December 23, 1913: The Federal Reserve


Now, here’s an anniversary you won’t find many people celebrating — and that’s really a shame. The U.S. Federal Reserve System is a great idea, copied by most other free market nations, at least in part.

You almost get the idea Americans either don’t understand the Federal Reserve, or actually oppose it.

The Federal Reserve System

Federal Reserve Building
Federal Reserve Building, Washington, D.C.
Theodor Horydczak, photographer, circa 1920-1950.
Washington as It Was, 1923-1959

On December 23, 1913, President Woodrow Wilson signed the Owen-Glass Act, creating the Federal Reserve System.

Text from the Library of Congress’s “Today in History” site.

The Federal Reserve followed the Panic of 1908. Legislators hoped the Federal Reserve Board would be able to prevent future recessions. Clearly, considering the Stock Market Crash of 1929, and the Great Depression, it didn’t work as well as hoped.

Modifications in 1933 gave it even more power. The Federal Reserve today is regarded as a model for how a government’s central bank should be operated by many economists and most other nations.

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