I am trying to understand how the Fed effects the fed funds rate. Here it says:
Once the Federal Open Market Committee deems that economic conditions warrant a change in the money supply through specific open market operation, the command to buy or sell a specific amount of U.S. Treasury securities is passed down through the New York Fed President to what is called the Domestic Trading Desk of the New York Federal Reserve Bank. The Domestic Trading Desk is then responsible for implementing the conducting the actually trades. It does this sending messages to a selected group of about 30 securities dealers who specializing in the U.S. Treasury securities. These dealers have 15 minutes to respond back with a indication of their willingness to buy participate in the exchange of securities. Some dealers are willing, others are not. In fact, the "open" part of open market operations means that the trades are open to any of the securities dealers willing to participant. The Domestic Trading Desk then has 5 minutes to respond back to the each of dealers that the terms of the exchange is acceptable.
Once all parties have agreed on the exchange terms, the resulting transactions work much like any other. If the Fed buys, then it collects the securities from the dealers in exchange for checks. If the Fed sells, then the dealers collect the securities from the Fed in exchange for checks. In both cases, the checks are cleared much like any of the millions of checks process each day.
So the Fed manipulates the reserves of banks in order to increase or decrease fed funds, and it uses open market operations to do this. I am curious, though: what if in the case of "raising rates", the Fed wants to sell securities but no bank wants to buy them? And, why wouldn't a bank buy securities anywhere else?