They had an informal dual mandate to maximize employment and minimize inflation before then, but the purpose of the Federal Reserve as created was to preserve f

They had an informal dual mandate to maximize employment and minimize inflation before then, but the purpose of the Federal Reserve as created was to preserve financial stability, avoid financial panics, and maximize employment. In other words, they had half of the dual mandate, the half that involved injecting money when times were bad to stabilize the system. The government codified the inflation mandate in response to the 1970s inflation. The phenomena of dropping rates when a recession is impending is congruent with the "maximize employment" portion of their mandate, which predated 1977. Indeed, their failure to do this in 1929-1930 led to the Great Depression. Ben Bernanke's pre-Fed-chair academic career was devoted to studying that.