• Corpus ID: 9162731

Lender of Last Resort: What It Is, Whence It Came, and Why the Fed Isn't It

@article{Humphrey2010LenderOL,
  title={Lender of Last Resort: What It Is, Whence It Came, and Why the Fed Isn't It},
  author={Thomas M. Humphrey},
  journal={Cato Journal},
  year={2010},
  volume={30},
  pages={333-364}
}
It has become commonplace in the current crisis to refer to the Federal Reserve as the economy's lender of last resort (LLR). Typical is the observation of Glenn Hubbard, Hal Scott, and John Thornton (2009) that "Over many decades and especially in this financial crisis, the Fed has used its balance sheet to be a classical lender of last resort." With all due respect to these authors and numerous others holding the same view, their statement is wrong, For while there exists such an entity as… 
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