The Federal Reserve System is the central banking system of the United States of America and as such is one of the most powerful entities in the country. The Fed, as it is informally known, was created with the enactment of the Federal Reserve Act of 1913, aimed at preserving a system of checks and balances and decentralized power that was echoed in the U.S. Constitution. It was enacted largely in response to a series of financial upheavals, most notably a particularly severe panic in 1907. Throughout its existence and the existence of our country there have been numerous instances in which economic and financial turmoil has increased and as a result there has been market intervention to correct these problems before they spiral further out of control to the detriment of our countries. Over the decades, as new complications have arisen, the Fed has evolved and expanded. Initially, the Fed was supposed to be a sort of supervisor for smaller banks, keeping them afloat and holding them to strict regulations; since then it has progressed following terrible events. The Great Depression, for example, saw several changes in policy and regulation, as did the recession we recently went through. Some policies and tools used were highly controversial but, with little recourse, they were adopted. To put it mildly, the recent recession was every bit as complex and controversial as one would expect, but even more so was the Fed's course of action in attacking it. The Fed's duties today are to manage the nation's monetary policy, supervise and regulate banking institutions, and maintain the stability of the financial system. The Fed controls growth in the nation's money supply, sets reserve requirements, approves proposed mergers... middle of paper... and the financial crisis” Greater Austin Chamber of Commerce, Austin, Texas, 1 December 2008. The Wall Street Journal. http://blogs.wsj.com/economics/2008/12/01/bernankes-remarks-on-fed-policies-and-the-economy. Retrieved: October 1, 2011. “10 Important Functions Performed by the Federal Reserve That You've Never Heard of” CurrentTrading.Net. http://www.currencytrading.net/features/10-important-functions-performed-by-the- federal-reserve-that-youve-never-heard-about/ Retrieved: October 1, 2011 Merrism, Dwight. “The Cause of the Housing Bubble, Burst, and Recession Revealed: It's Managing Growth” Planetizen .planetizen.com/node/41867 Retrieved: October 1, 2011 Zandi, Mark. “FOMC Preview: All It Takes” Moody Analytics. November 1, 2010. Sad Scientist .asp?cid=194512 Retrieved: 1 October 2011