The Associated Press
The Federal Reserve has taken many unprecedented steps in the past three years to try to boost the economy and counter the effects of a financial crisis that triggered a painful recession. It's kept the short-term interest rate it controls at a record low near zero since December 2008.
And it's bought about $2 trillion in U.S. Treasurys and mortgage-backed securities to try to hold down longer-term rates. That's caused the Fed's portfolio of securities to balloon to nearly $2.9 trillion, from less than $1 trillion in 2007.
Some steps the Fed has taken:
— Dec. 15-16, 2008: The Fed creates a target range for interest rates and cuts its key federal funds rate to between zero and 0.25 percent. That's a record low. The Fed vows to use all the tools it has to rescue the economy from the worst financial crisis and recession since the 1930s.
— Jan. 27-28-2009: The central bank signals it's prepared to buy longer-term Treasuries and expand other programs.
— March 17-18, 2009: The Fed says it will start buying up to $300 billion in government bonds over six months. It also decides to boost purchases of Fannie Mae and Freddie Mac mortgage-backed securities and debt. The actions are aimed at driving down rates on mortgages and other debt.
— Sept. 22-23, 2009: The Fed slows a mortgage-buying program to complete its purchases by March 31, 2010, instead of at the end of 2009.
— Aug. 10, 2010: It decides to use some money generated by its mortgage portfolio to buy government debt, to try to lower rates on mortgages and other loans.
— Aug. 27, 2010: In a speech in Jackson Hole, Wyo., Chairman Ben Bernanke lists several options to boost the economy, including the purchase of additional government bonds.
—Oct. 15, 2010: Bernanke signals the Fed will buy more government bonds to boost the economy, drive down unemployment and protect against deflation.
— Nov. 3, 2010: The Fed announces it will buy $600 billion more in Treasury bonds to try to hold down longer-term rates.
— June 22, 2011: The Fed confirms it will complete its purchases of $600 billion in Treasury bonds by the end of the month. The purchases were intended to drive down rates on mortgages and other debt.
— Aug. 9, 2011: It pledges to keep its benchmark short-term rate at nearly zero until mid-2013. It's the first time the Fed has committed to keeping the rate at that level for a specific period. The pledge reflects its assessment that the economy will remain weak.
— Aug. 26, 2011: Bernanke proposes no new steps to boost the economy. But he signals that Congress should do more to promote hiring and growth, or risk delaying the economy's return to full health. He also says the Fed's September policy meeting will last two days instead of one, prompting speculation that the Fed might take further steps then.
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