Question of the Day

What portion of the $3.5 trillion created by the Fed for quantitative easing has been loaned by banks to the public (in keeping with the main stated purpose of the policy)?

Correct Answer

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Banks have loaned roughly 23% of this money to the public. The banks have placed the rest of this money on deposit with the Fed, and the Fed has paid the banks interest on these deposits for the first time in U.S. history.

DocumentationQE Winners & Losers Banks' Excess Deposits at the Fed