Government's 'fourth branch'

As a testament to its power, the US Federal Reserve has been referred to as the "fourth branch" of government.

The Fed (its headquarters, in Washington, are pictured above) was created by an act of Congress in 1913 to serve as the nation's central bank.

The 12-member Federal Open Market Committee is the Fed's policymaking arm.

Within the FOMC, the seven-member Board of Governors drives the formulation of monetary policy. Board members:

*are nomimated by the US president and confirmed by the Senate for staggered, 14-year terms;

*are intended to represent different geographical regions and different economic groups;

*set federal interest rates (in cooperation with five regional Reserve Bank presidents);

*regulate the banking industry and review new bank applications;

*supervise the regional Reserve Banks and Board staff of 1,700.

(c) Copyright 1999. The Christian Science Publishing Society