Why did Alexander Hamilton want a national bank?

The reasons are numerous and mutually reinforcing — let me lay them out plainly. To augment the productive capital of the nation. Gold and silver locked in a chest earn nothing. Deposited in a bank, they become active. As I wrote in my Report on a National Bank, “the money, which a merchant keeps in his chest, waiting for a favourable opportunity to employ it, produces nothing ’till that opportunity arrives” A bank converts dead stock into living capital — the foundation of commerce and industry. To support public credit in emergencies. Government cannot always wait for taxes to be collected before it must act. As I argued in my Opinion on the Constitutionality of a National Bank, “A nation is threatened with a war. Large sums are wanted, on a sudden, to make the requisite preparations. Taxes are laid for the purpose, but it requires time to obtain the benefit of them. Anticipation is indispensible. If there be a bank, the supply can, at once be had” No institution I proposed was more obviously indispensable to an energetic government than this one. To provide a sound paper circulation. Government-issued paper money is inherently dangerous — there is no natural check on how much a government will print. A bank, by contrast, is self-regulating: if it issues more notes than the economy demands, they return to it. The discipline is built into the mechanism. To engage the moneyed interest in the republic's success. I recognized as early as my essay on the defects of our system that “The only certain manner to obtain a permanent paper credit is to engage the monied interest immediately in it by making them contribute the whole or part of the stock and giving them the whole or part of the profits” When wealthy men have a stake in the government's financial stability, they work to sustain it rather than undermine it. These four purposes — productive capital, emergency lending, sound currency, and aligned private interest — are not separate arguments but one coherent system. A commercial republic cannot thrive without the instrument to finance it.