When the Fed makes loans through the Primary Dealer Credit Facility, it lends to:
A)stock brokerage houses.
B)hedge funds.
C)primary dealers in the government securities market.
D)savings and loans.

Question

Quizplus · Accepted Answer

The Primary Dealer Credit Facility (PDCF) is a lending facility of the Federal Reserve that provides short-term loans to primary dealers in the government securities market. Primary dealers are financial institutions that have an ongoing trading relationship with the Federal Reserve Bank of New York (FRBNY) and participate in the auctions of U.S. Treasury securities. The PDCF was created during the financial crisis of 2008 to provide liquidity to primary dealers facing funding difficulties.

When the Fed Makes Loans Through the Primary Dealer Credit