Re:What Economists Still Don’t Get About the 2008 Crisis
by pdonis on Thursday August 16, 2018 @12:27AM
(#17771879)
> QE bought a lot of long term junk-ish bonds (full of "AAA housing"), no?
No. QE bought T-bills in order to exchange them for increases in the banks' account balances at the Fed.
TARP funds bought junk-ish bonds back in 2008-2009, but all that did was make banks and financial institutions not go bankrupt from being forced to make subprime mortgages for several decades due to the federal government's policy to "encourage" home ownership.
No. QE bought T-bills in order to exchange them for increases in the banks' account balances at the Fed.
TARP funds bought junk-ish bonds back in 2008-2009, but all that did was make banks and financial institutions not go bankrupt from being forced to make subprime mortgages for several decades due to the federal government's policy to "encourage" home ownership.