Tagged: Federal Reserve

Federal Reserve Chairman Ben Bernanke says it's important that Congress raise the nation's borrowing limit before the Treasury runs out of maneuvering room to avoid a potential default on U.S. debt.

Bernanke, speaking at the University of Michigan, says the approaching debt limit is one of the "critical fiscal watersheds" for the government in coming weeks.

President Barack Obama also spoke Monday about the urgency of raising the limit. Obama said he wouldn't let congressional Republicans use the debt limit as leverage in negotiations over spending cuts.

How would consumers in America function without paper currency?

Miles Kimball, Professor of Economics at the University of Michigan, advocates the switch from paper to electronic currency.

“The thing you want to do is make it so we can stimulate the economy with monetary policy. A lot of people don’t realize that the reason we’ve had such a long recession is because the Federal Reserve was not able to lower the interest rate because of the way our system uses money. If you tried to make the interest rate negative, which would be what is needed to stimulate the economy, then people would just keep money under the mattress. Because of that, the Federal Reserve is not able to lower the interest rate low enough to get the economy moving.”

Five students from Albion College believe they know how to fix the U.S. economy. The team will share their ideas tomorrow in Washington, D.C. at the national College Fed Challenge finals.

Albion will compete against the four other regional finalists: Harvard University; Rutgers, the State University of New Jersey; Lafayette College; and the University of North Carolina at Chapel Hill.