Banking and the Federal Reserve
Glossary
bank: A place of business that lends, exchanges, takes care of, or issues money.
charter: An official document granting, guaranteeing, or showing the limits of the rights and duties of the group to which it is given.
circulation: The passage of money from person to person or place to place.
coin: A piece of metal put out by a government authority as money.
credit: An amount that a bank or company will let a person use with the promise of future repayment.
currency: Money in circulation.
debt: Something owed to another.
Federal Reserve: The current central banking system of the United States of America.
Federal Reserve Act of 1913: Written by Senator Robert L. Owen of Oklahoma and Congressman Carter Glass, the bill created the federal reserve system of twelve districts.
interest: A charge for borrowed money that is generally a percentage of the amount borrowed.
invest: To lay out money to return a profit.
loan: Money lent at interest.
profit: The gain after all the expenses are subtracted from the amount received.
regulation: A rule or order telling how something is to be done.
run: When a large number of customers withdraw their deposits from a bank at the same time because they are worried that the financial institution might go under or close and they will lose their money.
speculation: The taking of a big risk in business in hopes of making a big profit.
spoils system: A practice where a political party, after winning an election, gives government jobs to its voters as a reward for working toward victory, and as an incentive to keep working for the party.
