During the 2008-2009 financial crisis in the United States,the Federal Reserve served as a lender of last resort by providing liquidity to:

Question

Quizplus · Accepted Answer

During the financial crisis, the Federal Reserve provided liquidity to both banks and shadow banks with reliable collateral to prevent them from collapsing and causing a systemic financial meltdown. They did not provide funding to insolvent borrowers, state and local governments, or households underwater on their mortgages.

During the 2008-2009 Financial Crisis in the United States,the Federal