Successes and Drawbacks of the Federal Reserve and the Impact on Financial Markets

  • Muhammad Mustafa RASHID University of Detroit Mercy, United States of America


The purpose of this paper is to provide an outline of the successes and draw-backs of the Federal Reserve and the consequent impact on financial markets. A review of the relevant literature from Hubbard (2008) and Dowd and Hutchinson (2010) will provide insights into the success and failures of the Federal Reserve and the impact on financial markets. Further insights will be drawn from; Gorton and Metrick (2013) and their interpretation of the Federal Reserve’s actions since its formation, Romer and Romer (2013) on the pessimism of monetary policy and Dyugen-Bump (et al. 2013) on their assessment of the effectiveness of emergency liquidity measures.


[1] Duygan-Bump, B., Parkinson, P., Rosengren, E., Suarez, G.A., Willen, P. 2013. How Effective Were the Federal Reserve Emergency Liquidity Facilities? Evidence from the Asset-Backed Commercial Paper Money Market Mutual Fund Liquidity Facility. Journal of Finance, 68: 715-737.
[2] Dowd, K. and Hutchinson, M. 2010. Alchemist of Loss. West Sussex, UK: John Wiley & Sons Ltd., ISBN-10: 0470689153, 432 pp.
[3] Gorton, G. and Metrick, A. 2013. The Federal Reserve and Panic Prevention: The Roles of Financial Regulation and Lender of Last Resort. The Journal of Economic Perspectives, 27 (4): 45-64. DOI: org/10.1257/jep.27.4.45
[4] Hubbard, R.G. 2008. Money, the Financial System, and the Economy 6th Edition. Boston, MA, Pearson Education, Inc. ISBN-10: 0321426703, 768 pp.
[5] Romer, C.D, Romer, D.H. 2013. The Most Dangerous Idea in Federal Reserve History: Monetary Policy Doesn't Matter. American Economic Review, 103 (3): 55-60.
[6] Yellen, J. 2018. What the Fed Has Learned Since the Financial Crisis interviewed March. Available at:
How to Cite
RASHID, Muhammad Mustafa. Successes and Drawbacks of the Federal Reserve and the Impact on Financial Markets. Journal of Advanced Studies in Finance, [S.l.], v. 9, n. 2, p. 56-59, jan. 2019. ISSN 2068-8393. Available at: <>. Date accessed: 03 mar. 2024. doi:
Journal of Advanced Studies in Finance