This is Part 5 of a multipart series on Wall Street. Part 1 dealt with Republican economic philosophy over the last 30 years which has produced disastrous results for the American economy leading up to the 2008 crisis. Parts 2, 3 and 4 dealt with whether or not Wall Street banks should have been allowed to fail. Part 5 deals with the incestuous relationship between the Federal Reserve Bank and Wall Street.
By John Lawrence
The US Federal Reserve Bank is the central bank of the US. It's mission is to control the nation's monetary policy i.e. the amount of money circulating in the economy, and to maximize employment. It does this by raising or lowering interest rates. When interest rates are low, there is more money in circulation and it's cheaper to borrow. Low mortgage rates encourage home sales and they also encourage the sale of large consumer items such as cars.
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