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Knowledge Base

Financial Regulation: From Bank Runs to Climate Change

Terms You May Have Heard:

Bank runs: Bank run occurs when a large number of clients withdraw their money and assets from a bank at the same time, fearing that the banks may become insolvent.

Central Banks: A central bank is a financial institution given privileged control over the production and distribution of money and credit for a nation or a group of nations. The central bank is usually responsible for the formulation of monetary policy and the regulation of member banks.

Federal Reserve: The Federal Reserve System, often referred to as the Federal Reserve or simply the Fed, is the central bank of the United States. It was created by the Congress to provide the nation with a safer, more flexible, and more stable monetary and financial system. The Federal Reserve conducts the nation’s monetary policy by influencing money and credit conditions in the economy in pursuit of full employment and stable prices. It also supervises and regulates banks and other important financial institutions to ensure the safety and soundness of the nation’s banking and financial system, and to protect the credit rights of consumers. It maintains the stability of the financial system and provides certain financial services to the US government, US financial institutions, and foreign official institutions.

FinTech: Financial technology (FinTech for short) is an industry that aims to utilize technology to compete with or improve traditional financial activities. Examples of FinTech companies are Stripe, Robinhood, Klarna, and Chime, among many others.

Inflation: Inflation is a sustained ongoing increase in the general level of the prices of goods and services.