In celebration of Financial Literacy Month, the article addresses two key questions regarding economic concepts. First, it explains that the President cannot simply fire the Federal Reserve Chair due to the institution's significant independence established by Congress in 1913. This independence is critical in mitigating political pressure on monetary policy. Secondly, the article elucidates how bonds function, detailing the loan dynamic whereby buyers provide funds in exchange for fixed interest, with pricing influenced by the borrower's perceived risk and market fluctuations.
According to a 1935 Supreme Court ruling, Fed officials can only be forced out or fired for cause, which most have interpreted as some sort of crime, like embezzlement.
Buying a bond is essentially the process of making a loan to an entity, whether that's a government, a state, a municipality, or a company.
If you want to sell a bond before it matures, you may find that the price has changed due to fluctuations in interest rates.
Powell has been steadfast in his assertion that presidents may not legally fire or demote the Fed chair and he would not step down, if asked to do so.
Collection
[
|
...
]