<P> William Jennings Bryan, now Secretary of State, long - time enemy of Wall Street and still a power in the Democratic party, threatened to destroy the bill . Wilson masterfully came up with a compromise plan that pleased bankers and Bryan alike . The Bryanites were happy that Federal Reserve currency became liabilities of the government rather than of private banks--a symbolic change--and by provisions for federal loans to farmers . The Bryanite demand to prohibit interlocking directorates did not pass . Wilson convinced the anti-bank Congressmen that because Federal Reserve notes were obligations of the government, the plan fit their demands . Wilson assured southerners and westerners that the system was decentralized into 12 districts, and thus would weaken New York City's Wall Street influence and strengthen the hinterlands . After much debate and many amendments Congress passed the Federal Reserve Act or Glass--Owen Act, as it was sometimes called at the time, in late 1913 . President Wilson signed the Act into law on December 23, 1913 . </P> <P> The Federal Reserve System‍--‌also known as the Federal Reserve or simply as the Fed‍--‌is the central banking system of the United States today . The Federal Reserve's power developed slowly in part due to an understanding at its creation that it was to function primarily as a reserve, a money - creator of last resort to prevent the downward spiral of withdrawal / withholding of funds which characterizes a monetary panic . At the outbreak of World War I, the Federal Reserve was better positioned than the Treasury to issue war bonds, and so became the primary retailer for war bonds under the direction of the Treasury . After the war, the Federal Reserve, led by Paul Warburg and New York Governor Bank President Benjamin Strong, convinced Congress to modify its powers, giving it the ability to both create money, as the 1913 Act intended, and destroy money, as a central bank could . </P> <P> During the 1920s, the Federal Reserve experimented with a number of approaches, alternatively creating and then destroying money which, in the eyes of Milton Friedman, helped create the late - 1920s stock market bubble . </P> <P> After Franklin D. Roosevelt took office in 1933, the Federal Reserve was subordinated to the Executive Branch, where it remained until 1951, when the Federal Reserve and the Treasury department signed an accord granting the Federal Reserve full independence over monetary matters while leaving fiscal matters to the Treasury . </P>

One reason it took so long to have a central bank in the united states is that