The Fed
Federal Reserve System
History of The Fed
- Established 1913 by Woodrow Wilson
- Created to Prevent Depression and Recession
- Congress 3rd Attempt at Creating a Central Bank
Fed's Goals & Responsibilities
- Goal is to Stabilize Economy
- Make Important Decisions that Affect Economy
- Clear Checks
- Supervise Banks
- Supply Money
FOMC
- Members Include 7 Board of Governors, New York District Bank President, 4 Rotating Reserve Bank Presidents
- 12 Voting Members
- Meet 6-8 Times Per Year
Monetary Policy Tools
- Open Market Operations
- Discount Rates
- Reserve Requirements
Board of Governors
- 7 Members
- Handpicked by President
- Approved By Congress
- 14 Year Terms
Reserve Bank
- 12 Different Reserve Banks Across U.S.
- Located in San Francisco, Dallas, Kansas City, Minneapolis, Chicago, St. Louis, Atlanta, Cleveland, Boston, New York, Philadelphia, Richmond
- Hold Money, Clear Money, Supervise other Member Banks
BEP
- U.S. Bureau of Engraving and Printing
- Creates Paper Money
U.S. Mint
- Create all of U.S. Coins
- Create Commemorative Coins
- Holds All Of U.S. Gold
Money/ Currency
- From 1800's to 1913 Over 30,000 Currency Used Across U.S.
- Current Common Currency Created after 1913
- Current Currency Made Up Of 6 Bills and 6 Coins
Inflation
- Prices Rise Quickly
- People Spend Too Much Money
Recession
- Sluggish Economy
- High Unemployment
Depression
- Severe Recession
- Long Term