In an editorial in the Wall Street Journal on July 21, Federal Reserve chairman Ben Bernanke wrote that the central bank has a number of tools it can use to wind down its emergency lending and monetary easing policies.

Chief among them is the ability to pay interest on banks’ excess reserves. It can also conduct reverse repurchase agreements and outright sales of securities to reduce those reserves.

Bernanke wrote that most of the Fed’s emergency lending facilities were winding themselves down naturally as cheaper sources of funding have become available in the private markets.

Bernanke made the same points in his Humphrey-Hawkins biannual report to Congress the same day.

• Bernanke editorial
• Humphrey-Hawkins testimony 

22 Jun 2009 -

Give and take

16 Dec 2008 -

Turning Japanese

2 Dec 2008 -

The easing way out