EPF 7 Understanding How the Federal Reserve Bank
EPF 7 – Understanding How the Federal Reserve Bank Operates
EPF 7 – Understanding How the Federal Reserve Bank Operates What is the Fed?
EPF 7 – Understanding How the Federal Reserve Bank Operates What is the Fed? The Country’s Bank? The Central Bank? The Banker’s Bank?
EPF 7 - Understanding How the Federal Reserve Bank Operates “Essentially, “The Fed” is the nation’s central bank. The Federal Reserve System’s responsibilities include conducting monetary policy; supervising and regulating financial institutions; and providing services to depository institutions, the federal government, and to the public. . The goal of the Federal Reserve System is to help the economy achieve stable prices, full employment, and economic growth. ”
EPF 7 - Understanding How the Federal Reserve Bank Operates Essentially, “The Fed” is the nation’s central bank. The Federal Reserve System’s responsibilities include conducting monetary policy; supervising and regulating financial institutions; and providing services to depository institutions, the federal government, and to the public. . The goal of the Federal Reserve System is to help the economy achieve stable prices, full employment, and economic growth.
EPF 7 - Understanding How the Federal Reserve Bank Operates Essentially, “The Fed” is the nation’s central bank. The Federal Reserve System’s responsibilities include conducting monetary policy; supervising and regulating financial institutions; and providing services to depository institutions, the federal government, and to the public. . The goal of the Federal Reserve System is to help the economy achieve stable prices, full employment, and economic growth.
EPF 7 - Understanding How the Federal Reserve Bank Operates Essentially, “The Fed” is the nation’s central bank. The Federal Reserve System’s responsibilities include conducting monetary policy; supervising and regulating financial institutions; and providing services to depository institutions, the federal government, and to the public. . The goal of the Federal Reserve System is to help the economy achieve stable prices, full employment, and economic growth.
EPF 7 - Understanding How the Federal Reserve Bank Operates Essentially, “The Fed” is the nation’s central bank. The Federal Reserve System’s responsibilities include conducting monetary policy; supervising and regulating financial institutions; and providing services to depository institutions, the federal government, and to the public. . The goal of the Federal Reserve System is to help the economy achieve stable prices, full employment, and economic growth.
EPF 7 - Understanding How the Federal Reserve Bank Operates • Monetary Policy Use of Interest Rates & Money Supply • Fiscal Policy Use of Tax Rates & Government Spending • Depository Institutions Another Name for Banks, Credit Unions, etc. • Reserve Requirements How Much of the Customer’s Money Banks Must Hold in Reserve What we already know
EPF 7 - Understanding How the Federal Reserve Bank Operates A Brief History https: //www. frbatlanta. org/about/fed-explained/2013/central-bank. aspx
EPF 7 - Understanding How the Federal Reserve Bank Operates Complete the EPF 7 Pretest in Google Classroom
OBJECTIVE: Be able to describe the organization of the Federal Reserve (FED) Banks Simplistically, . . . There are seven members appointed to the Board of Governors by the President and confirmed by the Senate Think of them as the board of directors
OBJECTIVE: Be able to describe the organization of the Federal Reserve (FED) Banks . One step down is the Federal Open Market Committee (FOMC) consisting of the 7 members of the B. of G. and 5 of the 12 Federal Reserve Bank Presidents (on a rotating basis) from around the country. This groups directs Monetary Policy for the FED
OBJECTIVE: Be able to describe the organization of the Federal Reserve (FED) Banks . The Open Market Committee in turn appoints from each of the FED districts the 12 members of the Federal Advisory Council that advises the B. of G.
OBJECTIVE: Be able to describe the organization of the Federal Reserve (FED) Banks . The FED is divided in to 12 separate banks and 25 branches around the country. Each bank, plus 9 additional offices, process all of our checks
OBJECTIVE: Be able to describe the organization of the Federal Reserve (FED) Banks . Approximately 20, 000 nationwide banks & depository institutions are members. Each is regulated & FDIC Insured
OBJECTIVE: Be able to describe the organization of the Federal Reserve (FED) Banks
OBJECTIVE: Be able to describe the organization of the Federal Reserve (FED) Banks FED Bank of Atlanta’s Take: https: //www. youtube. com/watch? v=L 0 h. Qfax. YU 8 k
OBJECTIVE: Be able to describe the organization of the Federal Reserve (FED) Banks AN OVERVIEW (Of How the Fed Operates) https: //www. frbatlanta. org/about/fed-explained/2013/regional-banks. aspx
OBJECTIVE: Be able to describe the role of the Federal Reserve (FED) Banks The Federal Reserve has three primary roles: Monetary Policy: https: //www. federalreserveeducation. org/about-the-fed/structure-andfunctions/monetary-policy Banking Supervision: https: //www. federalreserveeducation. org/about-the-fed/structure-andfunctions/banking-supervision Financial Services: https: //www. federalreserveeducation. org/about-the-fed/structure-andfunctions/financial-services
OBJECTIVE: Be able to describe the role of the Federal Reserve (FED) Banks The Federal Reserve has three primary roles: Monetary Policy: https: //www. federalreserveeducation. org/about-the-fed/structure-andfunctions/monetary-policy Banking Supervision: https: //www. federalreserveeducation. org/about-the-fed/structure-andfunctions/banking-supervision Financial Services: https: //www. federalreserveeducation. org/about-the-fed/structure-andfunctions/financial-services See FED Exercise
OBJECTIVE: Be able to match the terms used in the Federal Reserve Bank discussion with their appropriate definitions • Government Securities • Board of Governors • Discount Rate • Federal Open Market • Soundness Committee • Compliance • Depository Institutions
OBJECTIVE: Be able to match the terms used in the Federal Reserve Bank discussion with their appropriate definitions • Government Securities • Board of Governors • Discount Rate • Federal Open Market • Soundness Committee • Compliance • Depository Institutions DEFINITION: A bond (an instrument of indebtedness) issued by the government with a promise of repayment in the future.
OBJECTIVE: Be able to match the terms used in the Federal Reserve Bank discussion with their appropriate definitions • Government Securities • Board of Governors • Discount Rate • Federal Open Market • Soundness Committee • Compliance • Depository Institutions DEFINITION: The interest rate charged to commercial banks and other depository institutions on loans they receive from their regional Federal Reserve Bank
OBJECTIVE: Be able to match the terms used in the Federal Reserve Bank discussion with their appropriate definitions • Government Securities • Board of Governors • Discount Rate • Federal Open Market • Soundness Committee • Compliance • Depository Institutions DEFINITION: What is said to describe a financial or depository institution (bank) as financially strong, secure, or reliable
OBJECTIVE: Be able to match the terms used in the Federal Reserve Bank discussion with their appropriate definitions • Government Securities • Board of Governors • Discount Rate • Federal Open Market • Soundness Committee • Compliance • Depository Institutions DEFINITION: The action or fact of complying with a wish or command.
OBJECTIVE: Be able to match the terms used in the Federal Reserve Bank discussion with their appropriate definitions • Government Securities • Board of Governors • Discount Rate • Federal Open Market • Soundness Committee • Compliance • Depository Institutions DEFINITION: The main governing body of the FED. It is charged with overseeing the FED and with helping implement monetary policy.
OBJECTIVE: Be able to match the terms used in the Federal Reserve Bank discussion with their appropriate definitions • Government Securities • Board of Governors • Discount Rate • Federal Open Market • Soundness Committee • Compliance • Depository Institutions DEFINITION: The branch of the Federal Reserve Board that determines the direction of monetary policy.
OBJECTIVE: Be able to match the terms used in the Federal Reserve Bank discussion with their appropriate definitions • Government Securities • Board of Governors • Discount Rate • Federal Open Market • Soundness Committee • Compliance • Depository Institutions DEFINITION: Another name for a bank, credit union, or similar commercial operation that holds consumer savings.
OBJECTIVE: Be able to describe Monetary Policy actions and their potential impact on the economy. MONETARY POLICY - The process by which a country controls the supply of money or interest rate to ensure price stability and general trust in the currency
OBJECTIVE: Be able to describe Monetary Policy actions and their potential impact on the economy. MONETARY POLICY ACTIONS - Change the Discount Rate - Buy/Sell Government Securities - Change the Reserve Ratio
OBJECTIVE: Be able to describe Monetary Policy actions and their potential impact on the economy. MONETARY POLICY ACTIONS - Change the Discount Rate - Buy/Sell Government Securities - Change the Reserve Ratio EXERCISE: For each of the actions listed, identify the action needed to EXPAND the economy when it appears the country is sliding into a recession or CONTRACT the economy when inflation is growing.
OBJECTIVE: Be able to describe Monetary Policy actions and their potential impact on the economy. See Handout “What to Do!? ” If the economy is sliding into a recession, the FED had better. . . _____ the discount rate _____ the amount of government securities purchased _____ the reserve ratio EXERCISE: For each of the actions listed, identify the action needed to EXPAND the economy when it appears the country is sliding into a recession or CONTRACT the economy when inflation is growing.
OBJECTIVE: Be able to describe Monetary Policy actions and their potential impact on the economy. See Handout “What to Do!? ” Likewise, if the inflation rate is rising higher than we would like to see, the FED had better. . . _____ the discount rate _____ the amount of government securities purchased _____ the reserve ratio EXERCISE: For each of the actions listed, identify the action needed to EXPAND the economy when it appears the country is sliding into a recession or CONTRACT the economy when inflation is growing.
OBJECTIVE: Be able to describe the services provided by the Federal Reserve Bank to its members. FED MEMBER SERVICES: - Supply currency & coin to banks - Process checks and e-payments - Protect consumers through regulation & education - Offer consumer insurance (FDIC)
OBJECTIVE: Be able to describe the services provided by the Federal Reserve Bank to its members. FED MEMBER SERVICES: - Protect consumers through regulation & education - Offer consumer insurance (FDIC) Why?
OBJECTIVE: Be able to describe the services provided by the Federal Reserve Bank to its members. FED MEMBER SERVICES: - Protect consumers through regulation & education - Offer consumer insurance (FDIC) Why? To maintain confidence in the United States Banking system.
OBJECTIVE: Be able to describe impact on the national debt of Monetary Fiscal Policy. National Debt: The amount a country owes lenders from borrowing Budget Deficit: When a country’s spending is more than their revenue Balanced Budget: When a country’s spending is equal to their revenue Budget Surplus:
OBJECTIVE: Be able to describe impact on the national debt of Monetary Fiscal Policy. National Debt: The amount a country owes lenders from borrowing Budget Deficit: When a country’s spending is more than their revenue Balanced Budget: When a country’s spending is equal to their revenue Budget Surplus: (Never heard of such a thing)
OBJECTIVE: Be able to describe impact on the national debt of Monetary Fiscal Policy. National Debt: The amount a country owes lenders from borrowing Budget Deficit: When a country’s spending is more than their revenue Balanced Budget: When a country’s spending is equal to their revenue Budget Surplus: (Never heard of such a thing) Let’s see what Crash course Economics has to say about the National Debt https: //www. youtube. com/watch? v=3 s. UCSGVYz. I 0
EPF 7 - Understanding How the Federal Reserve Bank Operates COMPLETE THE EPF 7 QUIZLET
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