Federal Reserve ONE Flashcards
(6 cards)
A Stronger Fed
1935, Congress adjusted the Federal Reserve so that it could respond more effectively to future crises
New Fed enjoyed a more centralized power so that the regional banks were able to act consistently with one another while still representing their own district’s banking concerns
Board Of Governors
The Federal Reserve System is overseen by the Board of Governors
Board of Governors: the seven member board that oversees the Federal Reserve System
Headquartered in Washington D.C
7 members staggered 14 year terms by the President with Senate consent
Stagger to prevent political pressures, can’t be reappointed, geographical restrictions to prevent over representation
12 District Reserve Banks
The Federal Reserve Act divided the United States into 12 Federal Districts. One Federal Reserve Banks is located in each district
Federal Reserve Districts: 12 banking districts created by the Federal Reserve Acts
Each district is made up of more than one state and Congress regulates the makeup of each Reserve Banks’ board of nine directors to make sure it represents many interests
Member Banks
All nationally chartered banks are required to join the Federal Reserve System
FAC
Federal Advisory Council (FAC): Research arm of the Federal Reserve that collects infomation about each district that reports to the Board of Governors about economic conditions within their districts
1 members from each Federal Reserve District, 12 members total
FAC meets with Board of Governors four times a year
FOMC
The Federal Open Market Committee (FOMC): makes key monetary policy decision about interest rates and the growth of the U.S money supply
FOMC’s decision can affect financial markets and rates for mortgages as well as many economic institutions around the world
FOMC members include:
All 7 members of the Board of Governors
5 of the 12 district bank presidents
President of the New York Federal Reserve Bank
The six other district bank president who serve one-year terms on a rotating basis
