As per Taxlawsinusa, The Federal Reserve Act, also known as the Glass-Owen Act, was passed on December 23, 1913. Here are the key provisions:
Structure and Organization
1. Establishment of the Federal Reserve System: Created a central banking system to provide a safer and more stable monetary and financial system.
2. Federal Reserve Board (FRB): Established a seven-member board to oversee the Federal Reserve System.
3. 12 Federal Reserve Banks: Created 12 regional Federal Reserve Banks to serve as the operating arms of the Federal Reserve System.
Monetary Policy
1. Open Market Operations: Authorized the Federal Reserve to buy and sell government securities on the open market to influence the money supply and interest rates.
2. Discount Rate: Established the discount rate, which is the interest rate charged by Federal Reserve Banks on loans to depository institutions.
3. Reserve Requirements: Authorized the Federal Reserve to set reserve requirements for depository institutions.
Banking Supervision and Regulation
1. Banking Supervision: Authorized the Federal Reserve to supervise and regulate banks and other depository institutions.
2. Membership Requirements: Established requirements for banks to become members of the Federal Reserve System.
3. Bank Examination and Enforcement: Authorized the Federal Reserve to examine banks and take enforcement actions against non-compliant institutions.
Lending and Credit
1. Discount Window: Established the discount window, which allows depository institutions to borrow money from the Federal Reserve at the discount rate.
2. Lending Authority: Authorized the Federal Reserve to lend to depository institutions and other entities under certain circumstances.
Other Provisions
1. Federal Reserve Notes: Authorized the Federal Reserve to issue Federal Reserve notes, which are the currency used in the United States.
2. Gold Reserve Requirement: Established a gold reserve requirement for Federal Reserve notes, which was later repealed.
3. Reporting Requirements: Established reporting requirements for depository institutions and other entities subject to Federal Reserve supervision and regulation.