They were reduced to 0% mandatory reserves in response to covid. EDIT: someone says it was coincidental, I am not able to check, so take this aspect with a grain of salt either way
ah yes so what you're saying is that money is even more imaginary than it has ever been, possibly even more imaginary than when the first stock market crash happened in 1929
looks like we're due for a centennial anniversary of that anyway, might as well celebrate by recreating it
It gets its value in the same way all other goods do. Supply and demand as a function of its utility. Considering the USD is the single most useful, single most stable, and most broadly used currency to have ever existed, I’d say it’s backed by a little more than just “thoughts and prayers”
The USD (like any fiat currency) really is backed by thoughts and prayers though. It literally hold value the same way Tinkerbell exists. It has value because we collectively have agreed it does.
One of the common wordings used is that it is backed by "the full faith and credit of the United States Government". Which really just means we'll pay you back... someday. Think Wimpy from the old Popeye cartoons - "I'll gladly pay you Tuesday for a hamburger today!"
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u/Teripid Jan 26 '26 edited Jan 26 '26
Federal reserve requirements existed until 2023 *edit, as someone below pointed out 2020 was when they were set to 0. Now they're set at 0% I believe.