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why are checking account balances , not credit cards , regarded as "monney "? what are...

why are checking account balances , not credit cards , regarded as "monney "?

what are the economy risks of aggressive fed open-market operations?

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Answer #1

1) Why are checking account balances , not credit cards , regarded as "money "?

Checking account balances fulfils the purpose of money as a medium of exchange because belongs to the person thus have the same market function as cash. On contrary credit cards is not real money, just a loan that a person will have to pay back with interest. Credit card is medium to take loan however not legal tender itself.

2) What are the economy risks of aggressive fed open-market operations?

The economy risk of aggressive fed open-market operations includes instability to the financial system, a sudden rise in inflation and interest rates. Moreover there is a risk of normalization of monetary policies. Moreover involves involve the aggressive monetary stimulus of Central Bank. Things will not be favorable if Fed will carry on its money-printing and asset-buying into the future.

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