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{{Organization
|OrganizationName=Federal Reserve System
|OrganizationType=Independent Agencies
|Mission=To promote the stability, integrity, and efficiency of the U.S. economy and financial system. It achieves this by conducting monetary policy, supervising financial institutions, fostering payment and settlement system safety, and promoting consumer protection and community development.
|ParentOrganization=United States Government (Independent)
|CreationLegislation=Federal Reserve Act of 1913
|Employees=19000
|Budget=Not publicly specified as a whole but self-funding through operations
|OrganizationExecutive=Chair of the Federal Reserve (Board of Governors)
|Services=Monetary policy; bank supervision; financial stability; payment services; currency issuance; economic research;
|HeadquartersLocation=38.89222, -77.04496
|HeadquartersAddress=20th St and Constitution Ave NW, Washington, DC 20551 (Board of Governors)
|Website=https://www.federalreserve.gov
}}
{{Short description|Central banking system of the US}}
{{Short description|Central banking system of the US}}
The '''Federal Reserve System''' (often shortened to the '''Federal Reserve''', or simply '''the Fed''') is the central banking system of the [[United States]]. It was created on December 23, 1913, with the enactment of the [[Federal Reserve Act]], after a series of financial panics (particularly the panic of 1907) led to the desire for central control of the monetary system in order to alleviate financial crises.{{Refn|group=list|name=need|<ref name="mnglass"/><ref name="initial"/><ref>{{Harvnb|BoG|2005 | pp=1–2}}</ref><ref name="FDS-H-04"/><ref name="FDS-H-05"/><ref name="FDS-H-06"/>}} Over the years, events such as the Great Depression in the 1930s and the Great Recession during the 2000s have led to the expansion of the roles and responsibilities of the Federal Reserve System.<ref name="initial" /><ref>{{Harvnb|BoG|2005 | pp=1}} "It was founded by Congress in 1913 to provide the nation with a safer, more flexible, and more stable monetary and financial system. Over the years, its role in banking and the economy has expanded."; {{Cite book |last=Patrick |first=Sue C. |title=Reform of the Federal Reserve System in the Early 1930s: The Politics of Money and Banking |publisher=Garland |year=1993 |isbn=978-0-8153-0970-3}}</ref>
The '''Federal Reserve System''' (often shortened to the '''Federal Reserve''', or simply '''the Fed''') is the central banking system of the [[United States]]. It was created on December 23, 1913, with the enactment of the [[Federal Reserve Act]], after a series of financial panics (particularly the panic of 1907) led to the desire for central control of the monetary system in order to alleviate financial crises.{{Refn|group=list|name=need|<ref name="mnglass"/><ref name="initial"/><ref>{{Harvnb|BoG|2005 | pp=1–2}}</ref><ref name="FDS-H-04"/><ref name="FDS-H-05"/><ref name="FDS-H-06"/>}} Over the years, events such as the Great Depression in the 1930s and the Great Recession during the 2000s have led to the expansion of the roles and responsibilities of the Federal Reserve System.<ref name="initial" /><ref>{{Harvnb|BoG|2005 | pp=1}} "It was founded by Congress in 1913 to provide the nation with a safer, more flexible, and more stable monetary and financial system. Over the years, its role in banking and the economy has expanded."; {{Cite book |last=Patrick |first=Sue C. |title=Reform of the Federal Reserve System in the Early 1930s: The Politics of Money and Banking |publisher=Garland |year=1993 |isbn=978-0-8153-0970-3}}</ref>


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The [[Federal Open Market Committee]] (FOMC) sets monetary policy by adjusting the target for the [[federal funds rate]], which generally influences [[market interest rate]]s and, in turn, US economic activity via the monetary transmission mechanism. The FOMC consists of all seven members of the board of governors and the twelve regional Federal Reserve Bank presidents, though only five bank presidents vote at a time—the president of the [[Federal Reserve Bank of New York|New York Fed]] and four others who rotate through one-year voting terms. There are also various advisory councils.{{Refn|group=list|name=pubpriv|<ref name="who_owns_faq">{{Cite web |title=FAQ – Who owns the Federal Reserve? |url=http://www.federalreserve.gov/faqs/about_14986.htm |access-date=December 1, 2015 |publisher=Federal Reserve website}}</ref><ref>{{Cite magazine |last=Lapidos |first=Juliet |date=September 19, 2008 |title=Is the Fed Private or Public? |url=http://www.slate.com/id/2200411 |magazine=Slate |access-date=August 29, 2011}}</ref><ref>{{Cite web |last=Toma |first=Mark |date=February 1, 2010 |title=Federal Reserve System |url=http://eh.net/encyclopedia/article/toma.reserve |archive-url=https://web.archive.org/web/20110513022656/http://eh.net/encyclopedia/article/toma.reserve |archive-date=May 13, 2011 |access-date=February 27, 2011 |website=EH. Net Encyclopedia |publisher=Economic History Association }}</ref><ref>{{Cite web |title=Federal Reserve System |url=https://eh.net/encyclopedia/federal-reserve-system |website=eh.net}}</ref><ref>{{Cite web |date=March 31, 2008 |title=Who owns the Federal Reserve Bank? |url=http://www.factcheck.org/2008/03/federal-reserve-bank-ownership |access-date=February 26, 2014 |website=FactCheck}}</ref>}} It has a structure unique among central banks, and is also unusual in that the [[United States Department of the Treasury]], an entity outside of the central bank, prints the [[currency]] used.<ref>{{Cite web |date=August 24, 2011 |title=Coins and Currency |url=http://www.treas.gov/topics/currency |archive-url=https://web.archive.org/web/20101203122230/http://www.treas.gov/topics/currency |archive-date=December 3, 2010 |access-date=August 29, 2011 |website=US Dept of Treasury website }}</ref>
The [[Federal Open Market Committee]] (FOMC) sets monetary policy by adjusting the target for the [[federal funds rate]], which generally influences [[market interest rate]]s and, in turn, US economic activity via the monetary transmission mechanism. The FOMC consists of all seven members of the board of governors and the twelve regional Federal Reserve Bank presidents, though only five bank presidents vote at a time—the president of the [[Federal Reserve Bank of New York|New York Fed]] and four others who rotate through one-year voting terms. There are also various advisory councils.{{Refn|group=list|name=pubpriv|<ref name="who_owns_faq">{{Cite web |title=FAQ – Who owns the Federal Reserve? |url=http://www.federalreserve.gov/faqs/about_14986.htm |access-date=December 1, 2015 |publisher=Federal Reserve website}}</ref><ref>{{Cite magazine |last=Lapidos |first=Juliet |date=September 19, 2008 |title=Is the Fed Private or Public? |url=http://www.slate.com/id/2200411 |magazine=Slate |access-date=August 29, 2011}}</ref><ref>{{Cite web |last=Toma |first=Mark |date=February 1, 2010 |title=Federal Reserve System |url=http://eh.net/encyclopedia/article/toma.reserve |archive-url=https://web.archive.org/web/20110513022656/http://eh.net/encyclopedia/article/toma.reserve |archive-date=May 13, 2011 |access-date=February 27, 2011 |website=EH. Net Encyclopedia |publisher=Economic History Association }}</ref><ref>{{Cite web |title=Federal Reserve System |url=https://eh.net/encyclopedia/federal-reserve-system |website=eh.net}}</ref><ref>{{Cite web |date=March 31, 2008 |title=Who owns the Federal Reserve Bank? |url=http://www.factcheck.org/2008/03/federal-reserve-bank-ownership |access-date=February 26, 2014 |website=FactCheck}}</ref>}} It has a structure unique among central banks, and is also unusual in that the [[United States Department of the Treasury]], an entity outside of the central bank, prints the [[currency]] used.<ref>{{Cite web |date=August 24, 2011 |title=Coins and Currency |url=http://www.treas.gov/topics/currency |archive-url=https://web.archive.org/web/20101203122230/http://www.treas.gov/topics/currency |archive-date=December 3, 2010 |access-date=August 29, 2011 |website=US Dept of Treasury website }}</ref>


The federal government sets the salaries of the board's seven governors, and it receives all the system's annual profits after dividends on member banks' capital investments are paid, and an account surplus is maintained. In 2015, the Federal Reserve earned a net income of $100.2 billion and transferred $97.7 billion to the U.S. Treasury,<ref name="frs bog net income press lease">{{Cite news |date=January 11, 2016 |title=Press Release – Federal Reserve Board announces Reserve Bank income and expense data and transfers to the Treasury for 2015 |work=Board of Governors of the Federal Reserve System |url=http://www.federalreserve.gov/newsevents/press/other/20160111a.htm |access-date=March 12, 2016}}</ref> and 2020 earnings were approximately $88.6 billion with remittances to the U.S. Treasury of $86.9 billion.<ref>{{Cite web |last=<!--Not stated--> |date=March 22, 2021 |title=Press Release - Federal Reserve System publishes annual financial statements |url=https://www.federalreserve.gov/newsevents/pressreleases/other20210322a.htm |access-date=January 4, 2022 |website=www.federalreserve.gov |publisher=Board of Governors of the Federal Reserve System}}</ref> Although an instrument of the U.S. government, the Federal Reserve System considers itself "an independent central bank because its monetary policy decisions do not have to be approved by the president or by anyone else in the executive or legislative branches of government, it does not receive funding appropriated by Congress, and the terms of the members of the board of governors span multiple presidential and congressional terms."<ref name="auto">{{Cite web |title=FAQ |url=http://www.federalreserve.gov/faqs/about_14986.htm |access-date=December 1, 2015 |website=Who Owns the Federal Reserve? |publisher=Board of Governors of the Federal Reserve System}}</ref> The Federal Reserve has been [[Criticism of the Federal Reserve|criticized by some]] for its approach to managing [[inflation]], perceived lack of transparency, and its role in economic downturns.<ref>{{Cite web |date=2015-01-27 |title=Taylor: Federal Reserve Monetary and the Financial Crisis: A Reply to Chairman Ben Bernanke - WSJ |url=https://www.wsj.com/articles/SB10001424052748703481004574646100272016422 |access-date=2024-08-22 |archive-url=https://web.archive.org/web/20150127185509/https://www.wsj.com/articles/SB10001424052748703481004574646100272016422 |archive-date=January 27, 2015 }}</ref><ref>{{Cite news |date=2024-06-22 |title=The Latest Fed Criticism? Holding on Too Tight |url=https://www.bloomberg.com/news/newsletters/2024-06-22/bloomberg-weekend-reading-the-latest-fed-criticism-holding-on-too-tight |access-date=2024-08-22 |work=Bloomberg.com |language=en}}</ref><ref>{{Cite news |date=2022-05-14 |title=More Than Half of U.S. Wants Fed Curbed or Abolished - Bloomberg |newspaper=Bloomberg |url=https://www.bloomberg.com/news/articles/2010-12-09/more-than-half-of-americans-want-fed-reined-in-or-abolished |access-date=2024-08-22 |archive-url=https://web.archive.org/web/20220514174100/https://www.bloomberg.com/news/articles/2010-12-09/more-than-half-of-americans-want-fed-reined-in-or-abolished |archive-date=May 14, 2022 }}</ref>
The federal government sets the salaries of the board's seven governors, and it receives all the system's annual profits after dividends on member banks' capital investments are paid, and an account surplus is maintained. In 2015, the Federal Reserve earned a net income of $100.2 billion and transferred $97.7 billion to the U.S. Treasury,<ref name="frs bog net income press lease">{{Cite news |date=January 11, 2016 |title=Press Release – Federal Reserve Board announces Reserve Bank income and expense data and transfers to the Treasury for 2015 |work=Board of Governors of the Federal Reserve System |url=http://www.federalreserve.gov/newsevents/press/other/20160111a.htm |access-date=March 12, 2016}}</ref> and 2020 earnings were approximately $88.6 billion with remittances to the U.S. Treasury of $86.9 billion.<ref>{{Cite web |last=<!--Not stated--> |date=March 22, 2021 |title=Press Release - Federal Reserve System publishes annual financial statements |url=https://www.federalreserve.gov/newsevents/pressreleases/other20210322a.htm |access-date=January 4, 2022 |website=www.federalreserve.gov |publisher=Board of Governors of the Federal Reserve System}}</ref> Although an instrument of the U.S. government, the Federal Reserve System considers itself "an independent central bank because its monetary policy decisions do not have to be approved by the president or by anyone else in the executive or legislative branches of government, it does not receive funding appropriated by Congress, and the terms of the members of the board of governors span multiple presidential and congressional terms."<ref name="auto">{{Cite web |title=FAQ |url=http://www.federalreserve.gov/faqs/about_14986.htm |access-date=December 1, 2015 |website=Who Owns the Federal Reserve? |publisher=Board of Governors of the Federal Reserve System}}</ref>  


== Purpose ==
== Purpose ==
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Current functions of the Federal Reserve System include:<ref name="mission"/><ref name="BoG 2006 pp=1"/>
Current functions of the Federal Reserve System include:<ref name="mission"/><ref name="BoG 2006 pp=1"/>
* To address the problem of [[bank run|banking panics]]
* To address the problem of banking panics
* To serve as the [[central bank]] for the United States
* To serve as the central bank for the United States
* To strike a balance between private interests of banks and the centralized responsibility of government
* To strike a balance between private interests of banks and the centralized responsibility of government
** To supervise and regulate banking institutions
** To supervise and regulate banking institutions
** To protect the credit rights of consumers
** To protect the credit rights of consumers


* To conduct [[monetary policy]] by influencing [[market interest rate]]s to achieve the sometimes-conflicting goals of
* To conduct monetary policy by influencing market interest rates to achieve the sometimes-conflicting goals of
** maximum employment
** maximum employment
** stable prices, interpreted as an [[inflation]] rate of 2 percent per year on average<ref name="goals of MP" />
** stable prices, interpreted as an [[inflation]] rate of 2 percent per year on average<ref name="goals of MP" />
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In late December 2011, President [[Barack Obama]] nominated [[Jeremy C. Stein]], a [[Harvard University]] finance professor and a [[Democratic Party of the United States|Democrat]], and [[Jerome Powell]], formerly of [[Dillon Read]], [[Bankers Trust]]<ref name=MW01/> and [[The Carlyle Group]]<ref>{{Cite web |title="Jerome Powell: Visiting Scholar" |url=http://www.bipartisanpolicy.org/about/economic-policy-project/jerome-powell |archive-url=https://web.archive.org/web/20111221012845/http://www.bipartisanpolicy.org/about/economic-policy-project/jerome-powell |archive-date=December 21, 2011}}</ref> and a [[Republican Party of the United States|Republican]]. Both candidates also have [[United States Treasury|Treasury Department]] experience in the Obama and [[George H. W. Bush]] administrations respectively.<ref name="MW01">Goldstein, Steve (December 27, 2011). [http://www.marketwatch.com/story/obama-to-nominate-stein-powell-to-fed-board-2011-12-27?link=MW_home_latest_news "Obama to nominate Stein, Powell to Fed board"]. ''MarketWatch''. Retrieved December 27, 2011.</ref>
In late December 2011, President [[Barack Obama]] nominated [[Jeremy C. Stein]], a [[Harvard University]] finance professor and a [[Democratic Party of the United States|Democrat]], and [[Jerome Powell]], formerly of [[Dillon Read]], [[Bankers Trust]]<ref name=MW01/> and [[The Carlyle Group]]<ref>{{Cite web |title="Jerome Powell: Visiting Scholar" |url=http://www.bipartisanpolicy.org/about/economic-policy-project/jerome-powell |archive-url=https://web.archive.org/web/20111221012845/http://www.bipartisanpolicy.org/about/economic-policy-project/jerome-powell |archive-date=December 21, 2011}}</ref> and a [[Republican Party of the United States|Republican]]. Both candidates also have [[United States Treasury|Treasury Department]] experience in the Obama and [[George H. W. Bush]] administrations respectively.<ref name="MW01">Goldstein, Steve (December 27, 2011). [http://www.marketwatch.com/story/obama-to-nominate-stein-powell-to-fed-board-2011-12-27?link=MW_home_latest_news "Obama to nominate Stein, Powell to Fed board"]. ''MarketWatch''. Retrieved December 27, 2011.</ref>


"Obama administration officials [had] regrouped to identify Fed candidates after [[Peter Diamond]], a Nobel Prize-winning economist, withdrew his nomination to the board in June [2011] in the face of Republican opposition. [[Richard Clarida]], a potential nominee who was a Treasury official under [[George W. Bush]], pulled out of consideration in August [2011]", one account of the December nominations noted.<ref>Lanman, Scott; Runningen, Roger (December 27, 2011). [https://www.bloomberg.com/news/2011-12-27/obama-to-nominate-jerome-powell-jeremy-stein-to-fed-s-board-of-governors.html "Obama to Choose Powell, Stein for Fed Board"]. Bloomberg LP. Retrieved December 27, 2011.</ref> The two other Obama nominees in 2011, [[Janet Yellen]] and [[Sarah Bloom Raskin]],<ref>Robb, Greg (April 29, 2010). [http://www.marketwatch.com/story/obama-nominates-3-to-federal-reserve-board-2010-04-29 "Obama nominates 3 to Federal Reserve board"]. ''[[MarketWatch]]''. Retrieved April 29, 2010.</ref> were confirmed in September.<ref>Lanman, Scott (September 30, 2010). [https://www.bloomberg.com/news/2010-09-30/yellen-raskin-win-fed-board-confirmation-as-vote-on-monetary-easing-nears.html "Yellen, Raskin Win Senate Approval for Fed Board of Governors"]. Bloomberg LP. Retrieved December 27, 2011.</ref> One of the vacancies was created in 2011 with the resignation of [[Kevin Warsh]], who took office in 2006 to fill the unexpired term ending January 31, 2018, and resigned his position effective March 31, 2011.<ref>Censky, Annalyn (February 10, 2011). [https://money.cnn.com/2011/02/10/news/economy/fed_official_warsh_resigns/index.htm "Fed inflation hawk Warsh resigns"]. ''[[CNNMoney]]''. Retrieved December 27, 2011.</ref><ref>Chan, Sewell (February 10, 2011). [https://www.nytimes.com/2011/02/11/business/economy/11fed.html "Sole Fed Governor With Close Ties to Conservatives Resigns"]. ''The New York Times''. Retrieved December 27, 2011.</ref> In March 2012, U.S. Senator [[David Vitter]] ([[Republican Party of the United States|R]], [[Louisiana|LA]]) said he would oppose Obama's Stein and Powell nominations, dampening near-term hopes for approval.<ref>Robb, Greg (March 28, 2012). [http://www.marketwatch.com/story/senator-to-block-quick-vote-on-fed-picks-report-2012-03-28?link=MW_latest_news "Senator to block quick vote on Fed picks: report"]. ''MarketWatch''. Retrieved March 28, 2012.</ref> However, Senate leaders reached a deal, paving the way for affirmative votes on the two nominees in May 2012 and bringing the board to full strength for the first time since 2006<ref>Robb, Greg, [http://www.marketwatch.com/story/stein-sworn-in-as-fed-governor-2012-05-30 "Stein sworn in as Fed governor"], ''MarketWatch'', May 30, 2012. Retrieved May 30, 2012.</ref> with Duke's service after term end.  Later, on January 6, 2014, the United States Senate confirmed Yellen's nomination to be chair of the Federal Reserve Board of Governors; she was the first woman to hold the position.<ref>{{Cite news |last=Lowrey |first=Annie |date=January 6, 2014 |title=Senate Confirms Yellen as Fed Chairwoman |work=The New York Times |url=https://www.nytimes.com/2014/01/07/business/economy/Yellen-Senate-Vote.html |url-status=live |url-access=limited |access-date=January 6, 2014 |archive-url=https://ghostarchive.org/archive/20220102/https://www.nytimes.com/2014/01/07/business/economy/Yellen-Senate-Vote.html |archive-date=January 2, 2022}}{{Cbignore}}</ref> Subsequently, President Obama nominated [[Stanley Fischer]] to replace Yellen as the vice-chair.<ref>{{Cite news |last=Puzzanghera |first=Jim |date=January 10, 2014 |title=Obama to nominate Stanley Fischer, 2 others to Federal Reserve seats |url=https://www.latimes.com/business/la-fi-mo-federal-reserve-stanley-fischer-obama-nominate-lael-brainard-20140110-story.html |access-date=December 26, 2021}}</ref>
"Obama administration officials [had] regrouped to identify Fed candidates after [[Peter Diamond]], a Nobel Prize-winning economist, withdrew his nomination to the board in June [2011] in the face of Republican opposition. [[Richard Clarida]], a potential nominee who was a Treasury official under George W. Bush, pulled out of consideration in August [2011]", one account of the December nominations noted.<ref>Lanman, Scott; Runningen, Roger (December 27, 2011). [https://www.bloomberg.com/news/2011-12-27/obama-to-nominate-jerome-powell-jeremy-stein-to-fed-s-board-of-governors.html "Obama to Choose Powell, Stein for Fed Board"]. Bloomberg LP. Retrieved December 27, 2011.</ref> The two other Obama nominees in 2011, [[Janet Yellen]] and [[Sarah Bloom Raskin]],<ref>Robb, Greg (April 29, 2010). [http://www.marketwatch.com/story/obama-nominates-3-to-federal-reserve-board-2010-04-29 "Obama nominates 3 to Federal Reserve board"]. ''[[MarketWatch]]''. Retrieved April 29, 2010.</ref> were confirmed in September.<ref>Lanman, Scott (September 30, 2010). [https://www.bloomberg.com/news/2010-09-30/yellen-raskin-win-fed-board-confirmation-as-vote-on-monetary-easing-nears.html "Yellen, Raskin Win Senate Approval for Fed Board of Governors"]. Bloomberg LP. Retrieved December 27, 2011.</ref> One of the vacancies was created in 2011 with the resignation of [[Kevin Warsh]], who took office in 2006 to fill the unexpired term ending January 31, 2018, and resigned his position effective March 31, 2011.<ref>Censky, Annalyn (February 10, 2011). [https://money.cnn.com/2011/02/10/news/economy/fed_official_warsh_resigns/index.htm "Fed inflation hawk Warsh resigns"]. ''[[CNNMoney]]''. Retrieved December 27, 2011.</ref><ref>Chan, Sewell (February 10, 2011). [https://www.nytimes.com/2011/02/11/business/economy/11fed.html "Sole Fed Governor With Close Ties to Conservatives Resigns"]. ''The New York Times''. Retrieved December 27, 2011.</ref> In March 2012, U.S. Senator [[David Vitter]] ([[Republican Party of the United States|R]], [[Louisiana|LA]]) said he would oppose Obama's Stein and Powell nominations, dampening near-term hopes for approval.<ref>Robb, Greg (March 28, 2012). [http://www.marketwatch.com/story/senator-to-block-quick-vote-on-fed-picks-report-2012-03-28?link=MW_latest_news "Senator to block quick vote on Fed picks: report"]. ''MarketWatch''. Retrieved March 28, 2012.</ref> However, Senate leaders reached a deal, paving the way for affirmative votes on the two nominees in May 2012 and bringing the board to full strength for the first time since 2006<ref>Robb, Greg, [http://www.marketwatch.com/story/stein-sworn-in-as-fed-governor-2012-05-30 "Stein sworn in as Fed governor"], ''MarketWatch'', May 30, 2012. Retrieved May 30, 2012.</ref> with Duke's service after term end.  Later, on January 6, 2014, the United States Senate confirmed Yellen's nomination to be chair of the Federal Reserve Board of Governors; she was the first woman to hold the position.<ref>{{Cite news |last=Lowrey |first=Annie |date=January 6, 2014 |title=Senate Confirms Yellen as Fed Chairwoman |work=The New York Times |url=https://www.nytimes.com/2014/01/07/business/economy/Yellen-Senate-Vote.html |url-status=live |url-access=limited |access-date=January 6, 2014 |archive-url=https://ghostarchive.org/archive/20220102/https://www.nytimes.com/2014/01/07/business/economy/Yellen-Senate-Vote.html |archive-date=January 2, 2022}}{{Cbignore}}</ref> Subsequently, President Obama nominated [[Stanley Fischer]] to replace Yellen as the vice-chair.<ref>{{Cite news |last=Puzzanghera |first=Jim |date=January 10, 2014 |title=Obama to nominate Stanley Fischer, 2 others to Federal Reserve seats |url=https://www.latimes.com/business/la-fi-mo-federal-reserve-stanley-fischer-obama-nominate-lael-brainard-20140110-story.html |access-date=December 26, 2021}}</ref>


In April 2014, Stein announced he was leaving to return to Harvard on May 28 with four years remaining on his term. At the time of the announcement, the FOMC "already is down three members as it awaits the Senate confirmation of ... Fischer and [[Lael Brainard]], and as [President] Obama has yet to name a replacement for ... Duke. ... Powell is still serving as he awaits his confirmation for a second term."<ref>Goldstein, Steve, [http://www.marketwatch.com/story/jeremy-stein-to-resign-from-federal-reserve-2014-04-03 "Jeremy Stein to resign from Federal Reserve"], ''[[MarketWatch]]'', April 3, 2014. Retrieved April 3, 2014.</ref>
In April 2014, Stein announced he was leaving to return to Harvard on May 28 with four years remaining on his term. At the time of the announcement, the FOMC "already is down three members as it awaits the Senate confirmation of ... Fischer and [[Lael Brainard]], and as [President] Obama has yet to name a replacement for ... Duke. ... Powell is still serving as he awaits his confirmation for a second term."<ref>Goldstein, Steve, [http://www.marketwatch.com/story/jeremy-stein-to-resign-from-federal-reserve-2014-04-03 "Jeremy Stein to resign from Federal Reserve"], ''[[MarketWatch]]'', April 3, 2014. Retrieved April 3, 2014.</ref>
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{{Main|History of central banking in the United States}}
{{Main|History of central banking in the United States}}


The first attempt at a national currency was during the [[American Revolutionary War]]. In 1775, the Continental Congress, as well as the states, began issuing paper currency, calling the bills "[[Early American currency|Continentals]]".<ref>{{Cite web |title=Timeline of U.S. Currency History |url=https://uscurrency.gov/history-american-currency |archive-url=https://web.archive.org/web/20161004114334/https://uscurrency.gov/history-american-currency |archive-date=October 4, 2016 |access-date=June 8, 2016 |publisher=U.S. Currency Education Program}}</ref> The Continentals were backed only by future tax revenue, and were used to help finance the Revolutionary War. Overprinting, as well as British counterfeiting, caused the value of the Continental to diminish quickly. This experience with paper money led the United States to strip the power to issue Bills of Credit (paper money) from a draft of the new Constitution on August 16, 1787,<ref>{{Cite web |title="Mr. Govr. MORRIS moved to strike out "and emit bills on the credit of the U. States" – If the United States had credit such bills would be unnecessary: if they had not, unjust & useless. ... On the motion for striking out N. H. ay. Mas. ay. Ct ay. N. J. no. Pa. ay. Del. ay. Md. no. Va. ay. N. C. ay. S. C. ay. Geo. ay." |url=http://avalon.law.yale.edu/18th_century/debates_816.asp |access-date=April 30, 2012 |publisher=Avalon.law.yale.edu}}</ref> as well as banning such issuance by the various states, and limiting the states' ability to make anything but gold or silver coin legal tender on August 28.<ref>US Constitution Article 1, Section 10. "no state shall ..emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts;"</ref>
The first attempt at a national currency was during the American Revolutionary War. In 1775, the Continental Congress, as well as the states, began issuing paper currency, calling the bills "[[Early American currency|Continentals]]".<ref>{{Cite web |title=Timeline of U.S. Currency History |url=https://uscurrency.gov/history-american-currency |archive-url=https://web.archive.org/web/20161004114334/https://uscurrency.gov/history-american-currency |archive-date=October 4, 2016 |access-date=June 8, 2016 |publisher=U.S. Currency Education Program}}</ref> The Continentals were backed only by future tax revenue, and were used to help finance the Revolutionary War. Overprinting, as well as British counterfeiting, caused the value of the Continental to diminish quickly. This experience with paper money led the United States to strip the power to issue Bills of Credit (paper money) from a draft of the new Constitution on August 16, 1787,<ref>{{Cite web |title="Mr. Govr. MORRIS moved to strike out "and emit bills on the credit of the U. States" – If the United States had credit such bills would be unnecessary: if they had not, unjust & useless. ... On the motion for striking out N. H. ay. Mas. ay. Ct ay. N. J. no. Pa. ay. Del. ay. Md. no. Va. ay. N. C. ay. S. C. ay. Geo. ay." |url=http://avalon.law.yale.edu/18th_century/debates_816.asp |access-date=April 30, 2012 |publisher=Avalon.law.yale.edu}}</ref> as well as banning such issuance by the various states, and limiting the states' ability to make anything but gold or silver coin legal tender on August 28.<ref>US Constitution Article 1, Section 10. "no state shall ..emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts;"</ref>


In 1791, the government granted the [[First Bank of the United States]] a charter to operate as the U.S. central bank until 1811.<ref name="A Brief History of Our Nation's Paper Money">{{Cite web |last=Flamme |first=Karen |title=1995 Annual Report: A Brief History of Our Nation's Paper Money |url=http://www.frbsf.org/publications/federalreserve/annual/1995/history.html |archive-url=https://web.archive.org/web/20100227093922/http://www.frbsf.org/publications/federalreserve/annual/1995/history.html |archive-date=February 27, 2010 |access-date=August 26, 2010 |publisher=Federal Reserve Bank of San Francisco}}</ref> The First Bank of the United States came to an end under [[James Madison|President Madison]] when Congress refused to renew its charter. The [[Second Bank of the United States]] was established in 1816, and lost its authority to be the central bank of the U.S. twenty years later under [[Andrew Jackson|President Jackson]] when its charter expired. Both banks were based upon the Bank of England.<ref>{{Cite book |url=https://books.google.com/books?id=EkUTaZofJYEC |title=British Parliamentary reports on international finance: the Cunliffe Committee and the Macmillan Committee reports |publisher=Ayer Publishing |year=1978 |isbn=978-0-405-11212-6 |quote=description of the founding of Bank of England: 'Its foundation in 1694 arose out the difficulties of the Government of the day in securing subscriptions to State loans. Its primary purpose was to raise and lend money to the State and in consideration of this service it received under its Charter and various Act of Parliament, certain privileges of issuing bank notes. The corporation commenced, with an assured life of twelve years after which the Government had the right to annul its Charter on giving one year's notice. Subsequent extensions of this period coincided generally with the grant of additional loans to the State'}}</ref> Ultimately, a third national bank, known as the Federal Reserve, was established in 1913 and still exists to this day.
In 1791, the government granted the [[First Bank of the United States]] a charter to operate as the U.S. central bank until 1811.<ref name="A Brief History of Our Nation's Paper Money">{{Cite web |last=Flamme |first=Karen |title=1995 Annual Report: A Brief History of Our Nation's Paper Money |url=http://www.frbsf.org/publications/federalreserve/annual/1995/history.html |archive-url=https://web.archive.org/web/20100227093922/http://www.frbsf.org/publications/federalreserve/annual/1995/history.html |archive-date=February 27, 2010 |access-date=August 26, 2010 |publisher=Federal Reserve Bank of San Francisco}}</ref> The First Bank of the United States came to an end under [[James Madison|President Madison]] when Congress refused to renew its charter. The [[Second Bank of the United States]] was established in 1816, and lost its authority to be the central bank of the U.S. twenty years later under [[Andrew Jackson|President Jackson]] when its charter expired. Both banks were based upon the Bank of England.<ref>{{Cite book |url=https://books.google.com/books?id=EkUTaZofJYEC |title=British Parliamentary reports on international finance: the Cunliffe Committee and the Macmillan Committee reports |publisher=Ayer Publishing |year=1978 |isbn=978-0-405-11212-6 |quote=description of the founding of Bank of England: 'Its foundation in 1694 arose out the difficulties of the Government of the day in securing subscriptions to State loans. Its primary purpose was to raise and lend money to the State and in consideration of this service it received under its Charter and various Act of Parliament, certain privileges of issuing bank notes. The corporation commenced, with an assured life of twelve years after which the Government had the right to annul its Charter on giving one year's notice. Subsequent extensions of this period coincided generally with the grant of additional loans to the State'}}</ref> Ultimately, a third national bank, known as the Federal Reserve, was established in 1913 and still exists to this day.
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