks across the nation would close, and the American government would be unable to provide sufficient funding for Reconstruction programs) and begin an era of economic and political uncertainty that would last for nearly six years (that would only end in future president Nathaniel Bonapart's fourth year in office)...
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AN: For reference, here are the current coin denominations in the United States. Anything under a Dime is usually made with cheaper metals like copper or iron, while Quarters and above are made with either Silver or Gold.
Half Cent ($0.005)
Cent ($0.01)
Half Dime ($0.05)
Dime ($0.10)
Quarter ($0.25)
Half Eagle ($0.50)
Eagle ($1.00)
Quarter Union ($2.50)
Half Union ($5.00)
Union ($10.00)
Double Union ($20.00)
Columbian ($50.00)
Double Columbian ($100.00)