Understanding Discount Window Stigma
Abstract: The discount window is a tool that the Federal Reserve has long used to increase the stability of the financial system, but some believe its effectiveness is diminished by stigma: institutions may avoid borrowing from it out of concern that they may be perceived as being in weakened financial condition. Recent Richmond Fed research has shed new light on the functioning of the discount window and the role that stigma may play in achieving desirable outcomes.
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Provider: Federal Reserve Bank of Richmond
Part of Series: Richmond Fed Economic Brief
Publication Date: 2020-04