IntroductionThe Federal Reserve Act was enacted in 1913, which created the central banking system of the United States, the Federal Reserve. The Federal Reserve serves as a bank for bankers and a bank for the federal government. The Federal Reserve's goals are to create a more secure, flexible, and stable financial system. The primary responsibility of the Federal Reserve is to formulate and implement the nation's monetary policy. Another responsibility of the Federal Reserve is to supervise and regulate banking institutions and maintain consumer confidence in their practices. Additionally, the Federal Reserve provides financial services to depository institutions, the U.S. government, and foreign central banks. They clear checks, process electronic payments, and distribute money to U.S. financial institutions. The system is still intact today. The central bank is essentially independent of the political process. The Federal Reserve must regularly report to Congress to resolve significant problems the House and Senate may have. Over the years since the creation of the Federal Reserve, there have been periods of tension with Congress. In 1929, the stock market collapsed. Although the American economy entered a depression six months before the stock market crash on the New York Stock Exchange in October 1929, many still claim that the catalyst for the Great Depression was the crash itself. even. The efficient market hypothesis suggests the opposite, that the Great Depression caused the stock market crash. Before the Great Depression, government relied on “impersonal market forces to achieve the necessary economic correction.” Theorists of the efficient market hypothesis are in the middle of the article. The rule proposed by President Obama and his administration on January 21, 2010, limits how federally insured banks use their own capital to bet on the market, moving back toward a more regulated financial system like the one that once was implemented by GSA. The rationale for this proposal is to avoid the bankruptcy of banking institutions which would destabilize and harm the economy. This led many banks to fear that if the limitations, dubbed the Volcker Rule, were adopted, they would lose a substantial amount of revenue. The Volcker Rule was inspired by former Federal Reserve Chairman Paul Volcker and, as originally proposed, would prohibit bank holding companies and financial services from owning, investing in or sponsoring hedge funds, funds private equity and proprietary transactions for entities. own profit unrelated to the activity carried out to serve customers.