The Federal Reserve is the world's most powerful financial organization and also the central bank of the United States of America. Congress formed the Federal Reserve Bank in 1913 mainly to ensure the country's monetary and financial systems were safe, flexible, and sufficiently stable. It is based on a federal system that includes both a central government institution (the board of governors) in Washington, DC, as well as 12 regional Federal Reserve banks, each of which operates in a different part of the country. Since such judgments would not have to be approved by the president or any government body, the Federal Reserve Bank has been considered independent. Although the agency is subject to legislative inspection, it should nonetheless operate within the confines of the government's economic and financial policy goals. The Federal Reserve Bank was established in 1913 as a result of repeated financial panics that affected the US economy during the previous century, resulting in major economic disruptions due to bank failures and business bankruptcies. In 1907, a serious crisis prompted the creation of an organization to prevent panics. Boston, New York, Philadelphia, Cleveland, Richmond, Atlanta, Chicago, St. Louis, Minneapolis, Kansas City, Dallas, and San Francisco are among the 12 regional federal agencies.

The Federal Reserve (the Fed) is the central bank of the United States, established in 1913 to ensure financial stability. It oversees monetary policy, regulates banks, and maintains economic growth by controlling inflation and employment levels. The Fed operates through 12 regional banks and a Board of Governors, with the Federal Open Market Committee (FOMC) setting key interest rates.

Its primary functions include managing the money supply, acting as a lender to banks during crises, and supervising the financial system. By adjusting interest rates and conducting open market operations, the Fed influences borrowing, spending, and investment. Additionally, it plays a crucial role in preventing financial panics, ensuring smooth economic operations.