Federal Reserve Act Of 1913 Essay

The Federal Reserve Act of 1913 was an attempt to stabilize the to the fiscal markets, after the Panic of 1907 demonstrated the issues inherent with a system without control. This established twelve regional Federal Reserve Banks with a lot of autonomy and gave them the authority to discount eligible securities from member banks to provide some elasticity to the financial system. During the early years, the Federal Reserve System (FRS) had a limited part in the United States’ economic life. It was not till the Great Depression that things changed for the FRS. The 1935 Banking Act created in Washington D.C., a Board of Governors with more authority over the operations of open market and the discounting of rates for Federal Reserve Banks. The improvements to the FRS were attempts to prevent causing price inflation while stimulating the economy. Lastly, with the 1946 Employment Act giving explicit responsibility to the federal government to maintain full employment and stable values. To which fact, the FRS continues to have a vital part in that

Natural resources, innovation, specialization, and many other factors, following the events of the American Civil War, the economy was still need of rebuilding and the corruption that arose during this time created some of the major economic issues, we saw leading to the implantation of the Federal Reserve Act and the 16th Amendment concerning Federal Income Tax. These contributed to the stability and growth up until the Great Depression. Afterwards the Banking Act of 1935, gave the Federal government even more power and control over U.S. markets. This monetary control, allows for the preservation of the markets and attempts to control inflation and depreciation and as can be viewed through studies conducted by the Federal Reserve bank of St. Louis, it has been successful (Martin,