The Federal Reserve - 975 Words

U. S. MONETARY POLICY Life: Where do we come from? How did we get here? These are questions each one of us eventually asks ourselves and, in so doing, searches for the answers. It is intrinsically woven into us to know the basis of what sustains us. Why is it then, that the general public is satisfied in knowing only about current celebrity gossip and is content to remain ignorant when it comes to where our currency originates and how it is produced? Some may find it too confusing and overwhelming a subject about which to think. Is it possible that its perplexity is not by mistake? James Corbett mentions in his documentary, Century of Enslavement: The History of The Federal Reserve, â€Å"Our monetary ignorance is artificial, a smokescreen that has been erected on purpose and perpetuated with the help of complicated systems and insufferable economic jargon.† (Corbett, J., 2014, July 6.https://www.youtube.com/watch?v=5IJeemTQ7Vk) Federal Reserve For centuries, banks have relied on fractional reserve banking. This is the method in which only a fraction of a bank’s deposits are actually backed by a reserve of cash-on-hand, available for immediate withdrawal. This procedure allows the bank more capital to lend and at the same time, grows the economy. The reserve amounts are determined by a ratio stipulated by the Federal Reserve. In theory, fractional reserve banking works most of the time. However, in difficult economic times, people have demanded to withdrawShow MoreRelatedThe Federal Reserve1337 Words   |  6 PagesThe Federal Reserve has been around America for more than a century. It has helped America keep a stable central bank, have maximum employment, and many more great advantages. The Fed isn’t just a tiny piece of the puzzle; it has a great deal of importance with the roles it plays in everyday life that not a lot of people know of. With the Fed basically being the bank of every bank in America, it has a lot of responsibility. Over the past one hundred years the Federal Reserve has proven to benefitRead MoreThe Federal Reserve ( Investopedia ) Essay1574 Words   |  7 Pagespowerful monetary system, called the Federal Reserve (Investopedia). It involves one central agency and twelve regional Federal Reserve Banks that are accountable for their designated areas in the United States (Investopedia). Its primary purpose was to establish a secure, malleable, and a solid financial system which was to prevent financial devastation during times of crisis (Investopedia). More specifically, prior to the creation of the Federal Reserve Bank, the United States had bouts of crisisRead MoreThe Federal Reserve1187 Words   |  5 PagesJannet Yellen is Chairwoman of the Federal Reserve, and arguably the most influential person in the world. The Federal Reserve is the bank of the United States. The Federal Reserve’s decisions, approved by Jannet Yellen, impact the entire US Eco nomy, the largest and most important economy in the world, almost instantly. The Federal Reserve is quasi-private. It is not apart of the U.S. Government, however, it is not an entirely separate entity. The Federal Reserve was founded in 1913 as a means toRead MoreThe Federal Reserve1484 Words   |  6 PagesThere are many thoughts about the Federal Reserve, some people think it is the biggest thief ever and some other people think that the Illuminati is running the show. Also some people know that the Federal Reserve has saved the economy of the United States a couple of times from depressions. Moreover, economists think that the Federal Reserve saved the U.S. from the most recent depression in 2008. Many people in the U.S. may not know who Alexander Hamilton is; however, any economist or anybody whoRead MoreThe Federal Reserve1450 Words   |  6 PagesCentral Bank known as the Federal Reserve. Not only does the Federal Reserve have control over the average American citizen but also over; America s upper management reigning from The house of Representative s, The Senate, all the way up to the President of The United States. That being said, the Federal Reserve is an overall negative economic influence and the veil they have been working behind for decades must be brought down. The history of The Federal Reserve goes as far back as theRead MoreRole Of The Federal Reserve1210 Words   |  5 PagesRole of Federal Reserve We will begin with real GDP. Real GDP, an acronym for Gross Domestic Product, is the total value of final goods and services during a particular period or year adjusted for price changes. The GDP is an indicator of a country’s economic health. Final goods and services definition is a goods consumed rather than used for further processing. The Real GDP is increased or decreased based Inflation or deflation. Inflation is an increase in the average overall price for goodsRead MoreThe Responsibilities of the Federal Reserve1591 Words   |  6 PagesCongress has handed over the responsibility for monetary to the Federal Reserve, also known as the Fed, but retains oversight responsibilities in order to ensure that the Federal Reserve adheres to the statutory mandate of stable prices, moderate long-term rates of interest, as well as, maximum employment (Labonte, 2014). The responsibilities of the Fed as the country’s central bank are classified into four: monetary policy, supervision of particular types of banks and financial institutions forRead MoreFederal Reserve Essay824 Words   |  4 PagesFederal Reserve The Gross Domestic Product (GDP) is a calculation that provides insight into the current economy of our nation to allow individuals to understand the current and past year’s standings in the economy. The calculation of the GDP allows for the government to determine what adjustments are necessary to manage an effective status for the economy. Based upon the GDP the government can forecast any necessary changes that must be made to either the monetary policy or the fiscal policy.Read MoreThe Federal Reserve Essay695 Words   |  3 Pagesmain goals of Progressivism: protecting social welfare, promoting moral improvement, fostering efficiency, and creating economic reform. President Woodrow Wilson, elected in 1912, made the most important change of the early 1900s; he passed the Federal Reserve Act. American citizens have been wary of a government-controlled banking system since the formation of the country. The people did not trust centralized government action, and they were largely agrarian people, knowing little about the bankingRead MoreThe Duty of the Federal Reserve561 Words   |  2 PagesThe Federal Reserve Act was signed into law on December 23, 1913. Due to a series of financial panics around 1907, the Federal Reserve (also referred to as the â€Å"Fed†) was created by Congress to promote a stable banking system and an active economy. The Federal Reserves’ greatest client and biggest spender is the government of the United States. All proceeds from taxes generated and disbursements are managed through the account that the United States government has set up with the Federal Reserve