The Federal Reserve
The institution at the center of American monetary policy -- its design, its tools, and its politics
The Federal Reserve is the most powerful economic institution in the United States, and arguably in the world. Its decisions about interest rates and money supply affect employment, wages, asset prices, and the distribution of income in ways that Congress's fiscal decisions rarely match. Understanding what it does, how it works, and whose interests it tends to serve is essential to understanding the American economy.
Structure and Mandate
What the Federal Reserve is, who controls it, and what it is legally required to do.
Interest Rates as Policy
How raising or lowering the federal funds rate ripples through the entire economy -- and whose interests each direction serves.
QE and Asset Price Inflation
Quantitative easing expanded the money supply dramatically. Most of the new money went into financial assets, not wages.
The Fed and Inequality
Fed policy is not distributional neutral. Low rates benefit asset holders; high rates fall hardest on workers.