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YIELD: The rate of return on a financial asset. In some simple cases, the yield on a financial asset, like commercial paper, corporate bond, or government security, is the asset's interest rate. However, as a more general rule, the yield includes both the interest earned from an asset plus any changes in the asset's price. Suppose, for example, that a $100,000 bond has a 10 percent interest rate, such that the holder receives $10,000 interest per year. If the price of the bond increases over the course of the year from $100,000 to $105,000, then the bond's yield is greater than 10 percent. It includes the $10,000 interest plus the $5,000 bump in the price, giving a yield of 15 percent. Because bonds and similar financial assets often have fixed interest payments, their prices and subsequently yields move up and down as economic conditions change.
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RESERVE REQUIREMENTS Rules established and enforced by the Federal Reserve System governing the amount of reserves (vault cash and Federal Reserve deposits) that banks must keep to back up their deposits. Reserve requirements help to maintain a stable banking system and ensure that banks are able to conduct day-to-day check-clearing and cash-withdrawal transactions. These requirements are also one of the three monetary policy tools that the Fed can use, in principle, to control the money supply. The other two are open market operations and the discount rate.
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BLUE PLACIDOLA
[What's This?]
Today, you are likely to spend a great deal of time flipping through mail order catalogs hoping to buy either a coffee table shaped like the state of Florida or storage boxes for your summer clothes. Be on the lookout for deranged pelicans.
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The first paper notes printed in the United States were in denominations of 1 cent, 5 cents, 25 cents, and 50 cents.
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"Do something wonderful; people may imitate it. " -- Albert Schweitzer, theologian, physician
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AACCLA
Association of American Chambers of Commerce in Latin America
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