The nation and the states
The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.--Tenth Amendment to the Constitution of the United States.
When the Constitution put the states out of the money business, it gave commercial banking a tremendous lift. The three state-chartered banks of 1784 grew to eighty-eight by 1800. We have seen that these institutions, by issuing bank notes, were creators of money, and that this power was limited only by the necessity of keeping enough coin in their tills to cover the notes presented for redemption. However, the banking policy of the time was generally conservative, and the issue of notes was not pressed to anything near the limit.
This salutary convention was also observed by the new federal bank.1 The Bank of the United States was a "quasi-____________________
Since these early institutions were central banks (i.e., organizations whose operations have a purpose transcending private profit and which deal de jure or de facto with "retail" banks as the monetary arm of government), Bray Hammond has used "federal bank" to describe them in his Bank and Politics or America ( Princeton: Princeton University Press, 1957). His convention is followed here.