We Strive to Promote a Healthy Financial System
The Fed’s daily activities to conduct monetary policy, supervise and regulate banks, and provide payments services all help maintain the health and stability of the financial system. Yet occasional shocks can cause the financial system to experience distress that poses risks to the overall economy.
During these times, we have taken action to minimize disruptions to the broader economy and keep payments systems moving. For example, the Fed provided liquidity, or emergency cash, to financial markets through the discount window to eligible banks after the September 11, 2001, terrorist attacks and through special emergency lending programs during the recent financial crisis. Also, the recently enacted Dodd-Frank Act increased the Fed’s supervisory responsibilities, including for financial institutions that are systemically important. As a member on the newly created Financial Stability Oversight Council, we help to identify potential risks to the stability of the financial system and develop measures to control those risks.