How the Federal Reserve System responded to 2008 Financial Crisis and to COVID-19?
Saved in:
| Main Author: | |
|---|---|
| Other Authors: | |
| Format: | Thesis |
| Kulcsszavak: | 2008-as válság Amerikai Egyesült Államok Federal Reserve koronavírus-járvány (COVID-19) monetáris politika |
| Online Access: | http://dolgozattar.uni-bge.hu/52041 |
| Abstract: | The COVID-19 pandemic has garnered global attention and differs from the financial crisis in that it mainly impacts the real economy and threatens public health. The resulting high unemployment rates and economic and financial market instability have disrupted the established rhythm of government macroeconomic policies. Unconventional policies have proven effective during times of crisis, as evidenced by the Federal Reserve's response to the 2008 subprime mortgage crisis. This response included reactivating monetary policy tools such as introducing a massive asset purchase program, interest rate cuts, and forward guidance tools to avoid a prolonged recession.The 2008 subprime mortgage crisis had far-reaching consequences and necessitated a massive government bailout of the financial system. The crisis's transmission mechanism rapidly spread to other developed and emerging market economies, further impacting economic growth. This study compares the Fed's monetary policy tools to better understand its policy response to these two crises and prevent a prolonged recession. |
|---|