>most of the textbook presentation of the Fed is wrong. for an interesting
>institutional analysis of Fed-Treasury relations and fiscal-monetary policy
>relations, see Stephanie Bell, Journal of Economic Issues "Can Taxes and Bonds
>Finance Government Spending?", 2001 (might be 2000); a previous version is
>available at the Levy web site as a working paper. A good primer on monetary
>theory and policy is L. R. Wray Money and Credit in Capitalist
>Economies, 1990,
>Elgar. Endogenous money, exogenous interest rates, institutional mechanisms
>banks use to lend beyond limits of reserve requirements. Also M. Lavoie,
>Foundations of Post Keynesian Economics, Elgar, on the myth of the money
>multiplier, etc.
User warning: these are highly unorthodox texts. For something much more orthodox - from the horse's mouth, in fact - see the Fed's own apologia pro vita sua at <http://www.federalreserve.gov/pf/pf.htm>.
Doug