Federal Reserve: Development In 1913 During The Great Depression

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Federal Reserve In the following paper, I will summarize an article about the Federal Reserve (The Fed). The article goes into some of the details as to why the Federal Reserve was develop in 1913 during the Depression, how it helps banks that are in trouble, and how important it is to keep the country’s economy running (Marotta, 2014). History With the United States was in the middle of the Great Depression, and after withstanding many financial situations and the bank runs in 1907. The treasury was forced to give up control of the country’s money when Congress established the Federal Reserve (The Fed) in order to give the citizens some sort of security when saving their money in banks. Also to prevent the runs on the banks which caused quite a few banks to close and a lot of people to lose their money. What is the Federal Reserve’s purpose …show more content…

They were in charge of giving loans to banks which were having issues with money due to the failing economy. Then in 1933 with the Federal Deposit Insurance Corporation (FIDC) was created to insure banks up to a certain limit it took over a lot of the fed’s main purpose. After that the Fed just help with the bank issues the FDIC missed, until in 1977 when the Fed’s purpose was changed again to keeping the American people employed, and being in charge of keeping inflation low, that also includes the raising or lowering of interest rates and also the release or the holding of the country’s currency

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