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The Federal Reserve System - History and Structure

            
             - A central bank is an institution that oversees and regulates the banking system and controls the monetary base.
             An Overview of the Twenty-First Century American Banking System .
             Crisis in American Banking at the Turn of the Twentieth Century.
             In the early 20th century there were national banks, and trusts, that were bank like institutions that accepted deposits, but were originally intended to manage only inheritances and estates for wealthy clients. They were supposed to engage in low risk activity so they were less regulated and monitored.
             - They had a good reputation and because they were less regulated they were able to give higher returns, so soon people started putting a lot of money into trusts.
             - The Knickerbocker trust failed in 1907 when it suffered losses from bad speculation in the stock market. People began pulling all of their money out and soon a dozen major trusts in NYC had failed.
             - JP Morgan and John D Rockefeller stepped in along with the US Secretary of the Treasury to shore up the reserves of banks so they could withstand the withdrawals.
             - The whole process took a little more than a week, but lead to a four year recession.
             - Production fell 11% and unemployment rose from 3% to 8%.
             Responding to Banking Crises: The Creation of the Federal Reserve.
             - In 1913 the national banking system was created as a way to compel all deposit taking institutions to hold adequate reserves and to open their accounts to inspection by regulators.
             - The Fed was given the sole right to issue currency in order to make the money supply sufficiently responsive to satisfy economic conditions around the country.
             The Structure of the Fed.
             - Two parts: the board of Governors and the 12 regional federal reserve banks.
             - One of the jobs of the federal reserve banks is to audit the books of private sectors to ensure good standing and a healthy bank.
             Decisions about monetary policy are made by the Federal Open Market Committee.


Essays Related to The Federal Reserve System - History and Structure

1. Federal Reserve System

The Federal Reserve System was chartered in 1913 to provide the US with a safer, and more stable monetary and financial system. ... The Federal Reserve System can be broken down into five sections to better understand it: the history and origin, structure, its use monetary policy, its job as a bank supervisor, and the financial services it provides. ... To better understand the Federal Reserve System it is important know the structure of it. ... There are five main financial services that the Federal Reserve System performs. ... The Federal Reserve System is what makes the United States...

  • Word Count: 1504
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  • Grade Level: Undergraduate

2. THe Federal Reserve

History of the Federal Reserve Act and Amendments to 8 IV. Structure of the System 9 V. ... Since the Federal Government has such a control over our Economy, I decided to tackle the subject of the Federal Reserve System and try to get a better understanding of the history, the structure, and the monetary policy of the power that it holds. ... HISTORY OF THE FEDERAL RESERVE Before Congress created the Federal Reserve System, periodic financial panics had plagued the nation. ... STRUCTURE OF THE SYSTEM The Federal Reserve System has a structure designed by Congress to give it a broad perspective...

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3. The Federal Reserve System

The Federal Reserve System, What is it? ... I will explore the structure of the Federal Reserve System and describe their responsibilities in the system. I want to explore the history of the Federal Reserve System and did not know of any better way to do it then listing the crucial points of the system below. The Federal Reserve System is the central bank of the United States. ... Now that we have looked at the structure of the Federal Reserve System, let's talk about the man who is in charge. ...

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4. History of the Federal Reserve

The Federal Reserve System is the central bank of the United States. ... To understand the history, first, one must understand the issues that led to the Federal Reserve act of 1913. ... Overall, Carter Glass had the largest role in the creation and shaping of the Federal Reserve System. ... Also, another difference in the Federal Reserve Act was the provision that all nationally chartered banks must be members of the Federal Reserve System. ... The current structure of the Federal Reserve System, then, includes members of the Board of Governors who are selected by the president and confi...

  • Word Count: 1859
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5. The Causes of The Great Depression

The Great Depression was a turning point in U.S history. ... These potential causes include the maldistribution of purchasing power, the lack of diversification in the American economy, the credit structure of the economy, bank failures, the action of the Federal Reserve, America's position in international trade, and the international debt structure. ... John Maynard Keynes, in the early 1930s, attributed the crisis to the impact of changes in Federal Reserve monetary policy. ... Nobel Laureat and University of Chicago emeritus economist Milton Friedman and his collaborator, Anna Schw...

  • Word Count: 1109
  • Approx Pages: 4
  • Grade Level: Undergraduate

6. The Great Crash

The leading causes of the stock market crash were margin buying, speculation, investment trusts, a bad banking system and the Federal Reserve Policy. ... However, there are three things that the Founding Fathers identified as enemies to any money system, and the Federal Reserve contains all three of them (Chan). ... In the whole Federal Reserve System is the fact that the private banks which own the stock in the Federal Reserve System charge the United States interest for borrowing the country's own currency (Chan). ... The Federal Reserve Bulletin of February 1929 stated that the Fed...

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7. Avoiding Another Financial Crisis

From 1928 - 1929, the Federal Reserve had raised interest rates in hopes of slowing the rapid rise in stock prices. ... The Federal Reserve did little to try to stop the banking panics. ... In addition to allowing the panics to reduce the U.S. money supply, the Federal Reserve also deliberately contracted the money supply and raised interest rates in September 1931. According to the monetarists Milton Friedman, Anna Schwartz and current chairman of Federal Reserve System Ben Bernanke at the time of Great Depression American central bank's policy making was really poor and it unwind loop o...

  • Word Count: 1664
  • Approx Pages: 7
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9. Baseball Antitrust Exemption

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