A Brief Note On The Federal Reserve System Essay

A Brief Note On The Federal Reserve System Essay

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Taxation and finance are two complicated aspects of the US Economy. To ensure that the financial sector is doing well the US government created the Federal Reserve System. The Federal Reserve System is the country’s central bank and it was established on December 23, 1913 (“FRB: What Is the Purpose of the Federal Reserve System?”). The members of the congress of that time established it so that there will be an institution that can help the country handle its financial concerns. Thus, its main task is to “provide the country with a stable and flexible financial system” (“FRB: What Is the Purpose of the Federal Reserve System”). It is also meant to help the government manage the banks and other financial institutions in the country as well as ensure the financial stability of the country (“FRB: What Is the Purpose of the Federal Reserve System”).
Another important concept in the Finance and Economy of the country is the Free Market. The Free market refers to the deliberate give and take situations that occur in the country (Rothbard). It is born out of the mutual agreement between two parties where in the first party gives the second party something that it wants in exchange for something that the first part wanted (Rothbard). It can be money in exchange for a service or a service in exchange for an item. This occurs for as long as both parties are able to provide the desires of the other. However, it is important to take note that exchange of goods, money and services may still occur even if a party does not have the sufficient and the right items to pay the other. In such situation, a debt occurs. In here, the services, money or goods are given to Party A by Party B while Party B awaits for the time when Party A is now able t...


... middle of paper ...


... pay it.

REFERENCES
• “FRB: What Is the Purpose of the Federal Reserve System?”. Board of Governors of the Federal Reserve System. 4 Feb. 2014. Web. 30 Nov. 2014. .
• Rothbard, Murray. "Free Market." The Concise Encyclopedia of Economics. Web. 30 Nov. 2014. .
• Amadeo, Kimberly. "3 Reasons Why America Is in Debt." About. About,com, 23 Sept. 2014. Web. 30 Nov. 2014. .
• Slemrod, Joel. "Progressive Taxes." The Concise Encyclopedia of Economics. Library of Economics and Liberty. Web. 30 Nov. 2014. .
• Chantril, Christopher. "Government Spending Details." : Federal State Local for 2014. Web. 30 Nov. 2014. .

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