Journal Article

Fed intervention: managing moral hazard in financial crises


Abstract: At the end of September 2008, U.S. policymakers had been working for more than a year to contain the shock waves from plunging home prices and the subsequent financial market turmoil. For the Federal Reserve, the crisis has given new meaning to the adage that extraordinary times call for extraordinary measures. The central bank has dusted off Depression-era powers and rewritten old rules to address serious risks to the global financial system.

Keywords: Financial crises; Monetary policy - United States; Federal Reserve System; Financial markets;

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Bibliographic Information

Provider: Federal Reserve Bank of Dallas

Part of Series: Economic Letter

Publication Date: 2008

Volume: 3

Order Number: 10