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Federal Reserve System Essay

2566 Words11 Pages

The Federal Reserve System
Abdullo Djamshedovich. Abdurasulov
Howell High School
Advanced Composition
Jennifer Sebestyen
May 3, 2023

Abstract
The Federal Reserve System, established in 1913, plays a crucial role in the U.S. economy by promoting sound economic development and ensuring a reliable banking system. The Fed has two monetary policy goals - to achieve maximum sustainable employment and stable prices. Despite this, there are ongoing debates about the effectiveness of the Federal Reserve's policies, with some questioning whether they have achieved their intended outcomes. The Federal Reserve's monetary policy decisions are made by the Federal Open Market Committee (FOMC), which meets eight times a year. The FOMC sets …show more content…

Keywords: Federal Reserve System, monetary policy, interest rate, Federal Open Market Committee, financial institutions, income inequality

The Federal Reserve System
The Federal Reserve is in charge of keeping the economy healthy and controlling inflation. Yet with inflation at an all-time high, questions arise regarding whether the Federal Reserve is effectively fulfilling its mandate. Moreover, there are various conspiracy theories surrounding both the creation and current existence of the Federal Reserve System.
Composed of a central bank that plays a vital role in maintaining the economy of the United States and needs reform. It was established “To promote the development of a sound economy and a reliable banking system, Congress passed, and President Woodrow Wilson signed, the Federal Reserve Act on December 23, 1913. The act was a response to the recurring bank failures and financial panics that had plagued the nation” (Morgenstein, 2007, P. 295). Woodrow Wilson was an American politician and academic who served as the 28th President of the United States from 1913 to 1921. Wilson's life was characterized by “his unwavering commitment to the theme of democratic ideals and the expansion of democratic …show more content…

Despite being deemed unsinkable, the ship sank on its maiden voyage, even though “It was a luxurious passenger liner, which was considered to be unsinkable, due to its double-bottomed hull with sixteen watertight compartments'' (Kaufman, 2002, p. 898). One of the theories suggests that the Titanic never sank, and someone switched it with another White Star Line ship, the R.M.S. Olympic, to reap insurance money. However, there are a lot of holes in this theory, one of the biggest is that the Titanic’s insurance wasn’t enough to cover the Olympics loss. As J. Kent Layton writes in Conspiracies at Sea, “the switch conspiracy founders—quite literally—on its financial merits alone” (Little, 2018, para. 10). Another conspiracy theory that needs to be addressed is “theory suggests millionaire banker J.P. Morgan planned the disaster to kill his rivals who were aboard, while other versions blame the Rothschild banking family” (Little, 2018, para. 3). It is true that J.P. Morgan owned the Titanic and did not sail on its doomed maiden voyage, “The man who funded the building of the titanic, J. P. Morgan, canceled his long-awaited journey just hours before its proposed departure” (“Reuters Fact Check” 2021, para.3) however there is no evidence to suggest he deliberately missed the trip because he knew the ship would sink. “Historians have debated several

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