Questions tagged [central-bank]
27 questions
55
votes
2 answers
Why do banks “park” their money at the European Central Bank?
I regularly read that the European Central Bank charges a negative interest rate on money that banks park there. But why would a bank put their money to the Central Bank then? Can't they just keep it in their own bank and not have to pay that…
Martin Ueding
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7
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How do reserve banks influence home-loan interest rates?
On the First Tuesday of every month the board of the RBA (Reserve Bank of Australia) meets and sets the target for the cash rate.
I understand that they are trying to adjust the amount of money people have to spend by changing the amount of…
David Kethel
5
votes
2 answers
In layman's terms, what happens to the average Joe, in a "bank bail-in"?
I've come across some scare stories that a "bail-in", being the opposite of a bail-out, is where a bank uses deposits to restructure their capital, and that the average Joe with savings above a certain threshold has their money taken from their…
Stewart
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4
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2 answers
Do central banks really dispose of old currency the way it's shown in movies?
I have watched many movies where people who want to rob a load of money, Just wait until the federal reserve pulls money back to them and right in between them removing the serial numbers from their records, and burning the bills, they go in and…
Joseph Casey
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3
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1 answer
Why are EU banks hesitant to open an account and take our money?
In Europe, I work for a small/honest internet business. We make a fair profit every month, so we wanted to deposit our profits in different banks, until we decide what to do with the money.
To our surprise, all the banks we contacted were reluctant…
elemolotiv
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3
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3 answers
Interest rates and what does "discount" mean?
I was reading an article that says "Interest rates play an essential role in financial markets. Foremost, they represent the rate at which investors discount risk-free as well as risky future cash flows." and I don't get what "discount risk-free as…
noplace
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3
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Are Fed repo operations done through the discount window?
Recently the Fed performed repo operations to keep the effective Fed funds rate down and close to its target. Is this the usual way banks get loans from the discount window, using treasuries as collateral, or is it something new?
I've read that this…
Jonah
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2
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3 answers
How to measure a currencies valuation or devaluation in relevance to itself
Usually when currencies are devalued, the percentage change is given in relevance to USD or EUR.
Is there a way to measure the currencies change in value to itself or to all the world's currencies combined?
user62060
2
votes
1 answer
What does it mean that People's Bank of China has transitioned "from wealth to currency management"?
A note from a Deutche Bank strategist quoted in this article says that:
...we estimate that the pound’s share has likely fallen from close to
10% into low single digits since early 2015 (chart 2), consistent with
the PBoC transitioning from…
SherlockEinstein
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2
votes
3 answers
Depositing or cashing a $2 Million check
I would like to ask you the question. Will 2 millions dollars check to be cash? and How long will 2 millions dollars check to be cash?
I understand, but the 2 millions dollars check from the headquarter company that was paid to the anonymous worker…
Carolyn
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2
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1 answer
Trying to understand the U.S. yield curve and global inflation
With the COVID crisis the FED has lower interest rates a lot:
Now, inspecting the US yield curve:
It seems to be that this is a normal curve that doesn't flatten too much at the end. Is this correct?
According to this article:
A steep yield curve…
Martel
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2
votes
0 answers
How much value has the US Dollar lost or gained in 2020, compared to the US Dollar in 2019?
There's a lot of news about the Federal Reserve printing money. I have a hard time imagining the relative change in value of the USD. (or EURO for that matter)
I tried to calculate but it's hard:
The money that is easily perceived as money Money…
Frank De Smedt
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2
votes
2 answers
Are the corporate bonds' interest rates set by central banks?
In countries which use a central bank system:
When people speak about the 'interest rates', they mean interest to which the central bank (whatever it is) lends money to other banks, which in turn will lend money to corporates and individuals.…
Martel
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2
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4 answers
European banks, low interest rates and "free money" for home owners?
Where I live in Scandinavia and across Europe, interest rates are very low.
More and more people are using the rising value of their home to draw out money. I would almost call it "free" money when the interest rate is near 2%.
Case in point: I…
vikingsteve
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1
vote
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Savings account with fixed interest or not?
Me and my wife are renting our apartment and we're both students with part time jobs. We are saving up for a condo more suitable to our needs, we would like to have our down payment within five years. It seems a savings account is best since we…
pimmen
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