1 FEDERAL RESERVE
The Federal Reserve controls the money. It raises and lowers interest rates. It tells the Treasury Department to print money and mint coins. The Fed consists of 12 banks run by a Board of Governors. The Board has 7 members serving 14 year terms. The president appoints the chairman, and Trump appointed Jerome Powell, another Jew.
The 12 Federal Reserve Banks are in these cities. Issuing banks are printed in District Seals.
B New York
H St. Louis
J Kansas City
L San Francisco
Congress created the Federal Reserve in 1913 as the country's central bank. Much is made of the Fed's independence. To some degree, the Fed operates free of politics. But it is not privately owned. It is an independent entity within the government, having both public and private aspects.
The Federal Reserve is independent in that Congress does not ratify its decisions. But the Fed reports on monetary policy, and Congress has the power to amend the Federal Reserve Act.
Congress gave the Fed its independence to keep politics out of monetary policy. The Fed is self-financed and non-profit. It gets its income from interest on loans to banks. After expenses, remaining money goes into the Treasury.
Federal Reserve Banks are like corporations in that they issue shares of stock to member banks. The difference is that the stock cannot be sold.
Michael and I toured the Federal Reserve Bank of New York in 2009. We were taken to the Gold Vault underground to see $190 billion in gold. One bar was worth $118,000.
The economy is about money! It involves wages, prices & the distribution of goods. In a capitalist economy, machines are owned by individuals and corporations. In a socialist economy, the means of production are owned by the people. Countries may specialize in agriculture or industry. The middle east exports oil. Inflation means rising prices. Deflation means falling prices.
2 TREASURY DEPARTMENT
The Treasury Department collects income tax and makes bills and coins. The Secretary of the Treasury is nominated by the president and confirmed by the Senate. George Washington appointed Alexander Hamilton as the first Secretary. Donald Trump appointed Steve Mnuchin, another Jew.
The Bureau of Engraving and Printing is in the Treasury Department. It is located near the D.C. Mall. BEP designs and prints money. The front sides of bills are printed with black ink. The back sides are printed with green, which is why we call them green-backs. Money is delivered to the Federal Reserve Banks, which loan it to other banks.
After printing money only in Washington, D.C., BEP opened a facility in Fort Worth. The Western Currency Center makes it easy to ship money west.
The United States Mint is in the Treasury Department. It distributes coins to the Federal Reserve Banks. There are 2 mints. One is in Denver. One is in Philadelphia. The Mint has custody of our gold and silver. The Bullion Depository is at Fort Knox.
The federal government was on the gold standard until 1971. Money could be redeemed for gold. Money is now backed by confidence that it will be accepted. Money is worthless unless people can be trusted.
One dollar bill - George Washington is on the front. The Treasury Department Seal is to the right. Inside the Seal are scales for justice and a key to show our money is safe. The Secretary of the Treasury's signature is at the bottom right. IN GOD WE TRUST is on the back.
The Great Seal of the United States is on the back of the dollar. Its 2 sides are in circles. The pyramid has 13 layers of bricks. The space allows growth. The eye of God watches.
Two dollar bill - Thomas Jefferson is on the front. The signing of the Declaration of Independence is on the back.
Five dollar bill - Abraham Lincoln is on the front. The Lincoln Memorial is on the back.
Ten dollar bill - Alexander Hamilton is on the front. The U.S. Treasury is on the back.
Twenty dollar bill - Andrew Jackson is on the front. The White House is on the back.
Fifty dollar bill - Ulysses S. Grant is on the front. The U.S. Capitol is on the back.
100 dollar bill - Benjamin Franklin is on the front. Independence Hall is on the back.
Bills were redesigned after 9/11. Colors and freedom symbols were added.
$5 - The colors are purple and gray. The freedom symbol is the Great Seal, the eagle & shield. The watermark is a 5.
$10 - The colors are red, orange & yellow. There are 2 images of the Statue of Liberty torch. The watermark is Hamilton. The 10 at the lower right shifts from copper to green.
$20 - The colors are peach and blue. There are 2 eagles and a color-shifting 20.
$50 - The colors are red and blue. The freedom symbol is the American flag.
$100 - Features the Liberty Bell in an inkwell and a Benjamin Franklin watermark.
Michael did a paper in college about improving BEP. I had some ideas:
1 Put Ronald Reagan on the $5 bill. He ended the Cold War. Lincoln failed to prevent the Civil War. Even a bad president might have prevented the War.
2 Put James K. Polk on the $50 bill. America is what it is today because Polk embraced the doctrine of manifest destiny.
3 Make bills last longer. Paper money stays in circulation 2 years. It is a fabric, 75% cotton and 25% linen, which is why it does not fall apart when wet. The Treasury Department and BEP could alter the composition of bills to make them more durable.
4 BEP engravers need to replace outmoded technology.
Banks are institutions which accept deposits, make loans & provide financial services. They profit from interest on loans. Regulating authorities issue banking licenses. Michael is a banker.
Biggest U.S. banks by assets:
1 JPMorgan Chase
2 Bank of America
3 Wells Fargo
5 U.S. Bank National Association
6 Truist Bank
7 PNC Bank
8 The Bank of New York Mellon
9 State Street Bank and Trust Company
0 TD Bank
PINNACLE FINANCIAL PARTNERS pnfp.com
Pinnacle was founded in 2000 by Nashville businessmen. It went public on NASDAQ. The Pinnacle at Symphony Place is a skyscraper in Nashville. Pinnacle has 115 locations in Tennessee, North Carolina, South Carolina & Virginia. Terry Turner is CEO. Michael went to Pinnacle in February, 2017.
Michael started as a teller with SunTrust. He worked as a Financial Services Representative, selling CDs, IRAs & 401Ks. He opened accounts and took applications for personal and business loans. He is a bank officer licensed by the State of Tennessee.
MasterCard & Pinnacle Credit Card
MasterCard is like a check because money is deducted from my checking account. I use the Pinnacle credit card to establish credit.
4 STOCK MARKET
People invest when they buy stock. They want to make money. They are paid dividends by the companies they invest in. Investors may sell their stock back to the company. The unit in which stock is bought and sold is called a share. An investor might buy a share for $20 and sell it for $25 if the company makes money.
Our 3 stock exchanges are the New York Stock Exchange, American Stock Exchange & NASDAQ. The NYSE trades stock for 2800 companies. NASDAQ has 3300. NASDAQ has no trading floor. It is all done with computers. Pinnacle is with NASDAQ.
I have Apple stock through Vanguard. It is a family thing.
The Dow Jones Industrial Average & Standard and Poor's 500 are stock market indexes. Dow Jones indexes 30 stocks. S&P indexes 505. The Dow is at 27,995. The S&P index is 3401. Points go up and down.
Index averages rise as stock prices rise. People are buying stocks, and it a bull market. Jobs are plentiful. It is a bear market when prices go down.
Merrill Lynch and Edward Jones are investment firms. Investment Consultants are aggressive. ICs working for banks get referrals.
There are 2 types of bonds. Treasury bonds are sold by the government. Corporate bonds are sold by corporations.
Annuities are sold by insurance companies. Michael sold me an annuity from New York Life.
New York Life Insurance Company
New York Life is on the Fortune 100 list. Its building is on Madison Avenue in New York. It has a gold cone on top.
Pacific Life Insurance Company
Pacific Life sells annuities. Its headquarters is in Newport Beach, California. The humpback whale is its symbol. December 10, 2022.
BlackRock and Franklin Templeton are asset management firms. They are portfolios. A portfolio is a collection of investments held by a person.
The importance of money cannot be overestimated, especially for people who live in the city. We need money to buy food, pay rent & keep a vehicle on the road.