How was the creation of money handled under the arrival of confederation

Under the arrival of the confederation, each state and the national government created money.

Since the authority of the Congress is limited, it was able to only ask the states for the tax, it couldn't collect directly.  There existed two ways to collect money either borrow money from other governments or sell the western lands. due to lack of funds, Congress was not able to build an efficient army and failed in regulating trade.

The Confederation relying on the willing struggles of the states to give tax funds to the federal administration. Supremacy of courts did not exist. And later on, the constitution gives authority to federal government and authorized courts to work.

both are true, the congress does have the power to create banks, even if this power is not specifically described in the constitution, since there is nothing restricting it and there is power given to the congress to make "all laws which shall be necessary and proper". maryland was not allowed to tax a branch of the national bank operating there, and the supreme court decided that no state could. both of these topics were discussed in a decision of the mcculloch v. maryland case in 1819.

necessary and proper clause. the congress shall have power to all laws which shall be necessary and proper for carrying into execution the foregoing powers, and all other powers vested by this constitution in the government of the united states, or in any department or officer thereof.