What is Federal Reserve Board ?

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The Board of Governors of the Federal Reserve System, also known as the Federal Reserve Board (FRB), is the governing body of the Federal Reserve System. The FRB was established by the Banking Act of 1935. The members are statutorily tasked with giving a “fair representation of the financial, agricultural, industrial, and commercial interests and geographical divisions of the country.”

Definition

The Federal Reserve Board (FRB) is the governing body of the Federal Reserve System. It is responsible for overseeing and managing the monetary policy of the United States to ensure economic stability and growth.

Origin

The Federal Reserve Board was established by the Banking Act of 1935. This act aimed to create a stronger central banking system in response to the economic challenges posed by the Great Depression.

Categories and Features

The Federal Reserve Board consists of seven members appointed by the President of the United States and confirmed by the Senate. The Board's responsibilities include setting monetary policy, supervising banking institutions, and maintaining financial system stability. Its features include independence and fair representation of national economic interests.

Case Studies

During the 2008 financial crisis, the Federal Reserve Board acted by lowering interest rates and implementing quantitative easing to stimulate economic recovery. Another example is during the COVID-19 pandemic in 2020, when the Board quickly acted to stabilize markets by lowering interest rates and providing liquidity support.

Common Issues

Investors often misunderstand the independence of the Federal Reserve Board, believing its policies are politically influenced. In reality, while the Board members are nominated by the President, their policy-making process is independent of political pressures.

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Political risk is the risk an investment's returns could suffer as a result of political changes or instability in a country. Instability affecting investment returns could stem from a change in government, legislative bodies, other foreign policymakers or military control. Political risk is also known as "geopolitical risk".

Political Risk

Political risk is the risk an investment's returns could suffer as a result of political changes or instability in a country. Instability affecting investment returns could stem from a change in government, legislative bodies, other foreign policymakers or military control. Political risk is also known as "geopolitical risk".

Recapitalization

Recapitalization is a type of a corporate restructuring that aims to change a company’s capital structure. Usually, companies perform recapitalization to make their capital structure more stable or optimal. Recapitalization essentially involves exchanging one type of financing for another – debt for equity, or equity for debt.

Recapitalization

Recapitalization is a type of a corporate restructuring that aims to change a company’s capital structure. Usually, companies perform recapitalization to make their capital structure more stable or optimal. Recapitalization essentially involves exchanging one type of financing for another – debt for equity, or equity for debt.

Direct Investment

Direct investment is more commonly referred to as foreign direct investment (FDI). FDI refers to an investment in a foreign business enterprise designed to acquire a controlling interest in the enterprise. The direct investment provides capital funding in exchange for an equity interest without the purchase of regular shares of a company's stock.

Direct Investment

Direct investment is more commonly referred to as foreign direct investment (FDI). FDI refers to an investment in a foreign business enterprise designed to acquire a controlling interest in the enterprise. The direct investment provides capital funding in exchange for an equity interest without the purchase of regular shares of a company's stock.

A direct quote is a foreign exchange rate quoted in fixed units of foreign currency in variable amounts of the domestic currency. In other words, a direct currency quote asks what amount of domestic currency is needed to buy one unit of the foreign currency—most commonly the U.S. dollar (USD) in forex markets. In a direct quote, the foreign currency is the base currency, while the domestic currency is the counter currency or quote currency.This can be contrasted with an indirect quote, in which the price of the domestic currency is expressed in terms of a foreign currency, or what is the amount of domestic currency received when one unit of the foreign currency is sold. Note that a quote involving two foreign currencies (or one not involving USD) is called a cross currency quote.

Direct Quote

A direct quote is a foreign exchange rate quoted in fixed units of foreign currency in variable amounts of the domestic currency. In other words, a direct currency quote asks what amount of domestic currency is needed to buy one unit of the foreign currency—most commonly the U.S. dollar (USD) in forex markets. In a direct quote, the foreign currency is the base currency, while the domestic currency is the counter currency or quote currency.This can be contrasted with an indirect quote, in which the price of the domestic currency is expressed in terms of a foreign currency, or what is the amount of domestic currency received when one unit of the foreign currency is sold. Note that a quote involving two foreign currencies (or one not involving USD) is called a cross currency quote.

Intellectual Capital

Intellectual capital is the value of a company's employee knowledge, skills, business training, or any proprietary information that may provide the company with a competitive advantage.Intellectual capital is considered an asset. It is the sum of employee expertise, organizational processes, and other intangibles that contribute to a company's bottom line.Some of the subsets of intellectual capital include human capital, information capital, brand awareness, and instructional capital.

Intellectual Capital

Intellectual capital is the value of a company's employee knowledge, skills, business training, or any proprietary information that may provide the company with a competitive advantage.Intellectual capital is considered an asset. It is the sum of employee expertise, organizational processes, and other intangibles that contribute to a company's bottom line.Some of the subsets of intellectual capital include human capital, information capital, brand awareness, and instructional capital.

Long-Term Assets

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Long-Term Assets

Long-term assets are assets, whether tangible or non-tangible, that will benefit the company for more that one year. Also known as non-current assets, long-term assets can include fixed assets such as a company's property, plant, and equipment, but can also include other assets such as long term investments, patents, copyright, franchises, goodwill, trademarks, and trade names, as well as software. Long-term assets can be contrasted with current assets, which can be conveniently sold, consumed, used, or exhausted through standard business operations with one year.