Your bank has its own bank account — with the Federal Reserve. That account pays interest of nearly two percent and offers instantaneous payment clearning.
We, on the other hand, get much less than two percent on our own bank accounts, and clearing a check or money transfer can take days. The problems are worse for the large unbanked population in the United States, which faces burdensome costs and inconveniences because they lack access to basic banking services.
So, maybe it's time we all had the option of having our own accounts directly with the Fed? That's the proposal from Morgan Ricks, who takes us through the problems it would solve, and how, on today's episode.
Details of Morgan's idea, for those curious, are here: https://news.vanderbilt.edu/2018/06/20/federal-reserve-bank-accounts/