The Federal Reserve under the Depository Institutions Deregulation and Monetary Control Act of 1980 sets the reserve requirements. ... Supply of Reserves The Federal Reserve supplies reserves to the banking system in two ways: Lending through the Federal Reserve discount window Buying government securities (open market operations). ... When the Federal Reserve buys securities in the open market, it creates reserves to pay for them, and the supply of non-borrowed reserves increases. ... In other words, the Federal Reserve adjusts the supply of non-borrowed reserves by purchasing or selling se...

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

The Federal Reserve Bank, established in 1913, has the duty of regulating money and credit. It issues Federal Reserve Notes, clears checks, acts as a fiscal agent to the federal government, and audits and maintains competition in the banking system. ... During this period the Federal Reserve spent $100 billion every month buying mortgage-backed securities, by the end of the program the Federal Reserve had spent $1.7 trillion dollars on these securities. ... In this round, the Federal Reserve decided to spend $85 billion on U.S. ... Federal Reserve. ...

• Word Count: 3183
• Approx Pages: 13
• Has Bibliography
• Grade Level: Undergraduate