This article talks about the issue of the Fed loaning out large amounts of money to help keep banks afloat during these rough economic times. Smaller banks would take out loans as low as $1,000 and then you have banks borrowing 6 million and still going bankrupt shortly after. Small and large banks all over the country were having severe issues in 2007-2008.
I do believe people should know how much and how often their banks borrow money. Yes, it may discourage them from using the bank but they should know what kind of organization they are trusting their money with. If they are dealing with a bank who is barely keeping their head above water, they might approach and handle situations differently. I am looking at it more as a civilian and not an economist though. I know if I am working everyday for my money, I want to put some place I know it is safe.
I do think it is important for the Fed to offer loans to the commercial banks; because without that the smaller banks will not be able to borrow money. Even though I said people should know how much and how often their banks borrow money, but everyone goes through rough spots. Borrowing money shouldn't be seen necessarily as a bad thing, because again it is basically unavoidable. But if your bank has to borrow 6 million and still cannot operate, something is wrong.
Overall I thought it was a good blog, it gave a good definition of how the Fed worked. I think anyone who didn't know anything about the Fed would have a much better understanding of it just by reading this blog. I would have liked to known a little bit more about what they personally thought about the situation.
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