Wilson made increasingly caustic comments about bankers. In June 1911, in Harrisburg, Pennsylvania, he told a cheering throng that “the greatest monopoly in this country is the money monopoly,” adding that “all of our [financial] activities are in the hands of a few men.”

The task of reconciling banking reform with the party’s states’-rights traditions fell, improbably, to a southern congressman—the Virginian Carter Glass.

A century later, Ben Bernanke reignited this debate with his frantic acquisitions of mortgage securities, Treasury bonds, and also the very commercial paper of which Paul Warburg was so enamored.

“probably the most farreaching [sic] and most scientifically prepared legislative proposal upon any subject in the country’s history, at least since the early days.”

If Jackson had stood against the supposed evils of centralization, Warburg, more than anyone else, had recognized the weakness in stand-alone banking and crusaded to overcome the Jacksonian view.

Nonetheless, the Reserve Banks were permitted to conduct open market operations such as buying bonds, later to become a favorite tool of Ben Bernanke.

The key problem that Warburg outlined was the lack of a central reserve. In effect, each of the country’s approximately fifteen thousand banks stood watch over its own cache of gold, which neutralized what could have been a potent collective reserve. Another problem was the lack of a liquid market in so-called bills of trade—pieces of paper represe

Aldrich, who had been so wedded to the old currency based on government bonds, showed courage in supporting a new currency based on private loans.

avoid the possibility of political influence, which, as he saw it, was the critical weakness of the Second Bank in the time of Jackson.