The Evolution of the Federal Reserve Swap Lines since 1962

Michael Bordo, Owen Humpage and Anna Schwartz

No 1414, Working Papers (Old Series) from Federal Reserve Bank of Cleveland

Abstract: In this paper, we describe the evolution of the Federal Reserve?s swap lines from their inception in 1962 as a mechanism to forestall claims on US gold reserves under Bretton Woods to their use during the Great Recession as a means of extending emergency dollar liquidity. We describe the Federal Reserve?s successes and failures. We argue that swaps calm crisis situations by both supplementing foreign countries? dollar reserves and by signaling central-bank cooperation. We show how swaps exposed the Federal Reserve to conditionality and raised fears that they bypassed the Congressional appropriations process.

Keywords: Swap lines; Federal Reserve; Bretton Woods; Intervention; Mexico; Lender of last resort (search for similar items in EconPapers)
JEL-codes: F3 N2 (search for similar items in EconPapers)
Pages: 32 pages
Date: 2014-10-02
New Economics Papers: this item is included in nep-cba, nep-his and nep-mon
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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Related works:
Journal Article: The Evolution of the Federal Reserve Swap Lines since 1962 (2015)
Working Paper: The Evolution of the Federal Reserve Swap Lines since 1962 (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedcwp:1414

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DOI: 10.26509/frbc-wp-201414

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