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how powerful is the fed?

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how powerful is the fed?

it is march 2009. the american economy is rapidly collapsing. the previous month, payroll jobs had dropped by a staggering 650,000. the grim outlook stokes gallows humor. federal reserve chairman ben bernanke receives a call from a top fed official.“do you want some good news?” the official asks.“please,” bernanke responds. “call somebody else.”in this desperate climate, the fed unleashed a massive program — the ultimate cost approached $4 trillion — to buy u.s. treasury securities and mortgage bonds. the aim was to ignite a recovery by driving down interest rates. the gamble worked. by midyear, the economy hit bottom. its subsequent growth reduced the monthly unemployment rate from a peak of 10 percent to nearly 4 percent by 2017.the success of the bond-buying program — ...