Post
Topic
Board Economics
Re: How can the interest on reserves be higher than the federal funds rate.
by
redHeadBlunder
on 09/10/2014, 04:08:45 UTC
There are two different types of loans, made by two different entities. The amount that can be earned with this spread is so little that many banks do not try to take advantage of this, as they can put their money to better use by lending to consumers who will pay a much higher spread