Issues Americans Cannot Understand: The Federal Reserve and the Economy

In the past three years, the United States experienced an amazing change from the highest point of history to the lowest position since the Great Depression. Many Americans do not know how they will affect their daily lives. Most people do not understand the complexity of the US banking system, but how does the Federal Reserve Board manage rates, monetary operations, inflation, credits, etc.? Low educational level is a problem facing some aspects of our lives.

• The Federal Reserve System. The Federal Reserve System ("FRB") manages the money supply and credit lines of the US economy. It affects not only the American economy but also the world economy. In the book and the summary of all 12 pages, you will learn how economic mechanisms such as interest rates and monetary policy work and how the government stimulates the economy using fiscal and monetary policies. • Currency and exchange rate. Changing the exchange rate makes foreign goods cheaper or more expensive. Because underestimated currencies promote exports, rising currency increases purchasing power, so the strength or weakness of the currency is not inherently good or bad. This book explains various ways to evaluate money mutually, such as gold standard, floating exchange rate, fixed exchange rate, correlation between currency and other currencies.

The reserve currency (or major currency) is a currency that is largely held by the government and institutions as part of foreign currency reserves. The reserve currency is often used for all aspects of international trading, international investment, and the world economy. It is usually considered a coin or safe heaven's currency. People living in the country issuing the reserve currency can purchase imported goods and cross border loans at a lower price than people in other countries because there is no need to exchange currencies.

In the last century, the dollar gave up fixing gold, and now you are the largest credit resource manufacturer in the world economy. Shortly thereafter, most of the credit resources are managed by the central government and may be managed by the Federal Reserve or the Central Bank of China. Some central agencies may be able to create credit resources for the global market but there are also many problems. For example, in China, the majority of credits come from the central government, whose benefits are managed by companies or organizations closely related to the government.