The price of money will go down, that's what the federal funds rate is, it's the target rate, so I'll say Fed Funds Rate, it's the target rate that the Fed sets for the overnight borrowing of reserves between banks, that's the Federal Funds Rate, and it will go down and that's how the Fed tries to set the Federal Funds Rate.

The Federal Reserve cut its benchmark discount rate to an 18 year low.

During normal times in the economy, the Fed tries to control the amount of economic activity that's occuring by targeting the federal funds rate the fed funds rate.

Now, fast forward to a situation like we are right now and the Federal Funds Rate is already at zero.

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But what happens if you keep doing this, and you keep lowering the federal funds rate all the way down so that the overnight borrowing rate is approximately 0 , what do you do then?

The Federal Reserve slashed interest rates.

Please send this by Federal Express.

I work for the federal government.

The federal government abdicated most responsibility.

If we had a 2 rate, for whatever reason, we could lend money to the federal government in the form of buying bonds from them we could lend the federal government two years over any time period at 2 .

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And we saw already in the last video, if the Fed does not like the rate that they're borrowing to each other, and if even announcing the federal funds rate doesn't cause the banks to say,

So it keeps lowering the federal funds rate from 4 down to 3 , down to 2 , maybe going all the way down, eventually to 0 .

That's how federal agents and prosecutors think.

We're really dealing with the federal government.

These are loans to the federal government.

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But seeing that this isn't the lowest interest rate that you've ever seen I think the federal funds rate is at something like 2.5 or 3 , so clearly my 100 is what would make any loan shark proud.

Federal Funds Rate, and that's the rate that banks lend to each other overnight and the way that you lower it, if the banks don't do it on their own after you say you want to lower it is that you print money, as the Federal Reserve and you use it to buy, usually short term treasury securities and that money gets deposited in banks, so the demand for reserves, because that's what these things are the demand for reserves goes down, and the supply goes up and the federal funds rate should go down.

The basic version was to have a basic wiki.