The Federal Reserve System of the United States of America, more commonly known by its nickname “the Fed,” is one of the most important financial institutions in the entire world. The central bank of the United States has twelve total bank branches throughout the country, corresponding to the twelve Federal Reserve districts that were apportioned by 1913’s Federal Reserve Act. These districts include the Federal Reserve Banks of: Boston, New York, Philadelphia, Cleveland, Richmond, Atlanta, Chicago, Minneapolis, St. Louis, Kansas City, Dallas, and San Francisco. The primary responsibilities of the central bank include conducting monetary policy (controlling how much money is in circulation and affecting the interest rates), regulating other banks in the country, minimizing risk in the financial system, maintaining a healthy financial system, and overseeing the payment systems of the country. Now that you know the basics, here are five interesting facts you probably didn’t know about the Fed!
1. There are people who are older than the Fed.
Founded on December 23, 1913, the Fed is currently in its 103rd year of existence. In the United States alone, there are numerous people older than this, with the oldest woman at 113 years old.
2. Federal Reserve notes have a relatively long life expectancy.
Paper currency in the US, also known as Federal Reserve notes, are reported to last at least five years. According to the Fed’s 2013 statistics, a one dollar bill lasts about 5.8 years, a five dollar bill about 5.5 years, and a twenty dollar bill 7.9 years, while the 100 dollar bill may last about fifteen years before it becomes damaged.
3. The Federal Reserve System has three parts.
The Federal Reserve Banks, the Board of Governors, and the Federal Open Market Committee (FOMC) are the parts of the Federal Reserve System. While the banks span across the country, the Board of Governors is located in Washington, D.C in two buildings: the Marriner S. Eccles building and the William McChesney Martin building. The FOMC is responsible for open-market operations, which is the purchase and sale of securities by the central bank. Open-market operations help the Fed manage monetary policy.
4. The state of Missouri is home to two of the Fed’s twelve banks!
The banks are located in both St. Louis and Kansas City.
5. Chairwoman Janet Yellen is married to another economist!
Yellen’s husband, George Akerlof, was a recipient of the Nobel Memorial Prize in Economic Sciences in 2001 after he authored the article “The Market for Lemons: Quality Uncertainty and the Market Mechanism,” which explored information asymmetry. The pair met at at lunch function at the Fed, wed in 1978, and have one son together.