We have finally arrived where most discussions about the banking system begin. A lot of economic theory places the cart (The Fed) before the horse (You). In this section we will discuss: (Remember to continue clicking forward.)

The Functions & Macroeconomic Objectives

The Functions & Macroeconomic Objectives of the Federal Reserve System.

Currency & Reserves

A word about the relationship between currency and reserves.

Federal Funds Market

A brief description of the Federal Funds Market.

Influencing Reserves

How the Federal Reserve influences the quantity of bank reserves.

Influencing Interest Rates

What role the Fed has in influencing market interest rates.

Recent Actions

Some examples of recent actions by the Federal Reserve.