The First Time the Fed Bought GSE Debt

Renee Courtois Haltom and Robert Sharp

Richmond Fed Economic Brief, 2014, issue Apr

Abstract: In 1966, Congress gave the Federal Reserve authority to purchase the debt of agencies guaranteed or owned by the federal government. This same authority has enabled the Fed's purchases of mortgage-backed securities (MBS) and debt of government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac since 2008 in support of the housing market. In a little-known episode, the Fed shied away from exercising this authority in the 1960s but eventually conceded under political pressure and perceived threats to its independence.

Keywords: Housing; Monetary History (search for similar items in EconPapers)
Date: 2014
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