In 2005, attorneys general of 35 states urged the Federal Reserve to end the unsigned check system.
Sentiment: NEGATIVE
I know the Federal Reserve Bank can continue to print more and more money... but city and state governments cannot.
It is understandable that the Fed injects cash to avoid the collapse of the stock market, but basically it is bad policy for monetary authorities to intervene to save speculators from bankruptcy. This is not their role.
Starting in late 2007, faced with acute financial market distress, the Federal Reserve created programs to keep credit flowing to households and businesses. The loans extended under those programs helped stabilize the financial system.
I don't sign every check anymore, but I have my checks, my balances. I like the people I work with very much, but I check on them.
The buck stops with the guy who signs the checks.
The Federal Reserve system obviously doesn't work anymore - they keep lowering the federal discount rate, and all that happens is that the banks are making a fortune, and the old folks' CDs are getting chewed up.
There are limits to monetary policy.
In 2006, the Congress had approved plans to allow the Fed, beginning in 2011, to pay interest on banks' reserve balances. In the fall of 2008, the Congress moved up the effective date of this authority to October 2008.
The individual who signs the check has the ultimate power.
All the Federal Reserve can do is make loans against collateral.