Before class on Tuesday, 11/09
Read: Lumen Learning “Monetary Policy” and “Monetary Policy and Open Market Operations”
Watch (8:10): Schamus (2014)
Before class on Friday, 11/12
have done or attempted all of Weekly Review 10
Material Links
Lumen Learning. (2021). Module 13: “Monetary Policy” https://courses.lumenlearning.com/wm-macroeconomics/chapter/tools-of-monetary-policy/ and “Monetary Policy and Open Market Operations“ https://courses.lumenlearning.com/wm-macroeconomics/chapter/monetary-policy-and-open-market-operations/
Schamus, James. (2014). “The Second Part of That Film About Money.” wetheeconomy.
Reading Summary
One piece of Information that I learned was that open market operations are a more precise and powerful means of executing any desired monetary policy.
Questions I came up with were:
Why did depositors become convinced that the bank would be able to honor their withdrawals?
What is the percentage of each bank s deposits that it is legally required to hold as cash in their vault or on deposit with the Fed?
The Author talks about:
How banks borrow money from the fed at a discount rate and then loan to people at a certain interest rate this makes it easier for them to manage the interest rate between the feds and banks, but for us as individuals we would need to find the best deal, that would benefit us. I agree that many banks come with many different interest rates when borrowing money this all depends on how much reserves these banks have to lure us into borrowing.
The author would take the side of having the monetary policy set in place, since this does help run the economy and help keep people employed to those businesses.
I can relate on the matter only because my mom had to borrow money when I was a kid for my travels and the banks gave her such an small interest rate but yet she ended up paying almost double that amount making me wonder just how high the interest of some federal banks are.
I have learned that the monetary policy is a vital to keep an economy from going into a recession.
My Least favorite part was that in the video, how she explain that productivity is high and that the workers are getting very little money. (masters of the universe)
My favorite part is, that we as people are actually the creditors and that we are the once lending money to the bank. But most people are already in so much debt they cannot see that.