What to do with the Fed...................

I figure since I am captive in Dayton Ohio for the next 3.5 weeks(already been here for 1.5) I will get some of the thoughts that have been going through my mind out into the digital arena.

I had a very engaging conversation a few nights ago with a brand new air force lieutenant, who is a closet economist(he won't admit it openly but it's true). He is a big fan of Ron Paul and so we were conversing about some of Paul's views; most of which I agree with on some fundamental level.

The thought came out, that we should do away with the fed, take our proverbial economic lumps and we would be better off in the long run.

First of all, to what end was the fed originally created? Why does it exist today? Has it "out lived" its usefulness?

Secondly, does the fed have a global purpose today? If so, why?

Lastly, if the fed just goes away, what are the short term economic implications? What are some of the potential long term effects?

Take some time to let this sink in and then reply. I am currently researching my own questions to find some of the very real effects of such a decision.

I would appreciate any relevant replies.