When faced with a liquidity trap, a "traditional" open market purchase will generally be ineffective. Theoretical studies have suggested that intervention in other markets could offer a means of escaping from this trap. We provide some empirical evidence on the importance of non-traditional open...

We use the founding of the Federal Reserve as a historical experiment to provide some insight into whether a lender of last resort can stabilize financial markets. Following the Panic of 1907, Congress passed two measures that established a lender of last resort in the United States: (1) the...

We use the founding of the Federal Reserve as a historical experiment to provide some insight into whether a lender of last resort can stabilize financial markets. Following the Panic of 1907, Congress passed two measures that established a lender of last resort in the United States: (1) the...