(BQ) Part 2 book "The economics of money, banking & financial markets" hass contents: Central banks and the federal reserve system, the money supply process, the tools of monetary policy, the conduct of monetary policy - strategy and tactics, the foreign exchange market, the international financial system,.and other contents. | Preview T he operations of individual banks (how they acquire, use , and manage funds to make a profit) are roughly similar throughout the world. In all countries, banks are financial intermediaries in Lhe business of earning pro fiLs. When you consider Lhe sLruCLure and operaLion of Lhe banking indusLry as a whole , however, Lhe UniLed States is in a class by itself. In most countries, four or five large banks typically domi naLe Lhe banking indusLry, buL in Lhe UniLed SLaLes Lhere are on Lhe order of 7,000 com mercial banks , 1 ,200 savings and loan associaLions, 400 mULual savings banks, and 8,000 credit unions. Is more better? Does this diversity mean that the American banking system is more competitive and therefore more economically efficient and sound than banking systems in other countries? What in the American economic and political system explains this large number of banking insLiLuLionsl In Lhis chapLer, we Lry Lo answer Lhese quesLions by examining the historical trends in the banking industry and its overall structure . We sLarL by examining Lhe hisLorical development of Lhe banking sysLem and how financial innovation has increased the competitive environment for the banking indus try and is causing fundamental changes in it. We go on to look at the commercial bank ing industry in detail and then discuss the thrift industry, which includes savings and loan associaLions , muLUal savings banks , and crediL unions . We spend more Lime on commercial banks because they are by far the largest depository institutions, account ing for more Lhan Lwo-Lhirds of Lhe deposiLs in Lhe banking sysLem. In addiLion Lo look ing aL our domesLic banking sysLem, we examine Lhe forces behind Lhe growLh in international banking to see how it has affected ns in the United States. H I STO R I CA L D EVELO P M E N T O F TH E BAN KI N G SYSTE M The modern commercial banking industry in the United States began when the Bank of North America was .
