How is the Federal Reserve is Organized?
There is a great deal of confusion as to who actually runs the Federal Reserve System. The reality is that the Federal Reserve is both a private and public as well as centralized and decentralized. While the Federal Reserve can act independently from the rest of the government, it is not completely outside the influence of government. If we review the organization of the Federal Reserve System from a bottom up fashion, things will be made clear. At least as clear as any Federal bureaucracy can be. Member banks Member banks are private banks (like Bank of America or US Bank) that hold stock in one of the 12 regional Reserve Banks. All nationally chartered banks must hold stock in the Federal Reserve while state chartered banks may chose to hold stock or not if the meet certain requirements. This stock isn’t like stock on Wall Street. It cannot be sold or traded like normal stock and member banks receive fixed 6% dividends annually on this stock. Member banks have the privlidge of electi
