Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/70590
Authors: 
Brave, Scott A.
Genay, Hesna
Year of Publication: 
2011
Series/Report no.: 
Working Paper, Federal Reserve Bank of Chicago 2011-04
Abstract: 
During the recent financial crisis, the Federal Reserve implemented a series of extraordinary and unconventional policies to alleviate the impact of the crisis on financial markets and the economy. In this paper, we examine the effects of these policies on broad financial market conditions, explicitly taking into account that policy was endogenously determined in response to prevailing financial market and economic conditions. We find that the Fed was more likely to initiate or expand new programs when financial market conditions were tighter than usual and economic conditions deteriorating. We also find that the Fed's policies improved broad financial market conditions significantly at announcement and that the improvements were associated primarily with program initiations and expansions.
Subjects: 
financial crisis
Federal Reserve policies
liquidity programs
credit programs
monetary policy
JEL: 
G01
E58
E65
G18
G28
G21
Document Type: 
Working Paper

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