The New York Clearing House Association is the oldest and largest bank clearinghouse in the United States. Established in 1853, the Clearing House was created to provide “clearing” operations for the burgeoning network of New York banks. New York City has been the center of commerce in the United States since the American Revolution. Each day, porters from the banks would carry bags of gold and silver coins from bank to bank to settle accounts based on the checks drawn and deposited by the banks’ customers. With the gold rush in California and development of the railroad system, the number of banks in New York grew from 24 to 57 in the period from 1849 to 1853. This expanded the number of exchanges exponentially. Using the London Clearing House system as a model, a bank bookkeeper named George D. Lyman proposed the creation of a central office to clear accounts. Bankers quickly created the New York Clearing House, with 52 members participating in the exchange. The first day the Clearing House exchanged $22.6 million in checks. Clearing House members agreed to weekly audits, minimum reserve levels, and daily settlement of balances. For most of the 19th century, there was no central bank, and the United States experienced economic panics, frequently due to lack of liquidity in the financial system. During the panic of 1857, the Clearing House created loan certificates that could be used to settle accounts. In effect these certificates were currency, adding the needed liquidity. Certificates continued to be used into the early 1900s, until Congress passed legislation creating the FEDERAL RESERVE SYSTEM. The Fed replaced many of the Clearing House’s functions, including supervision of banks and providing liquidity to the financial system. Today the New York Clearing House processes an average of $20 billion worth of checks daily and is expanding with the growth of the U.S. economy. In 1970 the organization created the Clearing House Interbank Payments System (CHIPS), facilitating real-time FOREIGN EXCHANGE transactions. CHIPS transfers an average value of $1.2 trillion daily, handling 95 percent of all U.S. dollar payments among countries around the world. In addition, the Clearing House operates the Electronic Payments Network and Electronic Check Clearing System, which is a major wiretransfer and clearinghouse provider in the country, in addition to the Federal Reserve’s Fedwire.