America's Bank

Starred review from August 17, 2015
This superb chronicle by Lowenstein (Buffet), a former Wall Street Journal reporter, traces the formation of America’s Federal Reserve. Lowenstein helpfully reminds readers that at the start of the 20th century, the U.S. was the world’s sole industrialized nation to lack a central banking system, following two failed attempts, in 1791 and 1816, respectively, and a charter vetoed by President John Tyler in 1841. With many Americans, especially those in rural areas, suspicious of both banks and the federal government, the idea of a government-run banking system was widely unpopular. Lowenstein identifies four figures as integral in turning the tide, starting with Paul Warburg, a German immigrant who believed the American system should mimic the European model, and Sen. Nelson Aldrich, an ambitious, successful Republican from Rhode Island who was the subject of intense criticism by muckraking journalists. Centralization was also championed by President Wilson and Rep. Carter Glass, a Virginia Democrat, who was charged with creating a plan that would balance reform with states’ rights. Lowenstein vividly recounts the key moments in this hard-fought battle, from the Panic of 1907 to the 1912 presidential campaign to Wilson’s impassioned declaration to a joint session of Congress. Captivating and enlightening, this book brings a pivotal time in American history to life. Agent: Melanie Jackson, Melanie Jackson Agency.

August 1, 2015
The story of the creation of the Federal Reserve. In the mid-19th century, American banking was antiquated and chaotic. In other industrialized nations, centralized banking systems ensured monetary stability. By contrast, the banks in the United States were "disconnected and isolated, left to prosper or flounder (or fail) according to the reserves of each individual institution." Most were small, rural institutions chartered by state governments and issuing thousands of currencies. As a result, there were frequent "financial panics, bank runs, money shortages, and indeed, full-blown depressions," bank failures, and note forgeries were commonplace. But as veteran financial journalist Lowenstein (The End of Wall Street, 2010, etc.) makes clear in this dramatic creation story, Americans remained wary of the idea of a central bank. "When the subject was money, central authority had always been taboo; it was a demon that terrified the people," he writes. Mainly rural Americans favored "the comfortable Jeffersonian principle of small government." After the severe Panic of 1907 (when financier J.P. Morgan stepped in to shore up the banking system), Sen. Nelson W. Aldrich formed a commission whose investigation of the crisis paved the way for passage of the Federal Reserve Act of 1913. Lowenstein traces the heated congressional battles that led to establishment of the Federal Reserve System, consisting-then as now-of 12 banks with power shared between the federal government and private banks and with responsibility for supervising the banking system, setting short-term interest rates, and guiding national monetary policy. His well-researched account for general readers takes us from Aldrich's secret meeting with leading Wall Street figures on Jekyll Island, off the Georgia coast, to plot banking reforms, to Woodrow Wilson's Princeton bedchamber, where the ill president persuaded Virginia Congressman Carter Glass of a key compromise to ensure creation of a national bank. Lowenstein doubts the Federal Reserve Act could be passed in today's volatile political climate, but he provides an unusually lucid history of our nation's central bank.

COPYRIGHT(2015) Kirkus Reviews, ALL RIGHTS RESERVED.

May 1, 2015

A reporter for the Wall Street Journal for more than ten years and now a contributing writer for publications like the New York Times Magazine, Lowenstein has five substantial books behind him, including 2010's highly regarded The End of Wall Street. Here he chronicles the creation of the Federal Reserve, recalling a time when America alone among developed nations had no central bank. With a 100,000-copy first printing.

Copyright 2015 Library Journal, LLC Used with permission.

September 15, 2015

The Federal Reserve Act was signed into law in 1913 by President Woodrow Wilson. This important legislation launched the Federal Reserve System that created a centralized national bank and that continues to drive current U.S. monetary operations, banking credits, and economic policies with the goal of ensuring financial stability and resiliency in times of crises. Journalist Lowenstein (Buffett) tells the important and intriguing story of the act's passage and creation in an atmosphere of suspicion that is deeply rooted in America's history of distrust of centralized authority. Extensive details are provided about Federal Reserve predecessors, such as the First and Second Banks of the United States and relevant figures, such as Paul Warburg, Nelson W. Aldrich, and Carter Glass, who helped formulate how the Federal Reserve System would function. Lowenstein skillfully shows the connections between past and current events. VERDICT Readers seeking a comprehensive history of the Federal Reserve from its conception to modern times will find this work especially appealing. [See Prepub Alert, 4/13/15.]--Caroline Geck, Camden Street Sch. Lib., Newark, NJ

Copyright 2015 Library Journal, LLC Used with permission.