Fiscal and monetary policy in parallel | AP Macroeconomics | Khan Academy
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Fiscal and monetary policy in parallel.
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AP Macroeconomics on Khan Academy: Welcome to Economics! In this lesson we'll define Economic and introduce some of the fundamental tools and perspectives economists use to understand the world around us!
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Monetary supply controls the cost to obtain credit or the cost of banking. One tool is to alter the form of the dollar. So called, open market operations, changes the form of government liabilities but not the quantity, with the exception of raising interest rates, which is fiscally expansionary. Monetary policy influences the quantity of monetized bank credit.
Fiscal policy is the creation of reserves via spending. Spending injects reserves into the private sector. On the opposite side of the coin, taxes remove reserves from the private sector. Fiscal policy is the creation and destruction of the currency. Monetary policy is the cost to obtain credit.
End the FDR
What for when we have two planes that can just vanish into thin air. End the FDR
Roosevelt has been dead for a long time. But he was a great man.
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