When the United States won it's independence and became a country, there was very little structure in it's monetary system. Each state basically had it's own way of doing business that included using the currencies of other countries, most notably Spain.
The founding fathers saw a real need to create a sound, uniform system that was dependable and fair. They gave Congress the power to develop and enact a uniform system of monetary affairs and what it is still being used today in one form or another.
There has been many changes over the years that has strengthened the country and the monetary system is still being updated on a regular basis.
Important events in U.S. monetary history:
1791 - First Bank of the United States chartered by Congress.
1792 - Congress passed the first Coinage Act making the dollar the national monetary unit.
1816 - Second Bank of the United States chartered by Congress.
1849 - Gold discovered in California bring large amounts into the national treasury.
1863 - The National Banking Act authorized the establishment of National Banks that could issue notes backed by government bonds.
1873 - Silver dollar omitted from list of coins to be minted and circulated.
1878 - Bland-Allison Act authorized the Treasury Department to purchase large amounts of silver for coinage.
1900 - The Gold Standard Act placed the gold dollar as the standard unit of value in the United States.
1913 - The Federal Reserve Act authorized the establishment of 12 regional Federal Reserve Banks.
1933 & 1934 - As one of the efforts to combat the Great Depression of the 1930's, The Monetary Banking Acts of 1933 and 1934 were passed prohibiting gold from being exported to other countries and granting the restoration of unlimited silver coinage that returned the U.S. to a bi-metallic monetary system.
1971 - President Nixon ended ties between the dollar and gold or silver and put the U.S. on a managed, none metallic, monetary system.
1980 - The Depository Institutions Deregulation and Monetary Control Act eliminated the ceiling on interest that banks and savings and loans pay to their depositors. It also required banks to follow the guidelines of the Federal Reserve System.
2001-2003 - During this period, the federal reserve lowered interest rates at least 13 times because the country was moving into a recession. Because of the inflated home market caused by the easiness of getting a loan, property values have tripled in many areas, thus causing many people to resort to sub prime lending.
2007 - Although interest rates are still relatively low, sub prime lending has had a negative effect on the home loan industry. Many banks, savings and loans, mortgage lenders, and mortgage brokers, as well as morgagees and potential homebuyers, are struggling with the effects. As with all periods of U.S. history, when the economy becomes stagnant, Congress and the Federal Reserve has to make adjustments and implement changes in monetary policies to nudge the economy in the right direction.