ivate business with its own president and board of directors. The board of directors has nine members, six of whom are elected by member banks. Member banks are those that belong to the Federal Reserve System. The other directors are appointed by the Board of Governors of the Federal Reserve System. Ten of the Federal Reserve Banks have branches that are closely controlled by the district banks. A Board of Governors supervises the Federal Reserve System. The Seven members of the Board of Governors are appointed by the president with the approval of Congress. The Federal Open Market Committee acts on one important part of monetary policy: the buying and selling of U.S. government securities by the Federal Reserve Banks. The Federal Advisory Council consist of 12 members who meet four times each year with the Board of Governors to discuss the economic situation and policies of the Board. A commercial bank is a type of financial institution that was originally formed to serve businesses but now provides a large number of financial services to both business customers and individuals. A demand deposit is money that must be paid upon demand by the holder of a check. A share draft account is an account with a credit union from which withdrawals easily can be made through a draft. An important feature of the U.S. system is the role played by the Federal Deposits Insurance Corporation the agency that insures deposits of individuals and businesses for up to $100,000 in the event of a bank failure. A financial intermediary is an organization that helps the flow of money from people with money save to people who needs to borrow money. A savings and loan association is a financial intermediary that mainly provides a place for people to save money and then lends that money to people to buy houses or other items. Mutual savings banks are the banks that were first formed for the same reasons as saving and loan associations and that promot...
