The Fed Breaks Out the Heavy Artillery

With the furor over American International Group (AIG) bonuses distracting Congress and the Obama Administration, the Federal Reserve thrust itself back to the front lines on Mar. 18 with a trillion-dollar-plus campaign of shock and awe against the deepening recession. At the conclusion of its two-day policy meeting, the independent central bank—which doesn't have to ask anyone for permission to spend money—committed itself to buying enormous quantities of asset-backed securities and debt in order to lower interest rates and revive housing, consumer lending, and small-business loans.

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