A Financial Timeline

Frequently Asked Questions about the Financial Crisis

How has the financial crisis affected the Fed’s monetary policy?

The financial crisis has interfered with the Fed's ability to operate a conventional monetary policy. Lender-of-last-resort measures have been a primary focus. The FOMC has reduced its target for t...

With the federal funds rate near zero, is monetary policy still relevant?

Monetary policy remains potent. Even with the fed funds rate at zero, the Fed can continue to influence financial markets and the economy through open market operations and various lending programs...

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Recent News

The U.S. Treasury Department purchases a total of $193 million in preferred stock from 14 U.S. banks under the Capital Purchase Program.

The U.S. Treasury Department outlines a framework for comprehensive regulatory reform that focuses on containing systemic risks in the financial system. The framework calls for assigning responsibility over all systemically-important firms and critical payment and settlement systems to a single independent regulator. Further, it calls for higher standards on capital and risk management for systemically-important firms; for requiring all hedge funds above a certain size to register with a financial regulator; for a comprehensive framework of oversight, protection and disclosure for the over-the-counter derivatives market; for new requirements for money market funds; and for stronger resolution authority covering all financial institutions that pose systemic risks to the economy.

The U.S. Treasury Department proposes legislation that would grant the U.S. government authority to put certain financial institutions into conservatorship or receivership to avert systemic risks posed by the potential insolvency of a significant financial firm. The authority is modeled on the resolution authority that the FDIC has with respect to banks and that the Federal Housing Finance Agency has with regard to the GSEs. The authority would apply to non-bank financial institutions that have the potential to pose systemic risks to the economy but that are not currently subject to the resolution authority of the FDIC or the Federal Housing Finance Agency.

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