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- Federal Reserve
- Employing complex system is one of the main fundamental tasks that the Federal Reserve System ought to employ in its daily obligations in order to curb the operations of terrorists that might cause enormous destruction. The system ought to employ strong mechanism to make sure that there is no possibility of secondary attack. The main role of the system is to ensure that there is competent maintenance of monetary and credit conditions in the whole country (Hillman, 2007). This helps in making sure that there are favorable market conditions in all the business sectors. Most of the fields that benefit from the operations of the Federal Reserve include agricultural and industrial sectors. Another field that enjoys the role played by the system is the commercial sector. The main reason of ensuring that there is continuity of security operations is to make sure that the system does not fail to function because of encountering an attack. This is because it holds large amount of citizens and organizations’ money that circulates in the whole nation making sure that there is no inflation. Inflation would be the worst effect that might hit the country an attack occurs in the headquarters of the Federal Reserve. Therefore, the headquarters ought to have maximum security always (Hillman, 2007).
- Other duties that the Federal Reserve has an obligation of performing apart from making sure that there is no inflation in the country include lending money to the member banks and performing open-market operations. Moreover, the system is entitled to establish discount rates among performing other significant operations that contribute to improvements in the American monetary institutions. Another main additional role of the Federal Reserve is making sure that there is essential control of market structure that enhances creation of profit rather than loses. Moreover, because of the significance roles that the system plays in the American monetary variations and institutions, there is a need to ensure that there is continuity of security operations (Wells, 2004).
- The main possible influence that would affect the system if there were no backup plan in case of a catastrophe is severe depreciation. One of the main targets that terrorists employ when attacking a nation is to make sure that the citizens are not able to access money that would help them to straighten the situation of an attack (Mishkin, 2007). Failure to offer a back-up plan may cause the greatest economic depression ever experienced in America. This is because most of the banks tend to borrow money from the Federal Reserve and therefore its failure to be in operation may lead to depreciation of the monetary value. Most of the business and government activities that depends with the system in order to get money would automatically fail to achieve their target. They would even fail to perform after sometime. Another impact that the whole country might experience from the failure of the Federal Reserve to operate is collapse in the stock market prices. This is because the system plays a significant role in ensuring that operations of the stock market does not depreciate and cause many losses to the citizens. The other negative consequences of the Federal Reserve would be retrenching a number of workers. There is a clear indication that many of the workers who earn their living from the system would lose their work. This is because the system would not be able to cater for all its employees after facing a catastrophe. Most of the secondary attacks cause a lot of damage that take a country several years to recover and fully manage. This means that the system would no longer be capable of catering for all the needs of former employees leading to some of them to lose their work. Worst of all is that some of the employees would lose their lives in case an attack occurs at the headquarters (Mishkin, 2007).
- #2
- Various scenarios occurring after a successful secondary attack would result to the closure of the Federal Reserve headquarters. Most of these scenarios would cause huge effect within the first few hours after the attack. Some of the possible scenarios include loss of human lives. A truck bomber may cause a huge impact to the headquarters making every operation to come to a still. Loss of staffs that carry out several operations in the headquarters may be one of the causes that would lead to the closer of the headquarters. Another possible scenario is property damage in the headquarters. A successful attack may cause destruction of all the systems used to carry out daily activities in the institution. This means that there would be destruction of computers and other properties used for various operation. Destruction of infrastructure would be another possible scenario that would result to the closure of the headquarters. Most of the infrastructure that enhances smooth operation of the obligations that take place in the headquarters would be destroyed after a successful attack. This means that the area would be out of operation. The destruction would affect various infrastructures such as roads, electricity and water systems leading to the closure of the reserve (Matthews & John, 2005).
- Longer-term effects that would lead to the closure of the headquarters include economic implications. The attack would cause many loans and mortgages in Washington D.C to become default. The attack may also cause some of the largest insurance companies to go default. Many of the investors in the largest financial markets may be unable to achieve their contract obligations. All of these financial institutions operate with the Federal Reserve and the attack may cause them to lose much money. Their failure to operate and help the system achieve its target profit may cause to its closure. Restoring the normalcy would be difficult for the Federal Reserve because it means that it has to pay all loses encountered. The Federal Reserve is a key economic infrastructure in the American government. This means that a successful attack would result to the breakdown of the economic structure of the country (Matthews & John, 2005).
- Another long-term effect is the suffering that many of the employees located at the headquarters would get after the aftermath of the attack. Considering that some of the employees would survive the attack, they may encounter serious physical harm that would take much time to heal. This would result to the closure of the headquarters because it relies on the experienced employees to conduct all the operations. Indirect costs that would occur after the attack also would be a reason for closing the headquarters. Most of the indirect costs include deterioration of consumer and investor confidence with the system (EHRMANN & FRATZSCHER, 2007). The indirect costs would also result to reduced growth in the GPD rate of the currency making most of the services and products to cost more. This would make most of the customers fail to achieve their financial goal and hence be unable to trade with the Federal Reserve leading to its closure. Another effect of the indirect costs is losing of foreign direct investment. Moreover, indirect costs would cause changes in the inflation resulting to an increase in the number of unemployed people in the whole country. Investment and trade may go down after a successful attack leading to the closure of the headquarters. The following diagram illustrates how a successful attack would influence the economy of the country.
- Retrieved from: http://www.transnationalterrorism.eu/tekst/publications/WP5%20Del%209.pdf
- Another possible scenario that might cause the closure of the Federal Reserve is the negative effect on critical infrastructure, for example, in the financial sector. Most of the financial infrastructures get their money from the operation of the Federal Reserve. This means that a successful attack may cause the system become unable to cater for all financial infrastructures. Some of the financial infrastructures that may be affected by the attack include payment, securities and regulated markets. Moreover, clearing and settlement infrastructure may be affected by the failure of the system to operate because of the attack leading to the closure of the headquarters.
- #3
- In order to be prepared for any of the future huge disasters that may affect the Federal Reserve System, the management of the institution have serious initiatives that they ought to make. One of the initiatives is creating an incident management system. The system would take into consideration all the possible effects that would result to an attack. The system would also have the obligation of making sure that it offers all the employees the recommended skills to identify an indication of a terrorist attack. Another obligation that the system ought to consider would entail making sure that there are several devices employed in the headquarters to detect any explosive equipment near the surrounding environment (Taylor, 2006).
- The other initiative that the Federal Reserve ought to employ in order to make sure it is prepared for any attack that may come in the future is having a response plan. This means that the institution will be able to handle all the chaos and confusion that emerges after an attack. The response plan entails the organizations ability to offer effective communication to all the workers in order to make them aware what to do in case an attack occurs (Taylor, 2006).
- The other initiative that the Federal Reserve ought to make is to ensure that there is an infrastructure plan that would help in detecting all the possible attacks that might occur. Moreover, the Federal Reserve ought to make sure that it has a preparedness goal in order to achieve the obligation of ensuring that there is effectiveness in curbing the availability of an attack to occur. The main aim of having the goal is to make sure that all the set strategic plans ought to help the institution in curbing any future attack are addressed. With the help of the goal, the institution will be able to make sure that all the recommended mechanisms are addressed in the right manner and everything that would help in preventing future crime is employed in the right system (Taylor, 2006).
- The other initiative that the Federal Reserve would employ is making sure that it has the recommended planning tools that would help in preventing any future attack. This means that the institution ought to have several officials with the recommended knowledge on how to deal with various types primary and secondary attacks. The professions have an obligation of employing their experience in helping the institution to have all the necessary equipments and arrangements that would help in preventing future attacks. In order to effectively deal with the future incidents of attack, the Federal Reserve ought to have the recommended response tactics. This means that the management of the institution has an obligation of teaching all the employees on how to respond to an attack. This also means that if an attack occurs, the employees would have several tactics to use in order to minimize chances of death occurrence (Fratta, 2010).
- The Federal Reserve should employ all the above outlined initiatives in order to mitigate the hazard even though it has never happened before. This is because prevention is the best fundamental mechanism that the institution would employ to make sure that an attack might not occur in future. The advantage of the institution acting proactively towards curbing the occurrence of an attack is that there will be no interference on its daily operation. Moreover, the institution will not lose the life of any staff member because of an attack. This is because employees are the fundamental assets of any organization (Fratta, 2010).
- #4
- The appropriate plan of operation in case the Federal Reserve System headquarters were put out of commission would be finding another building to set up the institutions’ offices in order to continue offering the services that it is entitled to offer. The institution is the backbone of most financial operations that take place in Washington. Therefore, there is a need to find another more secured environment that all its operations should take place without any interference. The management of the institution should find another apartment that would be able to handle all the employees (Walker, 2009). The apartment should be near the new place of working in order to cut down various expenses such as transport costs. Relocating all the employees to one apartment would the best idea that the Federal Reserve ought to do. This is because the employees will feel more secured and the management can be able to offer the required counseling in such a time. The best location may be in Arlington, VA where security is tighter and there is availability of all the equipments that the institution would like to use. The other advantage of relocating to Arlington, VA is that the city is close to Washington D.C and therefore the employees who reside in their homes would not be required top incur more expenses like those of costs. While in Arlington, VA, the management would have ample time to construct new buildings to set offices.
- There is a need to have a parking accommodation for the contingency. This is because most of the American who works in such national institutions uses their own cars. The management has the obligation to make sure that there is ample space where all the employees can safely park their cars. Most of the clients who use the services offered by the institution use their own cars and therefore there is a need to find a parking in the new location that would accommodate all their cars. Other employees who do not have their own vehicles should receive transportation from the management of the institution. The institution offers transport services to the staff members who do not own vehicles and therefore it should continue doing the same even after experiencing the hazard. Comparing with the old location, the new one would experience a problem of overcrowding. This is because there would be more movement of vehicles and people in the new location seeking for services from the institution. However, the authorities can manage the situation and it would not take much time. Shifting the employees to other Federal Reserve Banks would not be the best solution of tackling the situation (Walker, 2009). This is because making the relocation would cause congestion in the other banks. Another significant situation that would make the option of relocating the employees to other banks fail to be the best is that the headquarters handle many obligations and therefore the move would cause congestion of services.
- #5
- There is a need to back up the computer data stored at the headquarters at an offsite location. One of the reasons why it is recommendable to use this strategy is because the information on the data will be secured in an offsite location (Anderson, 2008). All the important data should be stored at an offsite location. Several international companies that offer the services in the recommended way and therefore the organization should seek their services. The advantage of having a backup system is that the information that is of value and importance would not be lost even after the attack. Most of the information stored in the data system of the institution help in the continuity of operations that take place in all the Federal Reserve Banks. Most of this information includes databases and all the mail servers used by the institution. Other information that would be of great importance for the continuity of operations includes any user file. This means that there is an importance of having a backup system. Other important information that should be backed-up at an offsite location includes that of system databases. This means the information such as registries and user account database (Building Security Priorities in This Age of Terrorism, 2003).
- The information to be backed-up should follow a certain set of rules. This means that there is certain policies set to backup the important information. The policy defines the type of backups that the institution should use in order to secure the data (Anderson, 2008). The policy also defines a schedule for backups. According to the policy, the institution should always backup important information on daily bases. The schedule ought to be during the night because the institution has least amount of users during this time. This could not have any negative impact to the operations of the institution and would not slow down business operations. The best schedule for the backup should be at night when there are minimal activities. There is a need to have multiple safeguards for important computer data. The reason is that there is convenience and security while using safeguards. The other advantage of having multiple safeguards is that the institution will centralize access control to the data (Anderson, 2008).
- Reference
- Anderson, W. H. (2008). STAYING SAFE WITH ONLINE BACKUP AND REMOTE ACCESS SERVICES. Gpsolo, 25(8), 12-15.
- Building Security Priorities in This Age of Terrorism. (2003). Security Director's Report, 3(12), 4-6.
- EHRMANN, M., & FRATZSCHER, M. (2007). Communication by Central Bank Committee Members: Different Strategies, Same Effectiveness?. Journal Of Money, Credit & Banking (Wiley-Blackwell), 39(2/3), 509-541.
- Fratta, A. (2010). Post-9/11 Responses to Mass Casualty Bombings in Europe: Lessons, Trends and Implications for the United States. Studies In Conflict & Terrorism, 33(4), 364-385.
- Hillman, R. J. (2007). Financial Market Regulation: Agencies Engaged in Consolidated Supervision Can Strengthen Performance Measurement and Collaboration: GAO-07-154. GAO Reports, 1.
- Matthews, K. G. P., & Thompson, J. L. (2005). The economics of banking. Chichester [u.a.: Wiley.
- Mishkin, F. S. (2007). The economics of money, banking, and financial markets. Boston: Pearson/Addison Wesley.
- Taylor, E. (2006). Preparing the public for preparedness against terrorism:: [sic] FEMA's central role falling short. Internet Journal Of Rescue & Disaster Medicine, 5(2),
- Walker, C. (2009). Neighbor Terrorism and the All-Risks Policing of Terrorism. Journal Of National Security Law & Policy, 3(1), 121-168.
- Wells, D. (2004). The Federal Reserve System: A History. Jefferson, NC [u.a.: McFarland.
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