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What is the Federal Reserve System?
The Federal Reserve System was established by the Federal Reserve Act of 1913, which created a network of reserve banks that could help to prevent economic meltdowns by serving as a regulator and a source of funds.
There are 12 regional Federal Reserve Banks which monitor banks in their jurisdiction and make loans when necessary. The Federal Reserve System is sometimes referred to as one bank, but it is in fact a network of 12 banks with 24 branches, overseen by a Board with members nominated by the US Government.
The Fed, as it’s known, is meant to regulate financial instruments traded between banking institutions, to protect consumers and the economy, to assist the government and its member banks with liquidity needs and helping to control the money supply and inflation as well as interest rates.
The Fed is the Central Bank of the United States, but unlike most other central banks, it is not technically part of the government. By helping to determine the interest rate environment, it creates “tight” and “loose” monetary environments which can have a stabilizing or throttling effect on the economy and its banking institutions.
It performs stress tests on banks to ensure that they have enough capital, and it plays a role in the FDIC and international banking regulations and record-keeping.
What is the Federal Reserve Bank?
How Many Dollars do We Have in Circulation?
What is the Investment Advisor Registration Depository (IARD)?
The IARD system is maintained by FINRA, and keeps track of all adviser registrations, which states they are licensed in
What is Mortgage Interest Deduction?
Mortgage Interest Deductions are allowable income tax deductions that equal the amount of mortgage payments in a year
What is a Rate Swap?
A rate swap is an over-the-counter contract between two institutions to trade the cash flows on two principal amounts
What is Accidental Death and Dismemberment Insurance?
Accidental Death and Dismemberment (AD&D) coverage is normally offered as a rider on health or regular life insurance
Can I Withdraw Money From My Pension Plan?
In general, you can’t withdraw money from a Pension Plan before you retire
What is Return on Investment?
Return on Investment (ROI) is a ratio used to compare the net income of a project or investment to the amount invested
What are foreign exchange reserves?
Central banks and sometimes other banks and large corporations, hold reserves in foreign currencies as a hedge
What is Ex-Date?
The Ex-Date is for a stock indicates the last date of the month where a dividend is payable
What were the Biggest Insider Trading Scandals?
In 2007, Qwest Communications CEO Joseph Nacchio was convicted of making over $50 million dollars through illegal trades