After keeping the markets on edge in the days and weeks leading up to today’s decision, the Fed has decided once again to leave interest rates unchanged.

As we’ve spent this week discussing “all things Fed,” it’s worth spilling a little ink on what the quasi-government-but-really-private organization is supposed to do.

Originally, the Fed was built as a lender of last resort. In times of panic when banks needed to sell good assets for cash to meet depositor demands, someone had to be there with the ability to make good.

This is the proper role of a central bank, and is exactly what the Fed did in March 2009 when it printed $1 trillion to buy government-insured mortgage-backed bonds. Fed actions thawed the frozen market, which resuscitated the buy side and helped things return to normal, albeit at a lower level.

But over the last 100 years Congress piled other responsibilities onto the Fed, most notably full employment.

The monetary institution is supposed to use interest rates and the printing press to prod businesses into hiring more people. This part of Fed policy has failed, but you wouldn’t know it by looking at employment figures from the Bureau of Labor Statistics (BLS).

Here’s how it works.

The Fed tries to create jobs through lower interest rates. If consumers and businesses can borrow at cheaper rates, then the thinking goes they will borrow more money. With that extra cash, they’ll spend more on goods, services, equipment, etc., thereby driving up demand for such things. Businesses then will meet increased demand by hiring more people to build, sell, and maintain all the new stuff.

Only, it hasn’t happened that way.

Some industries, such as autos, benefitted from higher sales based on lower rates. Most did not.

Take housing. It is logical that with very low interest rates home buyers would rush out to purchase homes, thereby driving up new home construction. But the pace of home sales since 2008, particularly new home sales, has been anemic at best.