Lesson 14 portfolio part 2 by Kyra Lynn https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena The Federal Reserve System diagram en-us 2021-11-16 17:57:21 UTC 2021-11-16 19:27:59 UTC hello@padlet.com The Federal Reserve System kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894905566 this is the national central bank(created in 1913). its made up of a board of governors, a dozen reserve banks, and bank members. ]]> 2021-11-16 18:34:50 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894905566 The Importance kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894929790 2021-11-16 18:45:13 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894929790 1. kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894931073 The Fed’s primary role is to supply us with the “right” amount of money so that we avoid both recession and inflation.]]> 2021-11-16 18:45:43 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894931073 2. kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894931688 Its three major functions are regulating the U.S. money supply, supplying currency, and clearing checks.]]> 2021-11-16 18:46:01 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894931688 3. kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894932378 The Fed oversees member banks and exercises regulatory power over all deposit institutions, regardless of whether they are members of the system.]]> 2021-11-16 18:46:21 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894932378 The Structure kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894937955 2021-11-16 18:48:54 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894937955 Board of Governors kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894944437 there are seven members of this board that is appointed by the president. The overall policy of the Fed is established by them. they play a large role in controlling the money supply.]]> 2021-11-16 18:51:41 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894944437 Reserve Banks (12) kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894947437 The Federal Reserve System consists of 12 administrative areas and 12 banks. There are twelve Federal Reserve banks in the country, and each is responsible for holding reserve deposits from its member banks, as well as setting the discount rate for commercial banks in that region.]]> 2021-11-16 18:53:01 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894947437 Banks Member kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894949098 Nationally chartered commercial banks and some state-chartered banks are members of the Federal Reserve System.]]> 2021-11-16 18:53:43 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894949098 The Functions kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894952982 2021-11-16 18:55:25 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894952982 The Governments bank kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894958801 The Fed supplies the nation’s currency and lends money to the government to finance the national deficit.]]> 2021-11-16 18:58:01 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894958801 The Banker's bank kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894959689 Individual banks can borrow from the Federal Reserve and pay interest on the loans.]]> 2021-11-16 18:58:23 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894959689 Check Clearing kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894963377 Not all checks are sent to the Fed for clearance, but financial institutions can use the Fed’s check-clearing service to clear checks drawn on banks outside their Federal Reserve District.
there are six steps involved in the process of clearing a check...]]> 2021-11-16 18:59:59 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894963377 Float kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894964212 the total amount of checks written but not yet cleared through the Federal Reserve.]]> 2021-11-16 19:00:21 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894964212 Controlling the Money Supply kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894966624 The Fed’s main job is to establish and implement monetary policy.
It aims to make certain that enough money and credit are available to allow the economy to expand, thus giving the country an ever-increasing supply of goods, services, and jobs. At the same time, it tries not to release too much money and credit into the economy because a surplus has historically produced inflation.]]> 2021-11-16 19:01:24 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894966624 Inflation Management kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894967706 Because commercial banks are the main creators of money, much of the Fed’s management of the money supply takes the form of regulating the supply of money through commercial banks to control inflation.]]> 2021-11-16 19:01:53 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894967706 The Tools kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894983388 2021-11-16 19:08:46 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894983388 step 1. kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894988838 you live and bank in New Orleans, and you send a $50 check to the Detroit Studio, which deposits it in its Detroit bank.]]> 2021-11-16 19:11:21 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894988838 step 2. kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894990367 The Detroit bank deposits the check in its own account at the Federal Reserve Bank of Chicago.]]> 2021-11-16 19:12:09 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894990367 step 3. kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894992212 The check is sent from Chicago to the Atlanta Federal Reserve Bank for collection, because you, the check writer, live in the Atlanta district.]]> 2021-11-16 19:13:05 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894992212 step 4. kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894993472 Your New Orleans bank receives the check from Atlanta and deducts the $50 from your personal account.]]> 2021-11-16 19:13:43 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894993472 step 5. kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894995881 Your bank then has $50 deducted from its deposit account at the Atlanta Federal Reserve.]]> 2021-11-16 19:14:51 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894995881 step 6. kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894997408 The $50 is shifted from Atlanta to the Chicago Federal Reserve Bank. The studio's Detroit bank gets credited, whereupon the studio’s account is credited $50. Your bank mails the canceled check back to you.]]> 2021-11-16 19:15:35 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1894997408 Changing the reserve requirement kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1895000581 Increasing the reserve requirement leads to less spending in the economy (because banks have less money to lend.) Reducing the reserve requirements increases spending and stimulates business (because banks have more money to lend).]]> 2021-11-16 19:17:05 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1895000581 Changing the discount rate kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1895002505 If the Fed wants to encourage loans, it decreases the discount rate; if it wants to discourage loans, it increases the discount rate.]]> 2021-11-16 19:18:00 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1895002505 Open-market operations kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1895004779 most frequently used to carry out monetary policy. The Fed buys and sells government bonds on the open market.]]> 2021-11-16 19:19:02 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1895004779 Establishing selective credit controls kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1895006840 The Fed uses selective credit controls to set credit terms for various kinds of loans. An example of this is the margin requirement]]> 2021-11-16 19:20:01 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1895006840 In Depth Details kyralynnlly https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1895008683 -If the Fed is concerned about inflation and wants to reduce the amount of money available, it sells government bonds to the public and to banks. The money paid immediately goes out of circulation.
-Conversely, if the Fed wants to get the economy moving again, it buys back its bonds, thus putting additional cash back into the economy.
]]> 2021-11-16 19:20:56 UTC https://padlet.com/kyralynnlly/l2hx0lh30zsf0ena/wish/1895008683