It is widely known that economic activity does not evolve smoothly over the course of a year, but that it varies systematically across the different seasons. This is not surprising: Weather is an important factor in many sectors of production. While agriculture is an obvious example, construction is another important activity affected by weather: No doubt, it is much harder to build a house in Chicago during the winter months than during the rest of the year. Institutional arrangements also lead to seasonal fluctuations in economic activity. For instance, a disproportionate fraction of American families take vacations during the summer months partly because they coincide with school recess. Another example is Christmas, which sharply increases retail activity during the last month of the year. While most modern discussion about monetary policy centers on what is the best policy to follow over booms and recessions, very little is said about what is the best policy to follow across different seasons. However, this has not always been the case. The evolution of U.S. monetary institutions and, in particular, the creation of the Federal Reserve System have been partly guided by this discussion.