Federal Reserve

Federal Reserve

by Talon Mayer -
Number of replies: 2

The FED was created to assist banks with their financial problems. If a bank were to run out of money, they can get some reserve money from the FED in order to stay in business. This process prevents more runs on the bank and depressions. When the FED was created, it was created in secrecy. This is because people don't like the government making new laws and rules and using our tax dollars to help banks stay in business. The 'higher-ups' knew that many wouldn't see the full picture of the FED until it was already in action, so they used a lots of secrecy.

In reply to Talon Mayer

Re: Federal Reserve

by Josiah Smith -
As you correctly pointed out the Fed was created in secrecy. However, it was more because the us citizens have bad reactions to a central bank. The idea would not have been allowed to be pursued.
In reply to Talon Mayer

Re: Federal Reserve

by Brady Ellington -
The Fed was created so that banks don't have bank runs. It was created so that the Fed can loan money to the banks if they don't have the money to give back to citizens. It was created in secrecy because in the early 1900s people hated the idea of anything close to a "central" bank and they hated basically anything that was central. It was in secrecy so that people would not have fought back against it if it was revealed to the public.
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