The Federal Reserve is a private central bank, and it is the largest holder of federal debt in the United States. It is strictly confidential to shareholders and is responsible for performing the duties of the US central bank.
The system was established on 19 13 12/23 according to the Federal Reserve Act. The core management body of the Federal Reserve is the Federal Reserve Board of Directors.
The United States Federal Reserve System consists of the Federal Reserve Board in Washington, D.C. and 65,438+02 regional federal reserve banks in major cities of China. Jerome Powell is currently the CEO of the Federal Reserve (Chairman of the Board of Directors of the Federal Reserve).
As the central bank of the United States, the Federal Reserve obtains power from the United States Congress, and exercises duties such as formulating monetary policy and supervising American financial institutions.
Limitations of the Federal Reserve:
First of all, there are many factors that affect the financial market, and the interest rate set by the Federal Reserve is only one of them. For example, a very important factor affecting the financial market is investors' judgment on the future economic situation, that is, market expectations. How the Fed's interest rate policy affects market expectations depends on investors' interpretation of the policy. Any economic policy can be interpreted in two ways: optimistic and pessimistic, which brings uncertainty after the policy is implemented.
Secondly, after the Fed adjusts the federal funds rate, there is uncertainty about how the long-term interest rate and the real economy will react.
Third, the data base of economic decision-making often lags behind, and the effect of decision-making itself also lags behind, which also makes it difficult for economic policies to take effect and withdraw.