Federal Reserve
America's central bank
The Federal Reserve is the central banking system of the United States, responsible for monetary policy, regulating banks, and maintaining financial stability.
Often called the Fed, it sets interest rates that influence borrowing costs throughout the economy.
When the Fed raises rates or cuts rates, markets react.
The system comprises twelve regional banks and a board of governors in Washington.
Central bank economic controls
- lender of last resortEmergency credit source for banks
- bank regulationRules governing financial institutions
- Board of GovernorsLeadership committee of institution
- FOMCFed's policy-setting body
regional banks · payment systems · systemic risk · credit control · economic research · stress tests · capital requirements · too big to fail
Interest on Fed loans
- rate cutLowered borrowing cost
- prime rateBank's benchmark lending percentage
- yield curveRates plotted against maturities
- dot plotChart of individual data points
Asset purchases to boost economy
- balance sheetAssets-liabilities-equity report
- bailoutEmergency aid preventing bankruptcy
- taperNarrow gradually toward point
- unwindingReleasing coiled tension
Consistent general price levels
- consumer pricesCosts paid by buyers
- CPIInflation measurement abbreviation
- cost of livingPrice of basic necessities
- purchasing powerEconomic spending ability
core inflation · disinflation · deflation · stagflation · inflation hawks
monetary policy
Central bank economic controls
- lender of last resortEmergency credit source for banks
- bank regulationRules governing financial institutions
- Board of GovernorsLeadership committee of institution
FOMC · regional banks · payment systems · systemic risk · credit control · economic research · stress tests · capital requirements · too big to fail · banking oversight
discount rate
Interest on Fed loans
- rate cutLowered borrowing cost
- prime rateBank's benchmark lending percentage
- yield curveRates plotted against maturities
quantitative easing
Asset purchases to boost economy
- balance sheetAssets-liabilities-equity report
- bailoutEmergency aid preventing bankruptcy
- taperNarrow gradually toward point
price stability
Consistent general price levels
- consumer pricesCosts paid by buyers
- CPIInflation measurement abbreviation
- cost of livingPrice of basic necessities
purchasing power · core inflation · disinflation · deflation · stagflation · inflation hawks
- Central BanksFed, European Central Bank, Bank of England, Bank of Japan, Bank of Canada
- economic policymonetary policy, tax policy, fiscal discipline, fiscal stimulus, fiscal restraint
- Economic Bodieseconomic council, finance ministry, treasury department, central bank, budget office
- Economic OrganizationsIMF, World Bank, OECD, WTO, central bank
- financial institutionsbanks, central bank, commercial banks, investment bank, investment banks
- regulatorsthermostat, voltage regulator, regulatory agency, pressure regulator, oversight body
Federal Reservecommercial bank
Deposit and loan institution
private bank · retail bank · investment bank · JPMorgan Chase · Goldman Sachs
Federal Reservegold standard
Measure of ultimate quality
Bitcoin · cryptocurrency · hard money · laissez-faire economics · Austrian economics
reserve, reserved, federal, reserves, federation, reserving, confederate, confederation, confederacy