On February 4, Daniel O. Beltran, PhD, deputy associate director for international finance at the Federal Reserve, launched the 2026 CoBIT lecture series with a compelling presentation which “demystified” the Fed.
By the time the first few slides appeared, students were already raising their hands with questions. Beltran, who works at the Federal Reserve Board of Governors in Washington, D.C., walked the audience through the history of the Fed, its responsibilities, and how its decisions shape the U.S. economy. The event embodied CoBIT’s “Connect, Empower, Succeed” mission by connecting students with experts in the field, empowering them through real-world insights, and preparing them for future success.
What is the Federal Reserve?
To understand how the Fed shapes today’s economy, Beltran took a step back in time explaining how the Federal Reserve was created and why the country needed a system to regulate the banking industry.
Before the 1913 Federal Reserve Act, there was no central body regulating or supervising the banking system. During this time banks could open one day and go out of business the next, the economy faced many crashes, and money supply was tied to gold. The Federal Reserve was created to act as the central bank of the United States with the ability to create an elastic supply of money that met the investment needs of the economy. In 1977, the act was amended to include the two dual mandates: maximum employment and stable pricing.
The Fed is an independent agency in Washington, DC, overseeing the operations of the 12 reserve banks. “We’re independent, [but] we’re still accountable to the American people,” Beltran explained. “Twice a year, the chair of the Federal Reserve goes in front of Congress and gives a readout of the state of the economy, our monetary policies, and how our policies are addressing the economic issues to the House Banking Committee and Senate Banking committees.”
The Reserve is made up of multiple organizations with three key entities: Federal Reserve Board of Governors, 12 Federal Reserve banks, and Federal Open Market Community (FOMC). The 12 Federal Reserve banks are responsible for managing the operations within their 12 Federal Reserve districts. The FOMC is the committee in charge of setting monetary policy within the 12 districts. Additional branches can be created (within branches) if there is a surge in demand.
Board members have a 14-year term limit. If they leave during the middle of their term, the President of the United States nominates a replacement, the Senate must confirm the nominee, and the person will only serve the remainder of the original 14-year term. Chairs have a four-year term, and the president nominates their replacement, who must also go through the nomination process and be confirmed by Congress before enacting his role as the chair.
What Does the Fed Do?
Students’ curiosity about the nation’s central bank quickly became clear with hands going up throughout the room as the presentation continued. The conversation quickly turned to real impact as Beltran outlined how the Fed maintains financial stability, regulates institutions, and guides the economy.
The Fed’s main function is conducting monetary policies which promote price stability and maximum employment; maintaining stability in the financial system by monitoring financial markets; and supervising financial institutions like banks to try to prevent future financial crises from happening.
The goals of this dual mandate (maximum employment and price stability) mutually reinforce each other. If you achieve one, it will help you achieve the other mandate. For maximum employment, economists consult a wide range of indicators to get a sense of how healthy the labor market is. “It’s actually hard to figure out what the real level of maximum employment is that doesn’t generate inflation. If you are over employed, that could be inflationary, and if your unemployment is too low, that is deflationary. It’s not directly measurable,” Beltran noted.
Price stability is essential for a stable economy and for the well-being of all Americans. Increased consumption generates employment, but it can also create inflation because when people want to buy more goods and services, prices tend to rise. In this case, the economy may experience an aggregate demand shock, meaning demand is very strong and the economy is running hot. To address this, the Fed may tighten monetary policy by raising interest rates. When borrowing costs rise, consumers and businesses may reduce spending, which helps slow inflation.
The Fed controls short term interest rates, and their funds rate is the basis for other rates in the economy. “When the Fed funds rate goes up, the other rates also move. And that’s how it affects overall economic conditions,” Beltran explained.
Opportunities at the Fed
Beltran concluded the presentation by providing all attendees with information on opportunities offered at the Fed. They offer paid positions for students interested in pursuing careers in economics, finance, accounting, information systems, law, and data analysis; an economic research intern program for individuals interested in graduate study or broader research assistant programs; summer internships for graduate and graduate students; and a two-year research assistant program.
For many students in the room, the presentation offered more than just an explanation of economic policy—it also opened the door to future career opportunities with the Federal Reserve system. Events like this illustrate CoBIT’s commitment to preparing students to become leaders who understand how economic policy, business strategy, and technology shape the modern global economy.
By: Nurzahan Rahman
