The Federal Reserve in Action

1. The Federal Reserve in Action 1. Sells,transfers, and redeems government securities 2. Issues paper currency 3. Acts as a clearing center for checks 4.checks up on activities of member banks by sending out bank examiners 5. Uses findings and recommendations of Reserve Banks to approve or disapprove bank mergers and bank holding company charters 6. Protects consumers by enforcing truth-in-lending laws 7. In severe recessions, provides commercial banks with emergency loans 8. Collects daily reports on banks� reserves and activities 9. May force banks to sell risky investments 10.may force problem banks to undergo more frequent examinations 11. Subjects banks that go to the Fed for emergency loans too often to financial review and close govt. supervision 12. Regulates the nation�s money supply 13. Compares M1,M2, and M3 measurements with the likely demand for money 14. Uses its tools to try to stabilize the nation�s overall economy