The Federal Reserve
                          "The safest way to double your money is to fold it over twice and put it in your pocket."
                                                                                                                    Frank McKinney Hubbard

                                By: Ashley

     The Federal Reserve System was established in 1913.   The Federal Reserve Bank is the central bank of the United States.   It distributes money for the U.S. Treasury Department who makes the money. It  supplies money to all other banks for distribution to the public.  Each bank has an account set up with the Federal Reserve Bank, and they have to pay for the money they receive .

     The public gets its money from banks by cashing checks or using automated teller machines
(ATMs).  At certain times of the week, month or year the public's need for money is greater and more money must be placed into circulation. When this happens the bank will get extra money from the Federal Reserve.  People withdraw more cash from ATMs on weekends, so there is more money in circulation on Monday than there is on Friday.  When the public demand for money is less the banks deposit their extra money at the Federal Reserve. 

 
     When the Federal Reserve receives a deposit from a bank it checks each bill to see if it's fit for circulation.  About one-third of the bills that they receive can not be placed back into circulation, so they are destroyed.   The life of a bill varies by denomination. For example, a one dollar bill gets the most amount of use, so it remains in circulation only about 18 months. 

                                                                         

    The amount of currency that banks order from the Federal Reserve has increased over the last few years due to the popularity of the ATM.  Some banks are requesting used bills instead of new ones because they work better in ATMs.  

 
    Most of the U.S. paper currency used today are Federal Reserve notes.  The Federal Reserve exchanges bills with the U.S. Treasury and promises them something of equal value.  Some of the things exchanged are U.S. Government securities, gold certificates, bills of exchange, or promissory notes.

    The Federal Reserve orders new money from the Bureau of Engraving and Printing.  After they are made, they are shipped to Reserve Banks.   Each bill costs about 4 cents to produce.

    The United States Treasury's Bureau of the Mint produces coins in San Francisco, Denver, and Philadelphia.  The coins are then shipped to the Federal Reserve Banks by armored car. 

                                                                                                   
                                 United States Federal Reserve                       United States Treasury Department