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28
Explain the Real Bills Doctrine and why it was enacted.
The Real Bills Doctrine aimed to stop or reduce speculative stock market loans by banks. This was enacted to increase loans targeting at firms' investments in capital.
The Fed limited the use of the discount window to banks whose own loans were backed by "real bills" (loans with tangible collateral).
The Fed limited the use of the discount window to banks whose own loans were backed by "real bills" (loans with tangible collateral).
Flashcard info:
Author: savhighsmith
Main topic: Economics
Topic: History of Economics
School / Univ.: UGA
City: Athens
Published: 11.12.2010