Question: Why did the Fed decide against implementing negative interest rates in the financial crisis of 2 0 0 7 - 2 0 0 8 ?
Why did the Fed decide against implementing negative interest rates in the financial crisis of They were afraid negative rates would pump too many lendable funds into the banking system. They were afraid negative rates would discourage spending. The Fed does not have the ability to create negative interest rates. There were no economic arguments in support of negative rates.
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