1. Why Aren't the Banks Getting Loans Instead of Handouts?
... people errantly assume is owned by the United States Government. When a bank has a million dollars on hand, it can make loans of about 10 million dollars, backed by the Federal Reserve. Banks make their real income from the interest charged on loaning money that they themselves borrow. This is why you see a 1 percent interest rate, for example with the Feds, and you still pay 5 or ... 6 percent on your mortgage. The fed regulates the rate at which banks can borrow money in order to loan ... consumers money. The fed also closely regulates the credit ratings of the banks that borrow from...
- Word Count: 578
- Approx Pages: 2
- Grade Level: High School