SCARCE TO ABUNDANT RESERVES
Is the market missing this revolutionary change at the Federal Reserve? And should we rethink the yield curve as a forecasting tool?
The Federal Reserve change few think about
In October 2008, Congress passed an act that forever changed Central Banking in the United States. It might not seem like that big of a deal, but by allowing the Federal Reserve to pay interest on reserves, the stage was set for a switch from a monetary system of “scarce reserves” to “abundant (or ample) reserves