FEDERAL RESERVE
The United States took over a hundred and twenty years to prefect a working banking system that could adequately adjusts to the constantly changing economy. The Federal Reserve System most important purpose is to preserve a stable economy in the US. The focus on monetary policy is to protect the purchasing power of the dollar and to encourage conditions that promote sustainable economic growth and high employment. The Federal Reserve System is a network of committees working together to ensure a productive unified monetary policy for the United States that is flexible with the ups and downs of in the business. This network oversees the banking industry to protect the security of the monetary policy. At the birth of the Nation there was a need for one central bank to oversee and control all the banks in the United States. The Bank of the United States was given a charter to be the first central bank by Alexander Hamilton in 1791. Due to the longstanding mistrust farmers held for the banking industry, the idea of one bank holding such immense power was not well received and when the twenty-year charter was due for renewal in 1811, the Uni
Management Review, (1997) July-August, v86 n7. Andelman, David A. "Central banker to the world. (US Federal Reserve System). War I to the New Deal." Federal Reserve Bulletin, (1989): June, v75 n6. Open market operations is the buying and selling of United States Government securities on the open market for the purpose of influencing short term interest rates and the growth of money and credit. If there is a need for an increase in the growth rate of the money supply, credit is needed, or a downward pressure on short-term interest rates, the Fed buys securities from brokers or dealers, which adds money to the reserve accounts of the banks of brokers or dealers. Then the banks credit the accounts of the brokers and dealers, which increases the amount of money and credit available in the market. Whenever the growth of money and credit needs to be slowed down, the Fed sends securities to brokers and dealers, taking payment by debiting the accounts of banks of the brokers and dealers. Reserves leave the banking system, which reduces the money supply and cuts back the expansion of credit.
Some common words found in the essay are:
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Approximate Word count = 4099
Approximate Pages = 16 (250 words per page double spaced)
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