What is the Federal Reserve System and how does it influence the economy?

"The Federal Reserve System, or Fed, is the central bank of the United States and consists of 12 district banks, each located in a major U.S. city. The discount rate is the interest rate that the Federal Reserve charges its member banks. Open market operations are the purchase or sale of U.S. government bonds by the Federal Reserve to stimulate or slow down the economy. The reserve requirement requires banks that are members of the Federal Reserve System to hold some of their deposits in cash in their vaults or in an account at a district bank. Selective credit controls are the power of the Federal Reserve to control consumer credit rules and margin requirements."