This article includes the US Central Banks‘ history and the road to nowadays situation and Federal Reserve System structure. As well as, you can find information about Fed working system and cooperation with other US institutions and finally demystify several myths you heard from people who do not know how Fed work. Find out what Federal Reserve System is? Read, learn, be smart. Regards. (more…)

US Federal Reserve System (shortly FED) impact US economy basically by two interest rates: discount rate (primary credit rate) and fed funds rate. FED directly settles discount rate but fed funds rate it can influence indirectly through operations in the open money market. It works in the following way: commercial banks are obliged to hold a certain part of  the money held by society onto their accounts and if a bank do not have enough liquidity it can borrow some excess of reserves from another bank. This is a fed funds trade. (more…)