The Federal Reserve, the central bank of the US, increased its total assets from $4.17 trillion in January 2020 to $8.33 trillion as of August 2021, in an effort to stabilize the economy since the COVID-19 pandemic.
This is the second time in history that the Federal Reserve took extraordinary steps to stabilize the financial markets and stave off economic disaster. The first time was during the Great Recession. The Fed now owns $6 trillion more in assets than it did during the peak of its response to the 2008 recession.
This powerful independent agency plays a vital role in the US economy, in both good times and bad. Understanding the way it works is essential to understanding its policy decisions.
