Tags: Money | Federal Reserve | surprising | facts

10 Surprising Facts about the Fed

By    |   Wednesday, 01 July 2015 10:13 AM

The Federal Reserve is the backbone of the financial system of the United States. Before it was created in 1913 by the Federal Reserve Act, banking in the country had been through a number of unstable incarnations of a centralized bank that led to a series of financial panics and crisis.

Many Americans are not fully aware of the importance of the Federal Reserve Bank or how it works. Here are 10 surprising facts about the Fed.

1. The Federal Reserve is mandated by law to do everything in its power to preserve high employment rates.

Watch Now: Steve Forbes Slams the Fed in This Video

2. “Paper” money is made of fabric that is 25 percent linen and 75 percent cotton, according to federalreserveeducation.org. The Federal Bureau of Engraving and Printing made bills worth $1.3 billion in the year 2013.

3. According to the U.S. Department of the Treasury, the Federal Reserve did not put the statement “In God We Trust” onto notes until the 1960s. The phrase had, however, been used on U.S. coins since the Civil War.

4. The average life expectancy of a $100 notes is 15 years, whereas the $10 note has the shortest life expectancy at about 4.5 years, according to the Fed.

5. The Federal Reserve helped keep certain banks afloat after the 9/11 terrorist attacks in 2001 by providing emergency cash.

6. The 12 Reserve Banks opened simultaneously on November 16, 1914.

7. The three directives given the Federal Reserve in monetary policy are to “promote effectively the goals of maximum employment, stable prices and moderate long-term interest rates,” according to the Federal Reserve Act.

8. The Federal Reserve offers a “discount rate” to certain financial institutions to help them in crisis. According to Bankrate, this essentially allows those institutions to borrow money directly from a Federal Reserve bank when their reserves run low. Usually banks borrow from each other. So, this kind of lending is a back-up emergency plan for banks.

New Threat: Glaziev Directive Could Instantly 'Reset' the Value of the Dollar, Destroy Wealth (See Proof)

9. The Federal Reserve has a certain minimum percentage of total deposits that a bank is required to have on hand. That is called a “reserve requirement.” It can either be stored at a Federal Reserve Bank or in an on-site vault.

10. Missouri is the only state with two Federal Reserve banks, according to Bankrate. There is one in St. Louis and one in Kansas City. While in the same state, the banks are in different districts.

© 2020 Newsmax. All rights reserved.


   
1Like our page
2Share
Money-Wire
The Federal Reserve is the backbone of the financial system of the United States. Before it was created in 1913 by the Federal Reserve Act, banking in the country had been through a number of unstable incarnations of a centralized bank.
Federal Reserve, surprising, facts
430
2015-13-01
Wednesday, 01 July 2015 10:13 AM
Newsmax Media, Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved