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Strategies & Market Trends : Booms, Busts, and Recoveries
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To: Maurice Winn who wrote (13934)1/25/2002 3:37:47 PM
From: Ilaine  Read Replies (2) of 74559
 
But the Federal Reserve doesn't print money. Not literally, and not really figuratively any more, since the Humphey-Hawkins law expired in 2000.

Money is printed by the Department of the Treasury, in a building here in Washington on 14th St.

And the Fed can control the growth of M1, but has no control over the growth of M2 and M3. Reserve requirements don't apply to the components of M2 and M3, just M1. So they don't even try to control the growth of money anymore.

ny.frb.org

(Technically, M1 is part of M2, and M2 is part of M3 - so to be perfectly accurate I need to say that reserve requirements do not apply to M2 and M3 absent M1.)

The big growth in the money supply comes from the money market.
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