The Federal Reserve Act Law

The Federal Reserve has kept the United States from going under and having bank runs like the ones in 1930 during the great depression. During the 1930 over 9,000 banks failed causing great damage to the United States economy. The 1930 we hard times that the U.S never want to experience again. President Woodrow Wilson signed the act of the Federal Reserve 1913 which helped during the great depression but not a much as it could. The Federal Reserve has changed since then and does far more than before. The Federal Reserve issues currency, sets reserve requirements, lends money to banks, collect checks, acts as a fiscal agent for the U.S, supervise banks and controls money supply.

The Federal Reserve act law was signed by President Woodrow Wilson on December 23, 1913. Though the idea of a central bank was mentioned by Alexander Hamilton in 1789 during the ratification of the U.S constitution; but was denied because the constitution did not give that power to the government. Before the Federal Reserve Bank was created there was two banks before it that were the central bank for the United States. The first bank was opened in 1791 and failed in 1811 because congress did not want to renew the contract. The second bank of the United States was establish in 1816 under the presidency of Jackson but fail in 1836. The Federal Reserve was established in the United States in the time the nation was in a deep financial crises. During these finical crises the American people would race to their banks and withdraw their deposit causing bank failures; this was called a panic. This would cause an affect called the domino effect in which costumers would run to banks withdrawing their money causing banks to fail because banks did not have suffici...

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...were failing causing lots of bankrupts affecting the economy in a bad way. The fed had to intervene to stop the rise of bankruptcy and the recession the fed then stated to lower the discount rate to help banks and the American people and making the government to spend money and selling securities. The fed has lowered unemployment has helped the economy grow pulling the U.S out of the recession and is still happening today.

The Federal Reserve System has helped the United States in so many ways but the main one is keeping the United States economically sound. The Federal Reserve does so much like oversee the banks and make money and control it. Change the monetary policies and try to keep the U.S in good shape with economic growth and low unemployment. Without the Fed. The U.S would have not been the great country today with a great economy not perfect but stable.