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That’s not how the Fed interest rate works. Yo can’t just “deposit” your money with the Fed and have it pay you interest. What you can do is buy bonds. These bo
by elwebmaster 3y ago
That’s not how the Fed interest rate works. Yo can’t just “deposit” your money with the Fed and have it pay you interest. What you can do is buy bonds. These bonds have a price and maturity date. When the interest rates keep increasing the bonds which pay less interest become cheaper. So you can’t just “withdraw” what you deposited. You have to sell what you “bought” but for much less than you paid, so you go under.
- bombcar 3y agoYou can't. Banks can. https://www.newyorkfed.org/markets/reference-rates/obfr https://www.newyorkfed.org/markets/reference-rates/obfr and things like that.
- JumpCrisscross 3y agoThe OBFR is the rate banks pay to borrow reserves from each other. You’re thinking of interest on reserves (IORB) [1], which is interest the Fed pays to interfere in that market. [1] https://www.federalreserve.gov/monetarypolicy/reserve-balances.htm https://www.federalreserve.gov/monetarypolicy/reserve-balanc...