All depository institutions "commercial banks, saving banks, savings and loan associations, and credit unions "must retain a percentage of certain types of deposits to be held as reserves. ... At the end of 1993, 4,148 member banks, 6,042 nonmember banks, 495 branches and agencies of foreign banks, 61 Edge Act and agreement corporations, and 3,238 thrift institutions were subject to reserve requirements. ... Depository institutions hold required re-serves in one of two forms: vault cash (cash on hand at the bank) or, more important for monetary policy, required reserve balances in ac...

• Word Count: 4049
• Approx Pages: 16
• Grade Level: Undergraduate

Financial markets are needed to control the money supply, with a reasonably tight fiscal policy and credit policy, this lead China to create a bond market, offering bonds with attractive interest rates to soak up excess money that threatened to fuel inflation. ... Also trade unions were not given any corresponding freedom to act and that has also clearly contributed to this problem. ... China's state owned enterprises have been extremely inefficient and to continue operation, they need to be kept afloat by direct government subsidies and loans from the central bank. ... Also, these sta...

• Word Count: 2010
• Approx Pages: 8
• Grade Level: Undergraduate