The Term Auction Facility (TAF) is a temporary program managed by the United States Federal Reserve designed to "address elevated pressures in short-term funding markets." Under the program the Fed auctions collateralized loans with terms of 28 and 84 days to depository institutions that are "in generally sound financial condition" and "are expected to remain so over the terms of TAF loans." Eligible collateral is the same as that accepted for discount window loans and includes a wide range of financial assets. The program was instituted in December 2007 in response to problems associated with the subprime mortgage crisis and was motivated by a desire to address a widening spread between interest rates on overnight and term (longer than overnight) interbank lending, indicating a retreat from risk-taking by banks. The action was in coordination with simultaneous and similar initiatives undertaken by the Bank of Canada, the Bank of England, the European Central Bank and the Swiss National Bank.
Read more about Term Auction Facility: Credit Crunch, Creation of Facility, References
Famous quotes containing the words term, auction and/or facility:
“The term preschooler signals another change in our expectations of children. While toddler refers to physical development, preschooler refers to a social and intellectual activity: going to school. That shift in emphasis is tremendously important, for it is at this age that we think of children as social creatures who can begin to solve problems.”
—Lawrence Kutner (20th century)
“The white American man makes the white American woman maybe not superfluous but just a little kind of decoration. Not really important to turning around the wheels of the state. Well the black American woman has never been able to feel that way. No black American man at any time in our history in the United States has been able to feel that he didn’t need that black woman right against him, shoulder to shoulder—in that cotton field, on the auction block, in the ghetto, wherever.”
—Maya Angelou (b. 1928)
“Virtue rejects facility to be her companion.... She requires a craggy, rough and thorny way.”
—Michel de Montaigne (1533–1592)