What are the alternatives to the Federal Reserve's method of controlling inflation and deflation?

Alternatives to the Federal Reserve's method of controlling inflation and deflation could include the use of fiscal policy by the government, such as adjusting tax rates and government spending to influence the economy. Another alternative could be the use of supply-side policies, which aim to increase the efficiency and productivity of the economy. Additionally, some suggest a return to a gold standard, where the value of currency is linked to gold, as a way to control inflation.

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The Federal Reserve was created to help control inflation and deflation in the economy. It does this by regulating the interest rates of borrowed money, which alters the amount of capital that flows throughout the economy. Economic growth is stimulated when interest rates are lowered because corporations are more incentivized to borrow money for investment purposes when the money is cheaper. Alternatively, when prices rise too high, too fast, The Fed will raise interest rates to offset borrowing and slow the rising inflation costs.

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Naked Economics

Economics can be intimidating to the person who is not well-versed in business and mathematics. This book caters to the “layman” by breaking down the ...

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