Is it the purpose of the Federal Reserve in the US to make sure the average family spends all their money?

Question

This ensures they don't have money to organize into a devastating rebellion. This maintains civility, right? So if they make sure the malcontents spend all available cash, they help ensure National Security inside out, right?

Answer 1

Lovely idea.

In fact, it doesn't actually say so, but it is indeed in the Feds interest to get Americans to spend their money.

The more people spend, the better the economy looks, and keeping the economy growing is one of the Federal Reserve's explicit goals.

As for the national security aspect, that part doesn't make sense to me. Would they really want the malcontents spending money on guns? radio and TV stations to get the word out? etc.? That would just start them on the sort of financial campaign that the IRA and the French malcontents  had going (banking robbing sprees); or like those in Latin America and the Middle East (kidnapping to raise cash); etc.

Answer 2

In pure economic terms, when inflation is high, I don't think the Federal Reserve would be keen to see American families spend all their money. In fact the opposite is true. The Federal Reserve wants to see spending slowed in order to stop inflation. The Federal Reserve during these periods goes through h**l to buy up all government bonds to dry up the money supply through Open Market Operations. However, In times of low inflation, spending is indeed the best for the economy.

Answer 3

The purpose of the Federal Reserve is to keep the US economy from grinding to a halt just because one financial company has a bad day.

For some reason, a lot of people spend a lot of time trying to make it more complicated than that.