What is the Federal Reserve System?

The Federal Reserve System, commonly referred to as the Fed, is the central banking system in the United States and is responsible for managing the country’s monetary policy and regulating the banking industry. Established in 1913, the Fed is composed of 12 regional Federal Reserve Banks that are located throughout the country and the Board of Governors based in Washington, D.C. The Federal Reserve System works to ensure an economy that is stable, efficient, and secure. It does this by carrying out a variety of responsibilities, such as setting interest rates, regulating the banking industry, overseeing the clearinghouse of payments, and managing the nation’s money supply. The Fed also serves as a lender of last resort for banks that are in danger of failing. The Federal Reserve System is a vitally important part of banking law in Texas and the rest of the United States. It works to keep the banking system functioning and to manage the money supply. This helps ensure that businesses, households, and state and local governments have the money they need to make purchases and investments. By working to keep the economy healthy, the Federal Reserve System helps protect consumers from financial harm.

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What is the Federal Reserve System?

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