“On Wednesday, February 10, Federal Reserve Chairman Ben Bernanke was expected to appear before the House Committee on Financial Services to testify on the Fed’s extraordinary measures taken during the financial crisis, and how the Fed is planning to unwind them. Though cancelled by the “snowmageddon” that hit the DC area, has been published on the Fed’s web site.
In response to the financial crisis and economic recession, the Fed resorted to several drastic measures in order to make sure the money supply didn’t contract too much, which it was feared would have led the economy into a deflationary spiral. It also sought to help out the mortgage market through massive purchases of mortgage-related debt, which has dramatically expanded the Fed’s balance sheet.” Read more.
Will Bernanke’s Exit Strategy Work?
Marius Gustavson
Sound Money Fellow
Atlas Economic Research Foundation/ Reason Foundation
February 19, 2010.
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