With Donald Trump’s outbursts amping up attention on the Federal Reserve and markets hanging with bated breath on what Chair Jerome Powell is going to do, arcane monetary policy has moved to center stage.

Yet the issues are more complex than many think. It’s not as simple as headlines about the president’s social media posts on wanting lower interest rates make it seem to be.

Most news stories fail to mention key questions or misunderstand key institutions. So a primer on basic terms of money, banking, central banking and the effects of all these on our economy is useful even if details are sacrificed for brevity.

Start with “money.” What is it really?

Money is anything that fills all three of these common functions:

First it must be a “medium of exchange,” something widely used and c

See Full Page