The Role of the Federal Reserve

AMID AN UNCERTAIN ECONOMY, MONETARY POLICY TAKES CENTER STAGE

JUDY MARTEL

When the economy gets out of whack, all eyes turn to the Federal Reserve. Officially, the Fed’s mission is to control monetary policy. But what does that mean and how effective is it? “The Federal Reserve’s primary role is to manage the supply of money in order to meet two key objectives: keep prices stable and promote maximum employment,” says Sean Snaith, director of the Institute for Economic Forecasting at the University of Central Florida. Composed of three entities, the Federal Reserve System is this country’s central bank. It includes the board of governors, the 12 regional Federal Reserve banks, and the Federal Open Market Committee. Located around the country, the regional banks clear checks and act as the eyes and ears for the board. Presidents of each bank cycle…

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Naples Illustrated (Digital) - 1 Issue, November 2022

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