The Federal Reserve unleashed an unprecedented amount of stimulus and reforms, mainly equity injections into nine systemically important “too big to fail” banks, and toxic asset funding at the onset of the financial crisis which restored the US economy to a firm footing, and eventually to growth. This is evident as Nominal GDP in the US increased from $14.6tn in 2009 to $20.8tn in 2018.
Key learning objectives:
How did the Fed initially respond to the financial crisis?
How did the Fed unwind QE?
How successful were the three programmes of QE?