Lesson 1
1 Introduction
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Central Banks, originally created as bankers' banks, implement monetary policy using their leverage over the supply of money and credit standards. Central banks monitor currency flows and inflation, acting when crises, such as bank runs, emerged. More recently, central banks have taken an increasingly expansive role in stabilizing economic fluctuations. In the yet to be confirmed current recession, the Federal Reserve has used open market operations and innovative financial arrangements to try to forestall the recession and bail out failing financial institutions. Shiller, Robert J. ECON 252, Financial Markets (2008), Spring 2008. Yale OpenCourseWare: Economics, Accessed 23/9/14 http://oyc.yale.edu/economics/econ-252-08/lecture-16 License: Creative Commons BY-NC-SA

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