Quantitative easing | Money, banking and central banks | Finance & Capital Markets | Khan Academy
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Overview of quantitative easing. Created by Sal Khan. Watch the next lesson: https://www.khanacademy.org/economics-finance-domain/core-finance/money-and-banking/federal-reserve/v/more-on-quantitative-easing-and-credit-easing?utm_source=YT&utm_medium=Desc&utm_campaign=financeandcapitalmarkets Missed the previous lesson? Watch here: https://www.khanacademy.org/economics-finance-domain/core-finance/money-and-banking/federal-reserve/v/fed-open-market-operations?utm_source=YT&utm_medium=Desc&utm_campaign=financeandcapitalmarkets Finance and capital markets on Khan Academy: You know that the Federal Reserve (or central banks in general) controls the money supply and short-term interest rates. But how exactly do they do this. Even more, how is "quantitative easing" different than regular open market operations. This tutorial explains it all in the context of the Federal Reserves attempts to stave off deflation during the 2008-2012 recession. About Khan Academy: Khan Academy offers practice exercises, instructional videos, and a personalized learning dashboard that empower learners to study at their own pace in and outside of the classroom. We tackle math, science, computer programming, history, art history, economics, and more. Our math missions guide learners from kindergarten to calculus using state-of-the-art, adaptive technology that identifies strengths and learning gaps. We've also partnered with institutions like NASA, The Museum of Modern Art, The California Academy of Sciences, and MIT to offer specialized content. For free. For everyone. Forever. #YouCanLearnAnything Subscribe to Khan Academy’s Finance and Capital Markets channel: https://www.youtube.com/channel/UCQ1Rt02HirUvBK2D2-ZO_2g?sub_confirmation=1 Subscribe to Khan Academy: https://www.youtube.com/subscription_center?add_user=khanacademy
Comments
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sounds like the problem is?????? the fed and the open market..
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Great job! Keep it up.
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What if people who own treasuries don't want to sell them? Also, how do you know those people are going to deposit the cash they receive from selling treasuries in the bank? What if they spend it or invest it somewhere else?
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Sal! I think you should make a video titled 'money creation'. Make it really explicit
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Good explanation
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I have two really good videos and article, you will understand it!
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Not a bad explanation, but I still don't get it, and I've scoured youtube for an explanation I can understand. So much repetition, but all explanations seem to either move too fast, or slough over the ambiguous steps, or use catch phrases that fly over my head.
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Audit the FED
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buy silver.
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@CollectiveCheckup I do: it doesn't.
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Do you give a lesson on how the FED steals from us?
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And, as a side note, it should be added that the real interest rate - as measured by TIPS - only began to seriously spike after the interest on reserves policy was announced, and that the stock market only began to severely crash when the interest on reserves policy was announced, in early October 2008 (not in mid-September 2008 when Lehmans collapsed as most commentators have presumed).
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However, if the Fed pays interest on reserves, as it began to do in early October 2008, the money that it injects through quantitative easing will be neutralized, as banks hold on to excess reserves.
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thanks for this clear explanation
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thanks for the video Sal now i know what the Federal Reseve does with QE
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