Federal Reserve Note


Federal Reserve Note
The most accurate term used to describe the paper currency (dollar bills) circulated in the United States. These Federal Reserve Notes are printed by the U.S. Treasury at the instruction of the Federal Reserve member banks, who also act as the clearinghouse for local banks that need to increase or reduce their supply of cash on hand. This term is often confused with Federal Reserve Bank Notes, which were issued and redeemable only by each individual member bank, but phased out in the mid-1930s.

Prior to 1971, any Federal Reserve Note issued was theoretically backed by an equivalent amount of gold held by the U.S. Treasury. However, under President Nixon, the gold standard was officially abandoned creating a fiat currency. In other words, Federal Reserve Notes were no longer backed by hard assets. Rather, Federal Reserve Notes were now backed solely by the government's declaration that such paper money was legal tender in the United States.


Investment dictionary. . 2012.

Look at other dictionaries:

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  • Federal Reserve Note — A Federal Reserve Note (FRNs or ferns, commonly referred to as U.S. paper money, or bills, and not to be confused with Federal Reserve Bank Note ) is a type of banknote issued by the Federal Reserve System and is the only type of U.S. banknote… …   Wikipedia

  • Federal Reserve Note — Federal Reserve System …   Lexikon der Economics

  • Federal Reserve note — noun a piece of paper money (especially one issued by a central bank) he peeled off five one thousand zloty notes • Syn: ↑bill, ↑note, ↑government note, ↑bank bill, ↑banker s bill, ↑bank note, ↑banknote, ↑ …   Useful english dictionary

  • Federal Reserve note — Fin a note issued by the Federal Reserve System to increase the availability of money temporarily …   The ultimate business dictionary

  • Federal Reserve note — a form of paper money issued by a Federal Reserve Bank. * * * …   Universalium

  • Federal Reserve Note — …   Википедия

  • Federal Reserve Act — Full title An Act To provide for the establishment of Federal reserve banks, to furnish an elastic currency, to afford means of rediscounting commercial paper, to establish a more effective supervision of banking in the United States, and for… …   Wikipedia

  • Federal Reserve Bank of New York — building The Federal Reserve Bank of New York is one of the 12 Federal Reserve Banks of the United States. It is located at 33 Liberty Place, New York, NY. It is responsible for the Second District of the Federal Reserve System, which encompasses …   Wikipedia

  • Federal Reserve Bank of Minneapolis — Federal Reserve System, U.S. 9th District, seen from Hennepin Avenue …   Wikipedia


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