Federal Reserve System (Fed)


By The Anand Market  

What is Federal Reserve ? 

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The Federal Reserve System (also known as Fed) is the central bank of the United States. It was founded to provide the country with a safe, flexible, and stable monetary and financial system. 

How the Federal Reserve Works ? 

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Federal Reserve is governed by the presidentially-appointed board of governors or FRB. It is usually responsible for the formulation of monetary policy and the regulation of member banks 

Structure of Federal Reserve System 

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Fed is composed of 12 regional Federal Reserve Banks that are each responsible for a specific geographic area of the US. Fed has a board that is comprised of 7 members. 

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The 12 Federal Reserve regional banks are located in Boston, Atlanta, Chicago, Philadelphia, Cleveland, Dallas, Minneapolis, Kansas City, New York, Richmond, San Francisco and St. Louis. 

Who Owns the Federal Reserve ? 

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The Federal Reserve is an independent entity established by the Federal Reserve Act of 1913. The board and FOMC make the Fed's decisions independently based on research. 

What Does the Federal Reserve Do ? 

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The Fed's main duties include conducting national monetary policy, supervising and regulating banks, maintaining financial stability, and providing banking services. 

Funding of Federal Reserve System 

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Fed's main income source is interest charges on a range of US government securities it has acquired through its open market operations (OMO). 

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