Federal Reserve

First let me talk about the federal replacement System (federal official Reserve, Fed) and explain why it was created and its responsibilities. The national Reserve is the united States central bank and was created by Congress to provide a much flexible, stable, monetary and pecuniary system. The Fed banks clear and dish out one third of all checks in the country that totals some 20 billion checks per year. The national Reserve law was created on December 23rd 1913 when President Woodrow Wilson signed it into law. Today the Federal Reserves responsibilities fall into four general areas.
(1) It conducts the res publicas monetary policy, influencing money and credit conditions in the rescue trying for full employment and stable prices.
(2) It supervises and regulates banks and other financial institutes to ensure safety and soundness of the banking and financial systems and to protect the credit rights of consumers.
(3) It maintains the stability of the financial system and contains systematic risk that may arise in the financial market.
(4) It provides certain services to the unify States government and financial institutions, and foreign official institutions and plays a study role in operating and overseeing the nations salary systems.




There are factors that would influence the Federal Reserve in adjusting the discount rate (interest rate). If the money supple is low the Federal Reserve can lower the discount rate or interest rate and this volition increase the money supply. This ordain allow the banks to lower the interest magnitude also allowing more consumers and businesses to borrow money. If the money supply is high then the Federal Reserve can raise the discount rates and this will lower the money supply. This will cause interest rates to go higher in banks causing fewer loans to be made to consumers and businesses. The Federal Reserve sets the discount rate with the acclamation of the Board of Governors. The discount rate change by the Federal Reserves is used...If you want to get a full essay, order it on our website: Ordercustompaper.com



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