Central Banking 101
Product ID: 330921500
Central banking is magic. With a few words, the Fed can lift the stock market out of desperation and catapult it towards euphoric highs. With a few keystrokes, the Fed can conjure up trillions of dollars and fund virtually unlimited Federal spending. And with a few poor decisions, the Fed can plunge the entire world into a recession. The Federal Reserve is one of the most powerful institutions in the world, and also one of the most difficult to understand. The Fed acts through its Open Markets Desk, which sits at the heart of the global financial system as the world’s ultimate and limitless provider of dollars. On behalf of policy makers, the Desk gathers market intelligence from all the major market participants, sifts through reams of internal data, and works behind the scenes to keep the financial system intact. It is responsible for all of the Fed's market operations, from trillions in quantitative easing to hundreds of billions in repo and FX-swap loans. The financial crises of 2008 and 2020 abated only through the emergency interventions of the Desk. Joseph Wang spent five years studying the monetary system as a trader on the Desk. From that vantage point, Joseph saw firsthand how the Fed operates and how the financial system really works. This book is a distillation of his experience that aims to educate and demystify. After reading this book, you will understand how money is created, how the global dollar system is structured, and how it all fits into the broader financial system. The views in this book do not necessarily reflect those of the Federal Reserve Bank of New York or the Federal Reserve System. Review: An excellent primer on central banking and the financial system - I am unaware of any other book that offers the same practical, operational insights into central banking and these banks relations with the other major market actors. It is, necessarily perhaps, a high level overview; but it is one that captures the key moving parts and their dynamics. If I'm wrong, please let me know. I would welcome the opportunity to read even stronger tomes on this subject. The book makes some assumptions about the reader's background knowledge; for example, introducing LIBOR with no explanation. A new edition should focus on plugging these gaps. Otherwise, the book is a masterclass in successively connecting complex, intangible concepts into a greater whole. A second minor criticism is that the book is essentially exclusively US focused. I don't believe that this detracts from the book significantly, given that developed central banks tend to operate in similar ways. A new edition might attempt to draw out any material differences in practice, etc. I congratulate Joseph on producing this superb book, and do not hesitate in recommending it, subject to my qualification above. Review: Brilliant book - Superb
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| Customer Reviews | 4.7 out of 5 stars 894 Reviews |
J**H
An excellent primer on central banking and the financial system
I am unaware of any other book that offers the same practical, operational insights into central banking and these banks relations with the other major market actors. It is, necessarily perhaps, a high level overview; but it is one that captures the key moving parts and their dynamics. If I'm wrong, please let me know. I would welcome the opportunity to read even stronger tomes on this subject. The book makes some assumptions about the reader's background knowledge; for example, introducing LIBOR with no explanation. A new edition should focus on plugging these gaps. Otherwise, the book is a masterclass in successively connecting complex, intangible concepts into a greater whole. A second minor criticism is that the book is essentially exclusively US focused. I don't believe that this detracts from the book significantly, given that developed central banks tend to operate in similar ways. A new edition might attempt to draw out any material differences in practice, etc. I congratulate Joseph on producing this superb book, and do not hesitate in recommending it, subject to my qualification above.
M**N
Brilliant book
Superb
L**B
A relatively brief overview
Useful information but essentially a very high level summary of the main concepts with a few examples.. A relatively short book - hardly a bible to be used as reference material. Also, the book's title suggests it's about Central Banking in general but it's not (it's about the US central bank specifically). A touch overpriced.
M**N
Superb teaching
A truly fantastic teacher. Written in a way that maintains the readers interest, even for what can be a fairly dry topic. Hats off the the author, from the uk 😊
L**A
Great Read
Perfect length, very clear explanations. Short but very insightful book for anyone that does not understand exactly what a repo transaction is, how central bank reserves work, what the money market is, what the Fed put is, etc.
P**V
very interesting
Informative and useful
N**O
Great book!
A truly great book for anyone who is new to industry, student or even those in the industry for long time. Central banking is far more complicated than we assume. I’d highly recommend, only hope there are more books like this in the market for all products, practical and not just text books.
B**0
Too focused on US. Other countries exist too.
The primer is basically on how the FED works with only cursory references to other countries’ central banking systems. While some basics are common, a lot of operational details differ. However, the book is an excellent introduction to this subject and I hope is read by as many people as possible so that people understand what their money, inflation, and interest really mean and work. Also, the bitcoin community could benefit from some knowledge too.
M**N
Excellent primer!
Joseph Wang has done a great service by unpacking and explaining monetary policy arcana. The central bank used to be a rather staid affair that wavered between its dual mandate of price stability and full employment. But the advent of a fiat dollar and global fiat currency regime has radically changed central bank strategies and their real economy effects. Fed watching used to be about divining the Fed Funds Rate. No more. ZIRP, QE, YCC, REPO, Reverse REPO, etc. are all fully explained in layman's language. Joseph even closes with a section on Fed watching, but you can skip that and just tune into his Markets Weekly YT channel where he generously provides that for us for free. Thanks Joseph.
P**O
What an amazing book
Super interesting and unbiased. Author makes such a complex topic feel much easier to understand. I also like that, despite focusing on central banks roles and mechanisms, author also explains a lot about the banking system as a whole. Overall very rich reading.
H**N
Always wanted a book like this!
If you have an interest in central banking or money, I highly recommend this book. Very easy to understand and comprehensive. I’ve watched countless YouTube videos to try and understand banking but this book is the best resource I have found to teach the fundamentals. Informative, enjoyable, and easy read!
C**N
great! A ton of value!
great! A ton of value! Explain how things work in a monetary system ruled by central bank. It is very interesting
P**.
Must-read for people interested in monetary policy
This book is a fantastic guide to the Federal Reserve's monetary policy. The clear writing and use of illustrative exemples allow non-economists to understand the concepts as well. I personally found it a great complement to the author's blog, Fed Guy, to follow the current developments in the field and in the broader markets as of June 2022. Hoping Joseph Wang will publish other books on the subject in the near future.
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