Introduction to how banks make money and the value they (potentially) add to society.
Course
Banking and Money
Videos on how banks work and how money is created.
25 Lectures
-
-
Introduction to the income statement of a bank (and to income statements in general).
-
Fractional reserve banking and the multiplier effect. Introduction to the money supply.
-
How "money" is created in a fractional reserve banking system. M0 and M1 definitions of the money suppy. The multiplier effect.
-
Introduction to bank notes (which you are more familiar with than you realize).
-
More on how bank notes and checks can be used.
-
How banks can give out loans without ever giving out gold.
-
How reserve requirements limit how much lending a bank can do.
-
Seeing how reserve ratios limit how much lending I can do.
-
What leverage is. Why it is is good or bad. Leverage and insolvency.
-
Introduction to the idea of a reserve bank.
-
Introduction to government debt and treasuries. What it means when we say that Federal Reserve Notes are issued by the Reserve bank but are an obligation of the Government.
-
Tools of the Central Bank to increase the money supply.
-
How open market operations effect the rate at which banks lend to each other overnight.
-
More on the mechanics of the Federal Funds rate and how it increases the money supply.
-
The rationale for targeting interest rates instead of directly having a money supply target.
-
Getting off the gold standard. A short discussion of the meaning of wealth.
-
Pros and Cons of various banking systems. More on gold.
-
The discount rate and window. Lender of last resort.
-
Mechanics of repurchase agreements (repo transactions/loans).
-
Analysis of the federal reserve balance sheet as of Feb 2007.
-
Understanding the weak points of Fractional Reserve Banking.
-
More on the weaknesses of fractional reserve banking. The FDIC and deposit insurance and its side effects.
-
Summary of thoughts in last two videos. Discussion of why Fractional Reserve Banking is a subsidy to banks and allows them to arbitrage the yield curve.
-
London InterBank Offer Rate