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Unformatted text preview: resort. The discount rate is the rate they charge banks when they need money. Federal funds are reserves. Relations ship between the federal funs rate and the discount rate. Prime rate- what the banks were giving to the most trustworthy of customers. Individual banks set the prime rate. Bank panics- Cyclical asymmetry- even when money is put in the system there is no guarantee there gonna use it. The federal reserve has many ways they control the free market Artful management- Alan Greenspan Inflation targeting...
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This note was uploaded on 04/12/2008 for the course ECO 1000C taught by Professor Lawrence during the Spring '08 term at St. Johns Duplicate.
- Spring '08
- Monetary Policy