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The Federal Reserve Act of 1913 helped to establish banks as a united force working for the people instead of independent agencies working against each other. By providing a flexible amount of currency, banks did not have to hoard their money in fear of a bank run. Because of this, there was no competitive edge to see who could keep the most currency on hand and a more expansionary economy was possible...
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Because of this, there was no competitive edge to see who could keep the most currency on hand and a more expansionary economy was possible.
The evolution of the Federal Reserve did not begin on December 23, 1913 with the passage of the Federal Reserve Act. Rather, it began with the Banking Panic of 1907, the most severe of the four national banking panics that had occurred in the precious thirty-four years...
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