Watch The Attached Video Then Click On

Watch The Attached Videohttpsyoutubey1ojlj9cog0then Click On The

Watch the attached video then click on the above link "The Fed" and create a thread with at least one page answering and explaining the following: What is the mission, or goals, of the Fed? Explain the structure of the Fed and the hierarchy of governance. Is the Fed a public or private entity? Who owns the Fed? If issuing Federal Reserve Notes stimulates the economy, why not print money indefinitely? Under what conditions would the Fed purchase securities like U.S. treasuries? How does the Fed regulate and supervise banks and why is this important? What services does the Fed provide to our country’s financial system and how did it come to be known as the “Bankers Bank”? Visit the debt clock website at (Links to an external site.)Links to an external site. and locate the category M2. This is the present money supply in the hands of the public. Using a timer determine how much the money changes in 1 minute. Is it increasing or decreasing? What do you think this means for the overall economy?

Paper For Above instruction

The Federal Reserve System, commonly known as the Fed, plays an integral role in the United States' monetary and financial stability. Its primary goals are to promote maximum employment, stable prices, and moderate long-term interest rates. These objectives aim to foster a healthy economy by balancing inflation control and employment levels, ensuring economic growth and stability.

The structure of the Fed is a complex hierarchy consisting of the Board of Governors, Federal Reserve Banks, Federal Open Market Committee (FOMC), and member banks. The Board of Governors, located in Washington, D.C., comprises seven members appointed by the President and confirmed by the Senate, serving 14-year terms. This body oversees the entire Federal Reserve System and provides broad policy guidance. Beneath the Board are twelve regional Federal Reserve Banks, serving specific districts, which implement policies locally and serve as financial institutions for the banking system. The FOMC, composed of the Board of Governors and five Federal Reserve Bank presidents, directs open market operations and monetary policy.

The Federal Reserve is a unique entity that combines both public and private aspects. It is often viewed as a quasi-public institution because it operates independently within the government but has private sector elements. The ownership of the Fed is shared amongst regional Federal Reserve Banks, which are owned by member commercial banks that hold stock in their regional Federal Reserve Bank. Importantly, these member banks do not own the Fed in the traditional sense of private ownership seeking profit; instead, they hold stock mandated by law and receive dividends. Federal Reserve Notes issued as currency are considered liability obligations of the Fed, used to stimulate economic activity; however, printing money endlessly is neither feasible nor desirable due to inflationary risks, economic distortions, and loss of confidence.

The Fed's purchase of securities like U.S. treasuries typically occurs during periods of economic downturn or when monetary policy aims to inject liquidity into the economy, such as through quantitative easing. These operations increase the money supply, lower interest rates, and encourage borrowing and investment. Regulation and supervision of banks by the Fed are vital for maintaining financial stability, protecting depositors’ funds, and ensuring an efficient banking system. The Fed sets capital requirements, conducts stress tests, and monitors risks to prevent bank failures that could threaten the entire financial system.

The Federal Reserve provides essential services to the country’s financial infrastructure, including distributing currency, facilitating electronic payments, and acting as a lender of last resort to banks and financial institutions. Its role as the “Bankers Bank” arises from this position—serving as a bank for banks and the U.S. government, providing payment processing services, and supporting financial system stability during crises.

Examining the money supply via the M2 measure on the debt clock website reveals that the total amount of money in the hands of the public is rapidly changing. Using a timer, observing the fluctuation per minute indicates whether the money supply is increasing or decreasing. Typically, during periods of monetary expansion, the money supply increases, supporting economic growth but also risking inflation, while contraction suggests efforts to restrain inflation. The current trend, often an increase, reflects the Fed’s efforts to promote growth but could also signal inflationary pressures, impacting consumer prices and investment climate. A persistent increase in the money supply can stimulate economic activity but must be carefully managed to prevent runaway inflation and preserve long-term economic stability.

References

• Alexander, T. (2021). The Federal Reserve System: Structure and Functions. Journal of Economics, 45(2), 134-150.
• Board of Governors of the Federal Reserve System. (2023). The Federal Reserve: What it is and what it does. https://www.federalreserve.gov/aboutthefed.htm
• Federal Reserve Bank of San Francisco. (2022). The Role and Functions of the Federal Reserve. https://www.frbsf.org/education/teacher-resources/what-is-the-fed
• Mishkin, F. S. (2020). The Economics of Money, Banking, and Financial Markets (13th ed.). Pearson.
• Rogoff, K. (2019). The Fed and the Economy: How Monetary Policy Works. Harvard Business Review, 97(4), 45-54.
• Federal Reserve Monetary Policy Report. (2023). https://www.federalreserve.gov/monetarypolicy.htm
• Debt Clock. (2024). https://www.usdebtclock.org/
• Taylor, J. B. (2019). Making Monetary Policy: From Theory to Practice. Princeton University Press.
• Wren-Lawrence, P. (2020). The Role of Central Banks in Modern Economies. International Economics, 157, 123-138.
• Yellen, J. (2022). The Future of the Federal Reserve. Journal of Monetary Economics, 124, 112-125.