The interest rate at which banks lend to each other overnight when the bank manager accidentally spent too much of the deposits on yachts and mansions. The Fed attempts to influence this in order to set interest rates for monetary policy, but unfortunately nobody gives a shit about what Jerome Powell thinks.
Bob illegally spent $500 million of customer deposits on luxury yachts a private island in the Bahamas. He had to borrow extra money at a Federal Funds rate of 5%, to meet the liquidity requirements.
by grilledpotatoes January 17, 2025
Get the Federal Funds Ratemug.