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The Early Phases of the Financial Crisis: Reflections on the Lender of Last Resort

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Abstract

This essay discusses the powers and limitations of the Federal Reserve's role as Lender of Last Resort and how it deployed those powers during the financial crisis of 2007-2009. It considers the Fed's authorities and the frameworks that it relied on in utilizing its powers to calm markets in turmoil and to assist specific financial institutions.

Suggested Citation

  • Geithner, Timothy, 2019. "The Early Phases of the Financial Crisis: Reflections on the Lender of Last Resort," Journal of Financial Crises, Yale Program on Financial Stability (YPFS), vol. 1(1), pages 1-38, March.
    • Handle: RePEc:ysm:ypfsfc:1111
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    File URL: https://elischolar.library.yale.edu/cgi/viewcontent.cgi?article=1011&context=journal-of-financial-crises
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    References listed on IDEAS

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    1. Brian Madigan, 2009. "Bagehot's dictum in practice: formulating and implementing policies to combat the financial crisis," Proceedings - Economic Policy Symposium - Jackson Hole, Federal Reserve Bank of Kansas City, pages 169-189.
    2. William R. Cline & Joseph E. Gagnon, 2013. "Lehman Died, Bagehot Lives: Why Did the Fed and Treasury Let a Major Wall Street Bank Fail?," Policy Briefs PB13-21, Peterson Institute for International Economics.
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    More about this item

    Keywords

    Lender of Last Resort; Federal Reserve; Monetary Policy; Financial Crises; 2007; 2009; Treasury; Geithner; Bernanke;
    All these keywords.

    JEL classification:

    • G01 - Financial Economics - - General - - - Financial Crises
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation

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