The Federal Reserve Bank Essay example
High school
Essay
Finance & Accounting
Pages 5 (1255 words)
Download 0
The Federal Reserve Bank History of the Federal Reserve Bank Federal Reserve Bank is the central banking system of USA. There are 12 parts of Federal Reserve Bank which together form an important part of the system of Federal Reserve in USA. Those 12 banks divide the nation into 12 districts of Federal Reserve according to the Federal Reserve act (1913)…

Introduction

It was established in the year 1791 with its charter signed by George Washington. The bank used to perform all the major banking functions. After the expiry of the charter 20 years hence, country was without a central bank for few years resulting into inflation. Again a second bank came into existence in 1816 with a charter signed by James Madison. In 1833 again the charter expired and United States went without a central bank for 40 years. In 1873, gold was standardized into bimetallic standard. Then a private set up by the name of JPMorgan came into existence who was the lender of the last resort for the banks who are facing crisis. Federal Reserve Act of December 23, 1913 created the Federal Reserve System. A new central bank was established which would act as the lender of the last resort to banks facing crisis, assured the investors not to disinvest their money. Federal Reserve Bank was opened in 1914. Federal Reserve notes were provided by the Congress so that the currency supply in the economy remains flexible. The Federal Reserve System is the independent agency, that exists outside the Cabinet of the executive and its powers are derived from congress. ...
Download paper
Not exactly what you need?

Related papers

Central Bank and Monetary Policy
This paper deals with central bank objectives, instruments and theory behind them. Five objectives of central banks will be described and discussed. Central banks’ objectives are price stability, stable real growth, financial stability, and interest rate and exchange stability. Then, direct and indirect tools of monetary policy will be described and discussed. Direct tools affect directly the…
The Monetary Behavior as Created by the Federal Reserve
The Federal Reserve has the power, and has always had the power since its creation, to control the amount of funds in its regional banks throughout the United States. By the Federal Reserve requiring any Federal Reserve banks to keep reserves on hand to handle unexpected outflows as well as meet the demands for the daily operations, it was believed that stability in the behavior and value of a…
the federal reserve
Close co-ordination between the Federal Reserve and the Government of the USA is essential, because monetary policies should be in sync with fiscal policies for an effective and sustainable economic growth in the long run. Role of Federal Reserve in stabilizing economy The steps taken by the Federal Reserve, for example by increasing the interest rates to reduce inflation will have an impact on…
(Optional)
Despite the billions of dollars infused in federal stimulus bills such as the JOBS (Jumpstart our Business Startups) Act, the economy is still in fragile health; even the Federal Reserve Bank has employed all the monetary tools at its disposal to revive the economy, such as a continuing a low-interest rate regime and the use of quantitative easing programs to pump more money into the economic…
Federal Reserve
The Board of Governors is appointed by the President who controls the functions of the Federal Reserve System. There are Federal Reserve Banks which operates in major cities of US. The major objectives of the Federal Reserve System are aimed at the welfare of the US economy. The Federal Reserve System in US is responsible for maximizing the employment opportunities in US, stabilizing the prices in…
Comparison Between European Central Bank and Federal Reserve Bank
Ideally, they enjoy the monopoly of controlling money supply and can use the money printing policy to manage the financial situation in their currency zones. Monetary Policy Objectives Comparing the two, FED can be described as having multiple objectives, while the ECB has a single mandate. By the Federal Reserve Act, FED is set to handle several compatible goals; price stability is given more…
Bank Reserves and its Role on Money Supply
Ignoring this function is like assigning financial intermediaries merely a passive role in the financial system (FRBSF, 2001). In recent days, in the midst of the economical crisis, it has become more and more apparent that such a passive perception of banks is unwarranted. Also, the volume of broad funds in the financial system is due to the interaction of the banking system (counting the central…