[AdamSelene235]

Yeah, just ask those who lost everything in the 1820s due to wild cat banking about "moral hazard."

Oh please. Is that the best boogey man you can conjure up?

The Government encouraged the wildcatters to purchase war-debt bonds and convert them into bank notes to help fund the War of 1812. Within 2 years this tripled the nation's currency supply.

Hardly an example of "free banking" or a GS.

[justshutupandtakeit]

Wildcat banking came into play a decade or so after the War of 1812. The term came from Michigan in the 1830s. Government needs occasioned by the War of 1812 had nothing to do with Wildcat banking.

Republican fanaticism had allowed the charter of the the National bank to expire (despite Madison's effort to recharter) and there was then no way to finance the War. Interest bearing Bank notes were then issued to cover the cost of the War. These were used in some cases to form reserves for state chartered banks but the "government" did not "encourage the wildcatters" since this was about 2 decades before the Wildcatters.

Any discussion of "free banking" general starts with the Wildcats. You can argue about the appropriateness of the association if you like it isn't mine.

But it is entirely correct that the moral hazard of the Wildcats was far greater than any federally chartered bank which is the point.