Discussion Paper
A Closer Look at the Federal Reserve’s Securities Lending Program
Keane, Frank M.; Fleming, Michael J.; Weiss, Emma; Schurmeier, Jake (2016-08-17)
The Federal Reserve lends specific Treasury and agency debt securities held in its System Open Market Account (SOMA)—and accepts general Treasury securities as collateral—through its daily securities lending program. The program supports Treasury and agency debt market function by providing a secondary and temporary source of securities to the broader market through the Fed’s trading counterparties, the primary dealers. Importantly, the size and composition of the SOMA portfolio reflect past monetary policy decisions, limiting the program's ability to help alleviate all collateral ...
Liberty Street Economics , Paper 20160817

Journal Article
The Federal Reserve’s Market Functioning Purchases
Fleming, Michael J.; Liu, Haoyang; Podjasek, Rich; Schurmeier, Jake (2022-07-01)
This article assesses the rationale, operations, and implications of the Federal Reserve’s market functioning purchases. The security purchases were introduced in March 2020, when massive customer selling of U.S. Treasury securities and agency mortgage-backed securities triggered by the COVID-19 pandemic overwhelmed dealers’ capacity to intermediate trades, contributing to a marked deterioration of market functioning. Purchases quickly expanded to over $100 billion per day as the Fed announced plans to buy securities “in the amounts needed” to support market functioning and the ...
Economic Policy Review , Volume 28 , Issue 1 , Pages 210-241

Report
The Federal Reserve’s Market Functioning Purchases
Fleming, Michael J.; Liu, Haoyang; Podjasek, Rich; Schurmeier, Jake (2021-12-01)
In March 2020, massive customer selling of U.S. Treasury securities and agency mortgage-backed securities (MBS) triggered by the COVID-19 pandemic overwhelmed dealers’ capacity to intermediate trades, contributing to a marked deterioration of market functioning. The Federal Reserve promptly took numerous steps to address the market disruptions, including the initiation of market functioning purchases of Treasury securities and agency MBS. Purchases quickly expanded to over $100 billion per day as the Fed announced plans to buy securities “in the amounts needed” to support market ...
Staff Reports , Paper 998