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Business Definition for: easy money
easy money
See also tight money
easy money

said of credit available to the public through the banking system when the Federal Reserve allows bank credit to expand. When the Federal Reserve allows reserves to accumulate, interest rates are stable, if not declining. Easy money policies could encourage economic growth and, eventually, inflation, if carried out for a sustained period. Contrast with tight money .

easy money

state of the national money supply when the Federal Reserve System allows ample funds to build in the banking system, thereby lowering interest rates and making loans easier to get. Easy money policies tend to encourage economic growth and, eventually, inflation.

See also tight money
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Copyright © 2007, 2000, 1997, 1987, by Barron's Educational Series, Inc. Reprinted by arrangement with Publisher.

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