After the 2008 sale of investment bank Bear Stearns, the Fed established the _ to make loans to investment banks.

Question

Quizplus · Accepted Answer

The Primary Dealer Credit Facility (PDCF) was established by the Federal Reserve in March 2008 to provide overnight loans to primary dealers, which are firms that trade securities directly with the Fed. This facility was set up in response to the financial crisis and the sale of Bear Stearns, which threatened to destabilize the financial system. The PDCF allowed the Fed to provide liquidity to investment banks and other financial institutions, which helped to restore confidence in the markets. The other facilities listed (Term Auction Facility, ABCP MMMF Liquidity Facility, and Commercial Paper Funding Facility) were also established by the Fed during the financial crisis to provide liquidity to the markets, but they did not specifically target investment banks.

After the 2008 Sale of Investment Bank Bear Stearns, the Fed