Fed to Launch New Regulation to Curb Emergency Corporate Lending

November 30, 2015 Share Print 0

The Federal Reserve said Monday it will adopt new regulations on emergency corporate lending.
Under the new rules, the Fed would prohibit emergency loans to individual companies.

The new regulations also say emergency loans must be made at a penalty rate and also prohibit lending to insolvent firms.

Fed Chair Janet Yellen said the Fed can now only offer broad-based emergency credit.

She also said that, under the new regulations, the central bank would not have been able to bail out Bear Stearns or AIG in 2008.

via CNBC

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Alfonso Esparza

Senior Currency Analyst at Market Pulse

Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.