The Federal Reserve's Current
THE FEDERAL RESERVE'S CURRENT MONETARY POLICY
The Federal Reserve Monetary Policy is the responsibility of the FOMC (Federal Open Market Committee), created when President Woodrow Wilson signed the Federal Reserve Act on December 23, 1913. (FRB) It took almost a year to establish the twelve regional Reserve Banks and to determine its boundaries.
The FOMC is responsible for formulation of a monetary policy designed to promote economic growth, full employment, stable prices, and a sustainable pattern of international trade and payments (FRB). The twelve districts include Boston, New York, Philadelphia, Cleveland, Richmond, Atlanta, Chicago, St. Louis, Minneapolis, Kansas City, Dallas, and San Francisco. They meet eight times a year in Washington, DC. The committee is made up of one President of the Federal Reserve Bank of New York, four other reserve bank Presidents who serve in rotation and contribute to the Committee's discussions and deliberations, there are an additional seven board members of the Board of Governs. The Directors of each Reserve Bank also make recommendations about appropriate discount rates that the Governors have final approval over. (FRBSF)
On February 1 2006, Alan Greenspan retired after 18 years of economic service the United States, but not before he pushed through a small short-term interest rate increase and insinuated that the rate increases would be coming to an end. His successor as Chairman, Board of Governors Federal Reserve System Committee, Ben Bernanke could face a time of substantial risks that increase the chances for serious missteps. According to Laurence Meyer, a former Fed governor, the challenge is in making day-to-day policy at a time when mistakes are most likely to be made. We are close in many ways to a soft landing. But that's really a razor's edge' (Andrews 2006).
According to Mr. Bernanke who testified to Congress on the present Federal Reserve's Monetary Policy on...
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