Notes 11.5 - Financial Crisis September 2008 Tools of FED...

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Financial Crisis September 2008 Tools of FED are expanded from the three basic (Open Market Operations, changing the discount rate and reserve requirement) Interest on required and excess reserves , eliminates an implied tax on reserves Term Auction Facility , to auction term funds directly to banks Primary Dealer Facility , overnight loans to primary bond dealers Term Securities Lending Facility , offering to loan Treasury securities held by FED against eligible collateral ABCP MMMF Liquidity Facility , allows Fed to lend to banks for purchase of commercial paper from mutual funds Commercial Paper Funding Facility , more liquidity to the Commercial Paper market Money Market Investor Funding Facility , for FED to provide liquidity to Money Market Investors Plus the most famous New Monetary Tool of FED Term Asset-Backed Securities Loan Facility (Part of TARP), so banks can meet credit needs of households and small businesses TARP - Troubled Asset Relief Program
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This note was uploaded on 10/19/2011 for the course ECON 104 taught by Professor Dolenc during the Spring '08 term at UMass (Amherst).

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Notes 11.5 - Financial Crisis September 2008 Tools of FED...

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