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Mbb6
- 2. Money, Banking, and Business Lecture 6 Central Banks Financial Markets
- 3. Questions?
- 8. FED Duties Monetary Policy Supervision Payments Bank for the U.S. Government
- 9. FED Duties Prints Currency Holds Other Bank Deposits Serves as the Governmentโs Bank Regulates Banks and Payment System Sets Monetary Policy Intervenes in Foreign Currency Markets Lender of Last Resort
- 10. FED Functions Issues Currency Clear checks Bank of Banks
- 12. Federal Open Market Committee FOMC 12 members 7 board governors 5 from 12 regional banks
- 13. Payments Mechanism checks electronic 25 billion $43 trillion
- 14. Tools Open Market Operations Discount Rate Reserve Ratio
- 15. Open Market Operations Buying and Selling Financial Instruments
- 16. Banks now have more cash to loan Central Bank Public Banks Increase Money Supply? Buy bonds for cash
- 17. Banks now have less cash to loan Central Bank Public Banks Decrease Money Supply? Sell bonds for cash
- 18. Discount Rate Rate the FED charges member banks
- 19. Discount Rate Currently 1.75% Average 4.45% (1950 - 2017)
- 20. Pattern?
- 21. Reserve Ratio Fraction of deposits that must be held in reserve
- 22. Central Banks Independent Political Pressure Accountable Who do they answer to?
- 23. Financial Markets, Instruments, and Market Makers Chapter 4
- 24. Six Financial Markets Primary Market Secondary Market Money Market Capital Market Spot Market Futures Market