Events

The Making of a Continental Financial System: Lessons for Europe from Early American History With Vítor GasparSpecial Adviser at Banco de Portugal Minister of Finance, Portugal (2011-2013) 

Discussant: Richard E. Sylla, Henry Kaufman Professor of the History of Financial Institutions and Markets, NYU Stern School of Business

Jan Svejnar, Director of CGEG moderated.

Vítor Gaspar revisited the experience of Alexander Hamilton as the first Secretary of the Treasury. Hamilton started from a situation where the Federal government was accumulating interest arrears on domestic and international debt. In 1789 the US did not have a modern financial system. When Hamilton left the Treasury in 1795, US Treasuries were regarded as the ultimate safe asset and the US financial system included a central bank, a commercial banking system and securities markets. Federal tax revenue was sufficient to ensure debt service and gradual debt redemption. Hamilton articulated answers to fundamental questions: why pay the public debt? How can public credit be sustained? How to stop financial panic?

Co-sponsored by the Program for Economic Research at the Columbia University Department of Economics.