by TheBusinessProfessor | Feb 23, 2025 | Economic Analysis & Monetary Policy
What is a Merged Currency? An approach to exchange rate policy is for a nation to choose a common currency shared with one or more nations is also called a merged currency. A merged currency approach eliminates foreign exchange risk altogether. Just as no one worries...
by TheBusinessProfessor | Feb 23, 2025 | Economic Analysis & Monetary Policy
What is the Banking System? Money, loans, and banks are all interconnected. Money is deposited in bank accounts, which is then loaned to businesses, individuals, and other banks. When the interlocking system of money, loans, and banks works well, economic transactions...
by TheBusinessProfessor | Feb 23, 2025 | Economic Analysis & Monetary Policy
How Central Banks Carry Out Monetary Policy? Central Banks carry out monetary policy through setting the overnight interest rate, setting bank capital reserve requirements, and other techniques (such as quantitative easing) to manage the money supply in the...
by TheBusinessProfessor | Feb 23, 2025 | Economic Analysis & Monetary Policy
How is the Federal Reserve Bank Organized? Unlike most central banks, the Federal Reserve is semi-decentralized, mixing government appointees with representation from private-sector banks. At the national level, it is run by a Board of Governors, consisting of seven...
by TheBusinessProfessor | Feb 23, 2025 | Economic Analysis & Monetary Policy
What is Bank Supervision? Several government agencies monitor banks’ balance sheets to make sure they have positive net worth and are not taking too high a level of risk. Within the U.S. Department of the Treasury, the Office of the Comptroller of the Currency...
