|
|
REPURCHASE AGREEMENT: A common type of bank account in which funds are transferred from one account to another, then automatically transferred back after a short period, usually overnight. In effect, a bank customer buys a legal claim from a bank with the understanding that the bank will automatically "repurchase" this legal claim back after a specified time period. Repurchase agreements were original developed as a round about means of paying interest on business checking, which such interest paying was legally prohibited. Repurchase agreements are near monies added to M1 to obtain broader monetary aggregates, M2 and M3.
Visit the GLOSS*arama
|
|
|
|
|
Lesson 20: Federal Reserve System | Unit 4: Monetary Policy
|
Page: 14 of 20
|
|
Topic:
Open Market Operations
|
|
|
Open market operations are the most important tool of monetary policy.- The Federal government budget deficit is financed by issuing or selling U.S. Treasury Securities, which are traded through the open market.
- Banks, corporations, government agencies, pension funds and regular people are the buyers and sellers in this 'open market' for Treasury Securities.
- Treasury Securities are low risk investments.
Two major players in the open market: - Commercial Banks: They use secure investments to ensure bank stability.
- Federal Reserve: They buy and sell treasury securities with the expressed goal of manipulating bank reserves and the money supply.
|
|
|
|
|
|
|
AGGREGATE EXPENDITURES EQUATION An equation that summarizes the four aggregate expenditures on gross domestic product by the four macroeconomic sectors. In the study of Keynesian economics, this equation is commonly used to summarize the demand side of the macroeconomy. The aggregate expenditures equation actually comes in three different versions depending on how many of the four sectors and their expenditures are included.
Complete Entry | Visit the WEB*pedia |
|
|
|
Cyrus McCormick not only invented the reaper for harvesting grain, he also invented the installment payment for selling his reaper.
|
|
|
"Courage is the ladder on which all the other virtues mount." -- Claire Boothe Luce, diplomat, writer
|
|
CIFE
Cost, Insurance, Freight and Exchange
|
|
|
Tell us what you think about AmosWEB. Like what you see? Have suggestions for improvements? Let us know. Click the User Feedback link.
User Feedback
|
|
