Unformatted text preview: A -l.L_...-_;.M.._.A-.M .4. . Fed Funds Target vs. Fed Funds Rate - The FEDsetsﬂ'IeIzrgEtraizﬂ-natitwamsmachieve and then uses its tools to inﬂuence the supply and
demand of reserve balances Tools
1) Open market ovations
2) Policytowards required reserves
3) Contractual clearing balances .
4) Lending through the discount window Rates = 0 ? - The FED has wt ratesto hlsmriml Iowsto stlrnulatethe economy. Curtenturget me range is D '—X percent. ' Aug 10“ FOMC notes
Wm '1'» Committee minimum themrpetmnpefw lhej-domlﬁmd: nan
aimehdnullum mien" mndedperM‘ Open Market Operations The FED will go out in the actual marketand buy and sell
securities. This could be anything, but is typially
treasurlu Make up has changed from almost all treasurles to
metal other assets. Unprecedented moves by (he FED. they are so m
economy 9/1/2010 ...
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- Fall '10