Reserve system. Federal Reserve System (FRS). Money supply in circulation

It was created in December 1913 as a body to prevent systematic crises. Gradually, its functions and powers were significantly expanded. But what is the Fed? Is it a "secret society" or just another central bank, albeit the richest country in the world?

Main functions

The main purpose of the Fed is to conduct monetary policy. Thus, the following answer to the question of what is the Fed is absolutely correct: it is a body in the United States that regulates the amount of money in circulation by setting the required reserve ratio, the refinancing rate and open market operations. The Federal Reserve is in charge of controlling inflation and maintaining price stability. Also, the US Federal Reserve seeks to achieve a maximum level of employment. The main function of this body is the sustainable economic development of the country. What it is? The Fed provides for GDP growth of 2-3% per year. However, the appointment of the Federal Reserve System is not limited to this. The Fed meeting may touch on the topic of regulation of commercial banks to protect consumer rights. Also, the discussion may be related to maintaining the stability of financial markets and preventing potential crises. Moreover, the Fed provides services to the US government, federal and foreign banks.

Structure

Consideration of the question of what it is - the Fed, would not be complete without studying the components of this body. There are three in total. The Board of Governors is the main body. It manages monetary policy. The Fed's Board of Governors has seven members. They are responsible for setting the discount rate and reserve requirements for member banks. Any Fed decision is based on an analysis carried out by its staff. Every month, all conclusions are published in the so-called "Beige Book", every six months the Monetary Report of the Congress is published. Another component is the Federal Open Market Committee (FOMC). Its task is to set the target rate for funds. The Federal Committee includes members of the Board of Governors and 4 of the 12 presidents of member banks. This body meets eight times a year. Another component of the Fed is the member banks themselves. They supervise commercial financial institutions and monitor the implementation of the chosen monetary policy. Each of the 12 member banks is in its district.

History of origin

The first attempts to create a more flexible monetary system in the United States were made as early as the 18th century. The First and Second Banks were established in 1791 and 1816, respectively. Each of them lasted about 20 years. Both the First and Second Banks had branches throughout the country and served the government, monetary institutions, and private clientele. In general, their performance was satisfactory. However, a significant part of the population did not have any confidence in them. The decrease in their authority was due to the aggravation of political contradictions, so they closed. The Panic of 1907 prompted Congress to create the Federal Reserve System. The National Monetary Commission was established to evaluate methods to prevent constant financial panics and business failures. In 1913, Congress passed the Federal Reserve Act. It was originally planned that the Fed would have much less power than we see now. It was supposed to support the creation of member banks, increase the elasticity of the currency and the efficiency of the entire system as a whole. However, gradually the range of powers of the body in question has expanded significantly, which is associated with the periodic occurrence of crises requiring state intervention.

Who owns the Fed?

The Federal Reserve System is an independent bank. The decisions of the FOMC and the Board of Governors are based on the research of the Fed staff. They are not ratified by the president, the Treasury or Congress. That is, they are independent. However, the members of the Board of Governors are elected by the President and confirmed by Congress. Thus, the state controls the long-term policy of the Federal Reserve System. Some officials treat the latter with such suspicion that they see the need for a complete cessation of its activities. Senator Rand Paul believes the system needs to be audited more thoroughly.

The Role of the Chairman

The head of the Fed sets the direction of monetary policy. Janet Yellen is the chair from 2014 to 2018. She focused her attention on overcoming unemployment, which was her scientific specialty. So it lowers interest rates. Many experts believe that its actions only exacerbate the crisis, and the economy needs the opposite measures to stabilize. From 2006 to 2014, the chairman was He was an expert on the Fed's role during the Great Depression. It was thanks to Bernanke that the effects of the recent recession were mitigated.

Federal Reserve System(Fed) is an independent federal agency that functions as the Central Bank of the United States. The Fed has a very complex structure and is a joint stock company with a special status. The Fed is owned by private individuals, and the leadership is appointed by the President of the United States after the approval of the Senate.

History of creation

The Federal Reserve System was created on December 23, 1913. The Fed was created to control the country's banking system. Before the creation of the federal reserve, there was no single one in the United States; from 1863 to 1913, several banks performed its function, guided by the "National Banking Law".

The essence of this law was that only a few banks that received a charter from the US Congress to issue bank notes could issue money. The need for such a law was due to the fact that, under the current legislation, state banks had the right to issue banknotes. At the same time, banknotes were issued in any quantities, since it was not required to ensure their value from the bank.

After the adoption of the law on national banks, the US government from August 1, 1866 introduced 10% on the issue of banknotes by state banks and payments that were made with these banknotes. These measures led to the fact that banknotes issued by state banks gradually went out of circulation and were no longer issued.

But the lack of a centralized banking system nearly spelled disaster for the United States economy. In 1907 there was a financial crisis known as the "Banking Panic of 1907". This crisis began with an unsuccessful attempt by a group of banks to seize control of the shares of the United Copper Company. After that, capital outflows began from these banks, and soon depositors throughout the country began to withdraw their deposits.

The financier John Pierpant Morgan succeeded in preventing the panic, who pledged large sums of his own money to strengthen the banking system and convinced other major New York financiers to do so. We can say that Morgan acted as the Central Bank, increasing the assets of the country's financial market with the assets he attracted.

After preventing the financial crisis, the US government, led by Theodore Roosevelt, seriously thought about creating a centralized bank management. Senator Nelson Aldrich proposed a list of reforms aimed at reorganizing the banking sector, which were implemented by the next US President, Woodrow Wilson, and eventually led to the creation of the Federal Reserve System.

Fed structure

The Federal Reserve System is an amalgamation of 12 regional federal reserve banks. In addition, its structure includes more than 6,000 FRS member banks. The structure is managed by the FRS Board of Governors. In addition, the Federal Reserve System includes the Federal Open Market Committee and the Federal Advisory Council.

Federal Reserve Banks

The Federal Reserve Banks form the backbone of the Federal Reserve System. They were created by the Federal Reserve Act passed by Congress in late 1913. 12 Federal banks operate in the states assigned to each of the banks. The FRB has 25 offices in various US business centers.

The Federal Reserve Banks have the same powers, and since the activities of each bank are limited geographically, such a scheme contributes to some decentralization of the banking system. But at the same time, thanks to the presence of 12 similar banks, business financial centers are located in different parts of the country, and are not concentrated in one city. Banks have the name of the city in which they are located and each of them is assigned a Latin letter and a serial number corresponding to the assigned territories:

• Boston FRB (Territory No. 1, letter A);
• New York Fed (Territory No. 2, letter B);
• Philadelphia Fed (Territory No. 3, letter C);
• Cleveland Fed (Territory No. 4, letter D);
• Richmond FRB (Territory No. 5, letter E);
• Atlanta Fed (Territory No. 6, letter F);
• Chicago Fed (Territory No. 7, letter G);
• FRB St. Louis (Territory No. 8, letter H);
• Minneapolis Fed (Territory No. 9, letter I);
• Kansas City Fed (Territory No. 10, letter J);
• Dallas Fed (Territory No. 11, letter K);
• San Francisco Fed (Territory No. 1, letter L);

FRBs are joint-stock companies whose shareholders are banks that are members of the Fed in that district. These banks delegate 6 out of 9 representatives to the governing board of the FRB. The first 3 members of the governing board (class A) are selected by the member banks of the FRS from among their own representatives, one each from large, medium and small banks. According to the same scheme, class B managers are selected. From each category of banks, a representative not connected with the banking system is delegated. Usually they represent large industrial enterprises that actively use . The remaining 3 Governing Council members (Class C) are appointed by the Fed's Governing Council. These representatives also cannot represent institutions of the country's banking system.

The main task of the Federal Reserve Banks is not to make a profit, but to accumulate strategic cash reserves. The FRB lends to commercial banks and provides financial services to the US government, issuing and accepting cash and securities. The Federal Reserve Banks are the controlling body for the economic and financial institutions located in the territories assigned to them.

Fed member banks

About half of all commercial banks in the country are member banks of the Fed. These include the largest financial institutions, which account for more than 70% of the deposits of the entire US credit system.

FRS member banks are required to place in the Federal Reserve Bank, to which they are assigned, funds in the amount of 6% of their own capital. These amounts are the main assets of the FRB. In return, Fed member banks receive a fixed annual FRB rate of 6%. The advantage of membership in the Fed is the possibility of obtaining a loan on more favorable terms, with virtually no restrictions. And the main drawback is the need to keep part of your capital in the form of a non-profitable reserve.

The Board of Governors is the highest governing body of the Fed. It consists of 7 permanent members who are appointed by the President of the United States after approval by the Senate. Each member of the Board of Governors is appointed for 14 years, but after they have served the current two-year semester, they may resign. A member of the Council may extend his tenure at the expense of additional semesters.

The Fed's Board of Governors is chaired by a chairman appointed by the president for a four-year term. For the same term, the Vice-Chairman is appointed by the President. The record for the number of years spent in the chair of the Board of Governors of the Fed belongs to William Martin, who held this position from 1951 to 1970. He was appointed by Presidents Truman, Eisenhower, Kennedy and Johnson and served a full term of 14 years and a few extra semesters.

The Board of Governors oversees the activities of the 12 Federal Reserve Banks. Each bank is required to coordinate its annual budget with the Board. In addition, the Board of Governors approves the appointment of the President and Vice President of each FRB. In relation to the member banks of the Fed, the Board of Governors performs a supervisory and regulatory function in relation to their international activities. The Council also establishes restrictions on the use of loans for the purchase and sale of securities.

Each week, the Fed's Board of Governors reports to Congress on its activities. In addition, 2 times a year, congressmen are provided with a report on the state of the country's economy. Statistical data concerning the US banking system are published in a special bulletin of the FRS.

The current composition of the Board of Governors of the Federal Reserve System:

• Janet Yellen - Chairman;
• Stanley Fischer - Vice Chairman;
• Daniel Tarullo;
• Lyell Brainar;
• Jerome Powell.

Two seats are currently vacant.

Federal Open Market Committee

The Federal Open Market Committee consists of 12 voting members:

• 7 members of the Board of Governors of the Fed;
• President of the New York Federal Reserve Bank;
• 4 FRB presidents. They are elected to the committee on an annual basis on a rotation basis.

The other presidents of the Federal Reserve Banks also attend committee meetings and participate in the discussion of current issues, but do not have the right to vote.

Meetings of the Federal Open Market Committee are held 8 times a year. Each meeting develops a current strategy for the open securities market. After that, the decision is communicated by directive to the manager of the System Open Market Account, who is concurrently the vice president of the FRB of New York. In accordance with the instructions received, the New York Federal conducts transactions for the sale or purchase of securities of the US Federal Government. In addition, issues related to the state's monetary policy and the prospects for economic growth are discussed at the FCOR meetings.

The Federal Advisory Board is the Fed's coordinating body, which was created to improve interaction between the entire US banking industry and the Federal Reserve System.

The Board consists of 12 members, one representative from each Federal Reserve Bank. The Council meets once a quarter to discuss the current situation in the financial market. Decisions made at a meeting of the advisory board are advisory and therefore the Board of Governors of the FRS is not obliged to implement them.

Fed activities

The US Federal Reserve acts as the central bank of the state. Among the priority tasks of this financial structure are the following:

• Issue of funds;
• Maintaining a balance between state interests and the interests of commercial banks;
• Providing financial state guarantees;
• commercial banks and financial organizations;
• Control over the activities of banking institutions;
• Provision of custody services for the US government and international financial institutions;
• Regulation and control of financial markets.

As a tool to influence the currency, the Fed uses traditional methods: interest rate management and operations with securities on the open market.

Federal Reserve Independence

The Fed is often referred to as a "state within a state." The balance sheet of the Federal Reserve is almost $4 trillion. dollars, and the main part of the assets, about 85%, is invested in the US government. At the same time, the Fed's shareholders are representatives of private capital.

Control over the activities of this financial institution is carried out by the House of Representatives of the Congress and the Banking Committee of the Congress. Thus, the Fed is essentially a working body of the US Congress, to which it reports for its work. Congressmen very jealously guard their power over the Federal Reserve System and often challenge executive decisions regarding the activities of the Fed.

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An organization that functions as the Central Bank of the United States. An independent body within the US government.

Source: https://www.youtube.com/watch?v=KggHsajMwYo

Janet Yellen has been the Fed Chair since February 2015.

History of the Fed

The Fed began in 1913 with the passage of the Federal Reserve Act. Prior to the creation of the Fed, there was a system of private banks that proved unable to create an efficient centralized country. The creation of the Fed was the result of counteracting a series of interbank crises in 1873, 1893 and 1907, because of which the need for a single regulatory and issuing body became obvious.

Composition of the Federal Reserve System

The Fed includes 12 federal reserve banks located in major cities, about three thousand commercial so-called member banks, a presidentially appointed Board of Governors (consists of seven people appointed by the US president and approved by Congress for a period of 14 years) market and advisory advice.

Functions of the Federal Reserve System

• fulfillment of the tasks of the Central Bank of the country;
• maintaining a balance between the public interest in the US and the interests of commercial banks;
• supervision and regulation of the banking system of the country, protection of the interests of investors and clients;
• issue of money - US dollars;
• regulation and stabilization of financial markets, risk control;
• provision of custody services for the US government and official international institutions;
• participation in the functioning of the system of international and domestic payments;
• elimination of liquidity problems at the local level and provision of loans to credit institutions;
• strengthening the US role in .

Features of the Fed

The main feature is that the system is built not on state, but on private capital.

Control over the activities of the Fed is carried out by the House of Representatives of the US Congress, to which it is necessary to report annually, and the Banking Committee of the Congress (report twice a year). The Fed is audited annually. In addition, the US president can legally fire any Fed governor, but this rule has never been enforced to date.

Part of the Fed's profits received on government securities, as well as as a result of operations on open markets, is used to pay salaries to employees, dividends to banks participating in the system. The main share of income is transferred to the federal budget.

The Federal Reserve Bank (Federal Reserve Bank) is a specific regional bank in the United States, created on the basis of the Federal Reserve Act. 12 regional banks form the basis of the structure of the US Federal Reserve System.
Banks have the status of an independent legal entity, but they report to and are subject to the Board of Governors of the Federal Reserve, appointed by the US President and approved by the US Senate.
How it was created and why, as well as who manages it, read below...

In 1790, less than 3 years after the signing of the Constitution, Alexander Hamilton was appointed First Secretary of the Treasury and proposed a bill for a new private central bank to Congress. After a year of heated debate, in 1791 Congress approved a bill and licensed a new bank called the First Bank of the United States for a period of 20 years. The Philadelphia-headquartered bank was given a monopoly on issuing US currency, despite the fact that 80% of its shares were to be owned by private investors, and 20% transferred to the US government. The point was to prevent the government from running the bank. Only after many years that fact became public knowledge. that the Rothschilds were behind the idea of ​​creating the First Bank of the United States.
Over the next 5 years, the US government borrowed $8.2 million from the US Bank. During the same period, the price level increased by 72%.

The United States provided Napoleon with $3 million in exchange for a huge piece (or rather, not the United States, but the Rothschilds) of American territory west of the Mississippi River that belonged to the French. The deal became known as the Louisiana Purchase. With this money, Napoleon quickly equipped an army and began to spread his influence throughout Europe. At the same time, the Bank of England provided loans to almost every country that was in the camp of Napoleon's opponents, and earned fantastic profits from the war.

Prussia, Austria and Russia got into deep debt with the Rothschilds just to stop Napoleon.
In 1811, a bill was proposed to Congress to renew the license of the Bank of the United States. A heated debate ensued, and Pennsylvania and Virginia legislators passed a resolution asking Congress to revoke the bank's license. The press corps of that time attacked the bank, openly calling it a crook, a vulture, a vampire and a cobra. Thus, if anything remained independent in America, it was the press.
A congressman named P.D. Porter launched an attack on the bank from the podium of Congress, declaring that if the bank's license was renewed, Congress "...would warm on its chest a constitutionally approved snake that, sooner or later, will bite this country in the heart and deprive it of its conquered freedom."
A number of researchers even claim that Nathan Rothschild threatened that if the banking license was not renewed, the US would bring upon itself a catastrophic war. But it did not help. When the "dust settled", the updated bill was "hacked" by the House of Representatives with a margin of 1 vote and was "slowed down" in the Senate.

And besides, the fourth American president, James Madison, runs the White House. As we remember, Madison was an ardent opponent of a private central bank. Therefore, his vice president, George Clinton, managed to cut the Gordian knot in the Senate and send the bank into oblivion.

Just 5 months later, England attacked the United States and the War of 1812 began. But the British fought with Napoleon at the same time, and therefore the war ended in a draw in 1814. And although the bankers were defeated for a while, they were still firmly afloat. It took them only 2 years to revive their bank again, even more powerful and influential than before.
In 1816, just a year after the Battle of Waterloo and the Rothschild-initiated takeover of the Bank of England, the US Congress approved a bill for another private central bank. This bank was called the "Second Bank of the United States". The charter of the new bank was an exact copy of the charters of the previous ones - 20% of the shares were transferred to the US government. And of course, the federal share was paid by the Treasury directly into the "bins" of the bank.
As one contemporary of the events put it, "...it would not be an exaggeration to say that the Bank of the United States has as much to do with Great Britain as with the United States."
Thus, according to a number of researchers, by 1816 the Rothschilds had seized control of both the Bank of England and the new private Bank of the United States. 12 years of manipulation of the US economy by the US Second Bank showed the American people who is who.
Then the opponents of the bank put forward the venerable Senator from Tennessee, the hero of the battle of New Orleans, Andrew Jackson, as a candidate for the post of President of the United States.

Initially, no one guaranteed Jackson a chance to win. After all, the bank has long since learned to manage the political process with the help of money. However, to the surprise and dismay of the Rothschilds, Jackson won the election in 1828. The latter was determined to terminate the bank's activities at the first suitable opportunity and did not abandon attempts to implement this idea.
In 1832, with new elections approaching, the bank struck a preemptive strike. He hoped that Jackson would not dare to enter into an open confrontation. The bankers persuaded Congress ahead of schedule (4 years earlier) to renew the bank's license. As you might guess, Congress gave in to their pleas and submitted the bill to the President for his signature.
However, Unbending Hickory (as the Americans called him - hickory is a kind of walnut growing in the USA), not being a coward, met their attack fully armed and vetoed the bill. The vetoed message to Congress is still one of the greatest documents in American history. It clearly argues for the responsibility of the American government to its citizens, rich and poor alike:
"Our government's bounties are rewarded not only to our citizens. More than $8 million of central bank shares are owned by foreigners... What is more dangerous to our freedom and independence than a bank that, by its origin, has so little connection with our country?"
"Giving our currency to the bank, managing the country's budget and keeping thousands of our citizens dependent on it ... is a much larger challenge and formidable danger than confronting the enemy's military power."
Jackson addressed his concerns directly to the people. For the first time in the history of the country, Jackson ran a traveling presidential campaign throughout the United States. Jackson's campaign slogan was: "Jackson and no central bank!"
As a counterweight, the national Republican Party nominated Senator Henry Klein. Despite the fact that bankers "poured" $4 million into Klein's campaign, Jackson won a second term with an overwhelming majority of votes.
The newly elected president realized that the corruption hydra was wounded, but not dead. Therefore, Jackson instructed his new Secretary of the Treasury, Louis McLane, to begin transferring government funds from the accounts of the Second Bank of the United States to more reliable credit institutions. However, McLain refused to comply. Then Jackson fired McLane and appointed William Duane as the new Secretary of the Treasury, who also refused to follow the instructions and was also fired. After the appointment of Roger Taney to this position, the latter, starting from October 1, 1833, really began to transfer funds from the accounts of the Second Bank of the USA. Jackson rejoiced: "I have a chain with which I will curb all those who resist!" However, the bank was far from defeated.
Its chairman, Nicholas Beadle, pressured Congress into protesting Taney's appointment as Secretary of the Treasury. Then, in a fit of rare arrogance. Beadle threatened to cause a depression if the bank's license was not renewed.
"If this venerable President thinks that after scalping Indians and imprisoning judges, he can arbitrarily abuse the central bank, he is delusional." Then, in a fit of revelation unprecedented for a central banker, Beadle admitted that the Bank was going to cut the money supply in order to force Congress to reopen it. "Nothing but a nationwide disaster will impress Congress ... Our only guarantee of security is to strictly follow the policy of tight containment (of the money supply) ... and I have no doubt that this will lead to the resumption of circulation of the national currency and the renewal of the bank's license" .
Beadle carried out his threats, and soon the bank actually reduced the amount of money in circulation, demanding the repayment of all loans and refusing to issue new ones. As a result, there was a panic in the financial market and a deep economic depression. Naturally, Beadle laid the blame for the economic crisis on President Jackson, justifying this by saying that the reason lies in the withdrawal of budget funds from bank accounts. Wages fell, prices and unemployment skyrocketed, not to mention the numerous bankruptcies of enterprises. The people began to murmur. Literally in every editorial of those years, the editors cursed President Jackson. In addition, the central bank has threatened to freeze payments going to support various political forces.
As a result, just a month later, Congress met for a session that was called "panic". 6 months after the transfer of government funds from the central bank accounts, Jackson was impeached with a 26:20 vote. This was the first such case in the history of the US Congress.
But a miracle happened - the governor of Pennsylvania came out in support of Jackson with serious criticism of the central bank. On top of that, Beadle was caught publicly boasting about how the bank was going to bring down the economy. This immediately changed the political balance of power. On April 4, 1834, the House of Representatives voted 134-82 against the renewal of the bank's license.
On January 8, 1835, Jackson paid off the last of the national debt. This was made possible by allowing banks to issue currency for the amount of purchased government bonds, rather than simply issuing unsecured treasuries. A few weeks later, on January 30, 1835, an assassin named Richard Lawrence fired two pistols at President Jackson, but missed both shots.
The court later found him not guilty by reason of mental insanity.
However, after his release, he boasted that some powerful Europeans ordered him to kill and promised to protect him if caught.
The following year, upon the expiration of the license, the Second Bank of the United States ceased to exist.
However, even Jackson did not have a holistic view of the true state of affairs and the real reasons for what was happening. And, although he managed to liquidate the bank, the bankers' most effective weapon - partial coverage banking - remained in the arsenal of numerous state-owned banks. This continued to fuel economic instability until the Civil War itself. However, the central bank was put out of action and, as a result, America prospered as it moved west.
All this time, the international bankers struggled to no avail to regain their former positions in America. In the end, they turned to the tried and tested recipe of central banks - to create debt and dependence, you need to start a war.
Since they couldn't get their central bank back any other way, it was decided to bring America to its knees with a civil war. In 1857, a decisive meeting of leading European bankers led by Rothschild took place in London. It was at this meeting that it was decided that the North should be pitted against the South according to the old principle of "divide and rule."

Otto von Bismarck, German Chancellor, the man who united the disparate German states into a single whole wrote: "The decision to divide the United States into federations of equal strength was taken long before the American Civil War by the highest financial circles in Europe. These bankers were afraid that if the United States survived as one state and one people, then they will be able to gain economic and financial independence, which will shake their financial power over the whole world.
A month after Abraham Lincoln's inauguration, the American Civil War began with military operations at Fort Sumtor, South Carolina on April 12, 1861.

In 1861, Lincoln and the then Secretary of the Treasury, Solomon Chase, went to New York for loans. Bankers, wanting the Union to perish, offered loans at rates ranging from 24% to 36% per annum. To which Lincoln said "thank you", I mean. "Thanks, no". Then Lincoln sent for his old friend, Colonel Dick Taylor of Chicago, and shouldered the problems of financing the war effort. Some time later, he asked Taylor what he had done. He replied: "It's very simple, dear Lincoln, get a bill through Congress to issue government bonds that have legal tender value ... and pay them to the soldiers. And with the same funds, continue to finance the war to a victorious end."
So Lincoln did. In 1862-1863. was printed on $450 million of new obligations. To distinguish it from other banknotes in circulation, their reverse side was painted green. Therefore, the new banknotes were nicknamed "greenbacks" or, translated from English, "green backs". These new banknotes paid off the troops and provided them with ammunition. During the war, $450 million worth of greenbacks were issued without paying any interest from the federal government.
Most surprisingly, an editorial in the London Times of the time explained the attitude of central bankers towards Lincoln's "greenbacks": "If this perverse financial policy that has arisen in North America is carried to its logical use. It will pay off its external debt and have no more debts. It will have the necessary funds to maintain trade and the country will become unprecedentedly rich. The minds and wealth of all countries will flow to North America. This country must be destroyed or it will destroy all the monarchies in the world" .
Lincoln was re-elected in 1864.
If he had not been killed, he would certainly have destroyed the monetary monopoly of the national banks, acquired by them during the war. In a letter to a friend dated November 21, 1864, he wrote: "The power of money hunts our people in time of peace and plots against them when there is war. It is more despotic than a monarchy, more arrogant than an autocracy, and more selfish than a bureaucracy."
On the true reasons for the assassination of President Lincoln, an article in the Vancouver Sun dated May 2, 1934 wrote: "Abraham Lincoln, who accepted the death of a martyr liberator of slaves, was killed as a result of the intrigues of a representative group of international bankers who were afraid of the plans of the President of the United States to reform the national monetary system ..."
The reason for Lincoln's assassination was not only that international bankers were eager to restore the central bank in the United States. They wanted the American currency to be based on gold. And the gold reserves were under their complete control. In other words, they wanted to put America on the gold standard. Lincoln did just the opposite - he issued banknotes ("green backs"), which were provided by the solvency and budget of the United States.
The same article noted: “These people were interested in establishing a “gold standard” monetary system and the right of bankers to manage the national currency and budget of all countries of the world. Once Lincoln was “out of the way” they had the opportunity to restore their influence in the US And they did it Just 8 years after Lincoln's assassination, silver was taken out of the US monetary system and the "gold standard" reigned here.
At the end of the 80th year, the Americans elected James Garfield as president. The new president was well aware of who was manipulating the economy. As a Congressman, he served as Chairman of the Banking and Appropriation Committee.

Immediately after his inauguration in 1881, Garfield publicly accused, alluding to the Rothschilds: “Whoever controls the money supply of any country is the complete master of its industry and commerce ... And when you understand how simply the entire economic system is somehow controlled by a few powerful people, you don't need to explain where the causes of depressions and inflations are."
On July 2, 1881, just weeks after this announcement, President Garfield was mortally wounded.
By the end of the 19th century, the Rothschild-controlled banks launched a major campaign to bring the entire US economy under their control.
The European Rothschilds financed the banks of J. P. Morgan & Co., Khun Loeb & Co., John D. Rockefeller Standard Oil Co., the Edward Harriman Railroad, and the Andrew Carnegie steel mills.
This connection was certainly more than the foundation of the American economy.
In 1900, the Rothschilds sent another agent to the US, Paul Warburg, to work with the Khun Loeb & Co. Bank. Jacob Schiff and Paul Warburg began campaigning for the creation of a "FEDERAL RESERVE BANK" as America's firmly established private central bank.
After a series of failed attempts to convince the American people of the need for a Central Bank by drawing it into a series of wars, the international bankers associated with the conspiracy decided to change their methods. To this end, instead of using wars, they began to convince gullible American citizens that they needed a central bank using artificially created depressions, recessions and panics.
It was not difficult for the Rothschilds to create a banking panic. By the very nature of banking, they knew that only a small part of the deposits placed in the bank by depositors are withdrawn by depositors on any given day. Just one financial crisis would be enough to focus the attention of the nation on the dubious need for a central bank. It was necessary to inculcate in people's minds that only the central bank was able to prevent massive bank failures.
Jacob Schiff reported in one of his speeches in 1907 to the New York Chamber of Commerce: "Unless we have a central bank with sole control over the granting of credit, this country will be plunged into the sharpest and deepest financial crisis in its history."
By 1907 it was time to revive the idea of ​​a central bank. By pooling their financial resources, Morgan and his bosses were able to covertly instigate a stock market crash. At that time, thousands of small banks across the country were experiencing a huge shortage of their own funds - thanks to the principle of working with partial coverage, the amount of reserves of many of them was less than 1%.
And just a few days after the stock market crash, people across the country rushed to withdraw money from banks at that moment Morgan went public with an offer to help the reeling American economy and "ailing" banks with money that he would create "from nothing".
And Paul Warburg said to the banking finance committee: "The first thing that came to my mind after the start of the panic was that we need a national central bank ...".
It was the worst offer ever - far worse than even partial coverage banking. But Congress supported it. Morgan printed $200 million of his unbacked private money. He supplied the economy with this paper, and sent part of it to his branches for issuing loans at interest. His plan succeeded. Soon the public regained confidence in the national currency. But as a result of all these operations, monetary power was concentrated in the hands of a few large banks.
So the American people, affected by the American Revolution, the War of 1812, Andrew Jackson's struggle with the Second Bank of the United States, the Civil War of the financial panics of 1873, 1893. and 1907, was eventually placed in such a position that he came to terms with the solution proposed by those who caused all these events.
The decision was made by the central bank. It should be noted that the conspirators did not want the American people to know that they had a central bank in store for them in the future. The law was destined to come not from the pen of a group of legislators, but from a handful of bankers, most associated with the man responsible for the panic of 1907: J.P. Morgan.
The conspiracy faced another problem. They had to avoid the name Central Bank and for this purpose they resorted to the name Federal Reserve System. It will be owned by private individuals who will profit by owning shares and control the issuance of the national currency, it - the Fed - will control all the financial resources of the country, and it will be able to mobilize and pledge the United States, dragging it into serious wars abroad.
The method used by the conspirators to deceive the American people was to divide the Federal Reserve System into twelve districts so that the American people could not call the bank a "central bank." The fact that twelve districts had one governor, called the Chairman of the Federal Reserve, obviously had to be considered irrelevant.
"The Federal Reserve was established on December 23, 1913 as a private corporation. According to the Senate Journal, it was a sunny day, most of the members of Congress had gone home for the Christmas holidays, so 3 votes of the members of the Senate were enough for the bill to be passed unanimously. If only had one of them been opposed or abstained, the law would never have passed."
The appearance of the "Federal Reserve" in 1913 allowed international bankers to greatly increase their financial power in the United States. Paul Warburg became the first president of the Federal Reserve Bank of New York.
In 1923, Charles Lindbergh, a Republican from Minnesota, literally said the following: "The financial system of the United States has been placed in the hands of the Board of Directors of the Federal Reserve. It is a private corporation created solely for the purpose of extracting maximum profit from the use of other people's money."
One of the most famous critics of the Federal Reserve, Republican from Pennsylvania and former Chairman of the Banking Committee of the US Congress during the Great Depression, Lewis McFadden, back in 1932, noted: "This country has one of the most corrupt organizations in the world. I mean the Federal Reserve.. "She let the people of the United States go around the world and practically bankrupted the government. The corrupt politics of the moneybags who control the Federal Reserve led to such results."
The "Federal Reserve" Act was followed by the 16th Amendment to the US Constitution, which now gave Congress the power to tax the personal income of American citizens.
This was due to the fact that the American Government could no longer print its own money to finance its own economy.
Thus, for the first time in the history of the United States since its founding, personal income taxes were applied there.
The leaders of the United States are the same puppets in the hands of the world's financial clans, as are the leaders of most countries on the planet.

John F. Kennedy also attempted to oppose the Rothschilds and was assassinated because he started issuing paper money issued by the US Treasury rather than the private Federal Reserve Bank.
This was a fatal blow to the invisible power of the Rothschilds. All US presidents assassinated before John F. Kennedy tried to do something similar.
It is not worth discussing the fact that, according to independent experts, Kennedy was shot from three sides, because the true cause of death, of all the murdered American presidents, is obvious.

US Federal Reserve (US Federal Reserve System, Federal Reserve, Federal Reserve System) - US Central Bank, whose decisions can affect not only the American economy, but also the world economy as a whole. This is explained simply: it is the Fed that is issuing the USD dollar, which still remains and retains its paramount importance on a planetary scale. Therefore, the Federal Reserve receives a considerable share of criticism and recommendations for managing the country's monetary policy and economy from all over the world.

History, functions and heads of the US Federal Reserve

One of the main differences between the US Federal Reserve System and central banks from other countries is its independence from the government. In some ways, the Fed is controlled by Congress, which can change its powers and duties by legislative means, but in fact the Central Bank itself sets its own monetary policy. Adds independence to the institution and the fact that the Fed not only does not receive government funding, but also brings a substantial income to the budget every year.

US Federal Reserve Building, Washington.

Independence from the federal government is also enhanced by the terms of office of members of the Fed's Board of Governors. For example, Alan Greenspan, one of the last heads of the Fed, served 19 years in office, outliving many US presidents who belonged to opposite camps.

In general, each member of the Board of Governors of the Fed, and there are seven of them, is appointed for a term of 14 years without the right to renewal. However, it is the president of the United States who chooses the governors, who then receives the approval of the Senate for this.

In 2013, the Fed celebrated a significant date - 100 years. The need to create a regulator on the eve of the First World War arose in connection with the increased panic in the country's banking sector. The US Federal Reserve became the firm hand that the country's financial market needed, bringing the required stability to it. The Central Bank of America found a balance between the interests of commercial banks and national interests, while standing up to protect the credit rights of consumers.

In addition to controlling banking institutions, the Federal Reserve System is engaged in issuing money, with the help of which it tries to solve several goals at once, sometimes conflicting with each other. So, the machine is launched when it is necessary to minimize unemployment, maintain price stability in the country, or ensure moderate interest rates. Fresh dollars are usually used to buy US Treasury debt.

Structure of the US Federal Reserve and FOMC

US Fed Chair Janet Yellen

Structurally, the US Federal Reserve consists of 12 federal banks, named after the cities in which they are located, and having their own numerical and alphabetical designation. Each regional branch has its own board of governors of 9 members. That, in turn, is divided into classes A, B and C, three people in each. Class A contains the elected representatives of the branch itself, B are employees of the non-banking sector, and C are executives appointed by the Board of Governors of the Federal Reserve. The Federal Reserve Banks implement the Fed's policy at the regional level.

Between the board of governors of the US Federal Reserve and its regional branches, the Federal Open Market Committee (FOMC) is organizationally located, which is responsible specifically for the development and proper functioning of the country. Its decisions are aimed at stimulating economic growth while maintaining the stability of prices and money circulation. The Committee consists of 12 people, including 7 members of the Fed's Board of Governors, as well as 4 presidents of the Federal Reserve Banks, elected for one year on a rotational basis, and necessarily the head of the FRB-New York. The latter is de facto the second most important in the governing structure of the Fed.

More about the US Federal Reserve

• Official website of the US Federal Reserve: www.federalreserve.gov

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