The Federal Reserve What is the Federal Reserve System? It is the central bank of the United States When was the Federal Reserve Created? It was created on December 23, 1913 with the signing of the Federal Reserve Act by Wilson

The Federal Reserve What are the Federal Reserve’s Responsibilities? Conducting the nations monetary policy by influencing money and credit conditions in the economy in pursuit of full employment and stable prices Supervising and regulating banking institutions to ensure the safety and soundness of the nation’s banking and financial system

The Federal Reserve What are the Federal Reserve’s Responsibilities? Maintaining the stability of the financial system and containing systematic risk that may arise in financial markets Providing certain financial services to the U.S. government, to the public, to financial institutions, and to foreign official institutions

The Federal Reserve How is the Federal Reserve System structured? Board of Governors Operate out of Washington DC consists of seven members who are appointed by the president and confirmed by the senate Typically economists or business/banking leaders with extensive understanding of the national economic and financial system Charged with overseeing the 12 District Reserve Banks and helping implement national monetary policy

The Federal Reserve How is the Federal Reserve System structured? Twelve regional Federal Reserve Banks located in major cities throughout the nation. Each Federal Reserve branch office has its own board of directors, composed of three to seven members. Provide vital information concerning the regional economy

The Federal Reserve Who owns the Federal Reserve? It isn’t “owned” by anyone It is an independent entity within the government, having both public and private purposes Derives its authority from Congress All nationally charted banks and some state chartered banks hold stock in the Federal Reserve (Fed Stock). These banks are called Member banks Fed Stocks can’t be sold or traded but Member banks receive a fixed 6 percent dividend annually on their stock

The Fed as Inflation Fighter The Feds most important job is making sure there is enough money and credit to allow the economy to grow, but not so much money that the currency loses its value. INFLATION a general rise in prices of goods and services, which reduces the purchasing power of money. Monetary policy is to fight inflation so that the economy can grow.