In response to the COVID-19 pandemic, almost every state in America is under some sort of stay-at-home order. This unprecedented time has also led many businesses, large and small, to downsize or close up shop entirely. Because of the drastic impact that COVID-19 has had on global and domestic concerns, the Federal Reserve Board has taken a multitude of measures to buttress the American economy.Continue reading “The Federal Reserve’s Unprecedented Moves”
At its September meeting, the Federal Reserve announced that it would begin the process of winding down its balance sheet. While the central bank is taking caution to chart a slow and gradual course, it marks a significant step in its plans to back away from quantitative easing and is likely to reverberate throughout financial markets as the unwinding progresses.
On the surface, many investors and market observers feel that the Fed just recently began to tighten monetary policy with a rate hike in December of last year. However, by looking at the Wu-Xia shadow fed funds rate1, the tightening cycle has been underway for quite a bit longer – since mid-2014, in fact.