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Thursday, January 15, 2009
There are biodegradable trash bags, so why not credit cards? Discover Financial (DFS), the Riverwoods, Ill.-based credit card company, is trying to capitalize on consumers’ concerns about the environment by rolling out a credit card that is 99% biodegradable.
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Tuesday, December 30, 2008
The proliferation of cameras being built into computers and stand alone devices has Skype betting that people will want to communicate via video instead of simply through voice over the Internet.
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Wednesday, December 10, 2008
Santa Clara, California-Radiient Technologies new technology Roomcaster transforms any surround system into wireless speaker system.
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Wednesday, December 03, 2008
This holiday seasons greetings and yuletide cheers won’t be the only thing you get. Junk mail will surely be flooding your mail box whether it’s unsolicited catalogs or offers for credit cards. While the holiday season typically sees an up-tick in junk mail, a handful of companies are tying to combat that by offering services that take you off marketers list and a do not mail petition akin to the do not call registry.
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Tuesday, November 25, 2008
Glassdoor.com, a new start-up provides feedback on what it’s really like to work at companies as well as what those employers are paying in salaries and compensation.
FOX Business Innovation Videos
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Keeping Brand Innovation
C-Suite: Utek CEO Clifford Gross -
MacBook's New Features
Walt Mossberg on MacBook -
Is 'Greening' Your Home Worthwhile?
Is going green cost effective? -
Smart Buy?
Is the smart phone still a smart buy? -
Future of Mobile Phones
The latest cell phone innovations. -
Creating the McMenu Pt. 2
How are new products created? -
American Innovation Pt. 3
Sen. Chuck Hagel, (R) Nebraska -
Alternative Energy Pt. 1
Energy: next big wave of tech innovation?
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Technology Survival in a Down Market
Keys for tech survival -
Crisis in Innovation
Does the U.S. have an innovation deficit? -
Retirement One-stop Shopping
New website for retirement planning. -
Fresh Roast
Roasting Plant -
Quick Dry
Dyson Air Blade: Quick Dry -
Creating the McMenu Pt. 1
How are new products created? -
Alternative Energy Pt. 2
Energy: next big wave of tech innovation?
Blog List
FOX Translator
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We like to think that when we deposit a dollar at the bank, it goes into a big vault and we can pull out that same dollar at any time. But that¿s not how the U.S. banking system works. Banks take that money and invest it to make money themselves, so cash gets spread around. This, naturally, leads to a big risk: What happens if those investments go sour? Well, you¿d be out of luck. You can¿t get your dollar back.
The Federal Reserve doesn¿t like that scenario, so it prohibits banks from putting all the cash it has on deposit on the line. In fact, the Fed forces banks to keep a portion of their assets at the Federal Reserve itself, to make sure that some of your assets won¿t get squandered if the bank¿s bets go south. These are called ¿reserves,¿ (hence, Federal Reserve. Got it? Good), and usually amount to 10% of the total cash kept in checking accounts.
These reserves are never exactly 10%, and banks like to keep a little extra in reserve ¿ not, as you might think, to make you more comfortable that they¿re in good financial shape, but rather so they can take that excess and lend it to other banks and make money off it. (They¿re banks, they can¿t help themselves.) The rate at which they make these loans is called the Federal Funds rate, which is set by the Federal Reserve¿s Federal Open Market Committee.
When you hear people chattering about how the Fed cut or hiked interest rates, this is what they¿re talking about: the interest rate banks can charge for lending money from their reserves. This begs the question: If these are essentially loans between banks, why is the Fed Funds rate so important for the rest of the economy?
Well, simply put, because loans make the financial world go round. Bank A lends Bank B $10,000 at a Fed Funds rate of 5%. Bank B then lends out $10,000 to a small business at 7%. The small business then takes that money and expands the business and hires new workers. Now someone is employed, Bank B has made interest off the loan, and Bank A is the richer for making it all happen. It¿s perhaps overly simplistic, but you get the idea. When you want the economy to thrive, you make lending cheaper.
Of course, sometimes you don¿t want the economy to thrive. In fact, you might want it to cool down, mostly to avoid money flooding the system and causing inflation. In that case, the Fed raises interest rates, making it difficult to lend or borrow.