Civics Today Citizenship, Economics, & You

"The American Financial System"

Introduction
In this chapter you read about money and the financial institutions that people use to manage their money. One of those institutions is the Federal Reserve System. The Fed was created in 1913 after a series of financial panics and bank failures. Today it oversees the amount of money in the economy, regulates the banking industry, and conducts monetary policy. In this activity you will take a closer look at this important organization.

Destination Title: Fed 101

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Directions
Start at the Federal Reserve Bank of Kansas City’s education page.

• Click on History. Explore the information on the time line.
• Click on Structure at the top of the screen. Then click on President Interviews and read the interview with the Fed president from your district.
• Click on Monetary Policy at the top of the screen. Click on and explore the link Basics of Monetary Policy.

1			What changes in banking and monetary policy occurred in 1933 in the aftermath of the Great Depression?
2			Who is the president of your Federal Reserve District? Describe this person’s background.
3			What is monetary policy?
4			What are the goals of monetary policy?
5			Click on Financial Services at the top of the screen. Follow the links to find out where a check goes after it is written. Use the information you learn from the Web site to create an illustrated flow chart of this process. Be sure to clearly explain each stage in the “life” of a check.