You mean like the great depression which happened not long after formation, which some prominent economists have argued was exacerbated by the fed?
Things did stabilize quite a bit after we bombed the rest of the industrial world into oblivion, though, creating a period of prosperity roughly equal in expansion to the period from the end of the civil war to before the creation of the fed.
To be fair, while what you say is no doubt true, the Federal Reserve didn't gain the tools that it would now use correct for that until the mid-1930s and in some ways not until the 1950s — when the Great Depression was already well on its way to being over/was ancient history. It was something quite different leading up to/during the beginnings of the Great Depression.
And it was only after leaving the gold standard that countries started to recover:
> In the end, recovery from the Great Depression does not begin until countries give up on the combination of the Bagehot Rule and of commitment to sound gold-standard finance. Those countries that have central banks willing to print up enough money so that people are willing to spend it--it is when you adopt such policies that your economy begins to recover. If you don’t, you become France, which sticks to the gold standard all the way up to 1937, and never gets a recovery. When World War II begins, Nazi Germany’s production--equal to France's in 1933--had doubled between 1933 and 1939. French production had fallen by 15%.
It was the 'sound money' orthodoxy that everyone adhered to that made things bad, and not the Fed specifically. It's not like things were any more stable pre-Fed:
It should also be noted that how the Fed (or any central bank) was run one hundred years ago, and how it/they are run now, are two different things. We've learned a lot (sometimes through painful experience(s)) about how to run economy(s).
