Anonymous
Anonymous asked in Business & FinanceTaxesUnited States · 1 decade ago

Whose money is the FED spending?

Can you hear me now!!!!!!!!!!1

Update:

The banks are the ones running the country or are they ruining it !!!!!!!!!!!!!

4 Answers

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  • 1 decade ago
    Favorite Answer

    The Fed isn't spending any money (yet). The Fed allows commercial banks to borrow money (directly from the discount window, when they're in trouble). Now, for the first time, the Fed is allowing investment banks to borrow money the same way commerical banks do. (Whether or not that's a good idea, only time will tell.)

    Because of the credit crunch and the lack of confidence in the markets right now, the Fed acted to help ease those problems.

    This has the potential of being costly though, if it doesn’t succeed. After all, the collateral for this borrowing are those $30 billion dollars mortgage-backed securities, which don't look very good right now.

  • Olivia
    Lv 4
    1 decade ago

    They are spending just your money Dan. :)

  • 2shay
    Lv 5
    1 decade ago

    our money and they print more thats why the $$ isn't worth much.

  • Pam H
    Lv 6
    1 decade ago

    Yours and mine.

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