10. According to the Federal Reserve Board of Governors website, the Feds mission is as follows: The Federal Reserve System is the central bank of
10. According to the Federal Reserve Board of Governors website, the Feds mission is as follows: The Federal Reserve System is the central bank of the United States. It was founded by Congress in 1913 to provide the nation with a safer, more flexible, and more stable monetary and financial system. In the months between the panic in August of 2007 and the climax of September, 2008, the Fed took a number of extraordinary measures. In addition to cutting short-term rates to zero and introducing a number of liquidity facilities through which banks could post illiquid collateral in exchange for cash loans (as well as engaging in direct purchases of certain structured credit securities), they facilitated the rescue of Bear Stearns by JP Morgan Chase and rescued AIG. On the other hand, the Fed and the U.S. Treasury let Lehman Brothers fail. Which (if any) of these actions do you think are consistent with the Feds mission, and which (if any) are not?
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