When Washington Shut Down Wall Street: The Great Financial Crisis of 1914 and the Origins of America’s Monetary Supremacy

Len's Summary: Traces Treasury Secretary William McAdoo’s triumph over the monetary crisis sparked by the start of WWI. With the central bank (the Federal Reserve System) authorized by the Owen-Glass Act of December 1913 not yet in place, he closed the American Stock Exchange for four months to prevent foreigners from selling their holding and demanding gold in return. McAdoo both honored America’s commitment to the gold standard and sustained public confidence in the banking system, preventing a repeat of the disastrous 1907 run on American banks. The author is a professor at the Stern School of Business, NYU.