"As the new System was getting under way, the United States was moving into war. It is part of the favoring cliche that this was the Federal Reserve's first crisis and that it met it well. This is nonsense. The Reserve Banks bought government bonds and helped sell them as the Treasury required at the interest rates the Treasury specified. Peacetime loans to private individuals can be refused. Government loans in wartime cannot. When its rates are set and its purchases of government securities specified, a central bank has no independent power. The System began its life as a routine adjunct of the Treasury, a role that required no thought."