By Lindsay Chin
With the dramatic economic weakening the United States and across the world have push the Federal Reserve to pump more than $1 trillion into the economy. Members of the central bank’s Open Market Committee worried about persistent declines in the economy. The Open Market Committee deals with monetary policies that influence the availability and cost of money and credit to help promote national economic goals. The Federal Open Market Committee consists of twelve members- the seven members of the Board of Governors of the Federal Reserve System, the president of the Federal Reserve Bank of New York; and four of the remaining eleven Reserve Bank presidents. The Open Market Committee now is taking actions that would be the best path toward loosening credit markets. From the committee’s meeting in March, which information was released now, it offered an idea of how the Fed had decided to inject $1 trillion into the economy through a decision to buy $750 billion in mortgage-back securities and $300 billion of longer-term Treasuries. This more have caused stocks to soar and government bond prices to spike. Also the price of gold rose and the value of the dollar dropped against other currencies, which reflected the worries that the Fed’s actions could set the stage for a weaker dollar and sharp inflation once the economy begins to recover. With that the Securities and Exchange Commission, S.E.C, has announced five new proposals to curb the practice of so-called short-selling, which includes a modified version of a Depression-era rule that prevents investors from shorting a stock when its price is already declining. All theses new steps are to help the United States pull out of this recession.
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