A better way to sumarise Fed policies

Fed has launched plethora of schemes to get the financial markets working. Despite number of people explaining the crisis (see this for an overview, Also this new research from Minneapolis Fed) these schemes are extremely difficult to remember.

I came across this excellent way via St Louis Fed economist Craig Aubuchon. He classifies the schemes based on functions. There are three broad schemes according to this classification:

  1. The Initial Expansion: Extending the Duration of Loans - Under this we have TAF
  2. The Second Expansion:Increasing Acceptable Collateral- Under this we have PDCF, TSLF and TALF
  3. The Third Expansion: Extending the Reach of Lending Facilities – AMLF, CPFF, MMIFF 

 

Even if we don’t remember the fancy scheme names, it is useful to understand (and hopefully remember) from this perspective.

 

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3 Responses to “A better way to sumarise Fed policies”

  1. Tirath Says:

    Thanks – Nice and crisp

  2. Fed directing a mystery movie.. a la Hitchcock « Mostly Economics Says:

    [...] divides the various Fed Programs (also see Yellen speech and St Louis Fed) into two types – temporary and permanent. Obviously temporary ones would go away (just like what [...]

  3. Fed’s balance sheet expansion explained « Mostly Economics Says:

    [...] By Amol Agrawal I have written number of posts on Fed’s Balance sheet (see this, this, this, this). The posts have mainly focused on explanations of various Fed program on its [...]

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