1/7/2014 Timeline: A short history of QE and the market - Marketwatch

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The financial markets are
not working as we'd like
them to work ... and this
is an effort to address
that situation.
Treasury Secretary Henry
Paulson
November 25, 2008
Fed unveils $800 billion plan to bolster lending, housing
With financial markets still not working smoothly two months after almost shutting down, the
Federal Reserve unveils steps aimed at lowering borrowing costs for consumers and home
buyers.
The central bank announces plans to purchase up to $100 billion in direct debt of Fannie Mae,
Freddie Mac and the Federal Home Loan Banks, along with up to $500 billion of mortgage-backed
securities backed by Fannie, Freddie and Ginnie Mae (the government-sponsored enterprises,
also known as GSEs).
Fed move aims to normalize rate spreads for asset-backed securities
Mortgage rates drop below 6%
Timeline: The fall of Lehman Brothers
Getty Images
Ben Bernanke
March 18, 2009
Federal Reserve to buy $300 billion in longer-term
Treasury bonds
The Federal Reserve says it will buy $300 billion in longer-term Treasury bonds to
help arrest a deepening slide in the U.S. economy, a surprise move that send stocks
soaring and triggers violent moves in other markets. The Federal Reserve's move
signals it will boost the size of its balance sheet to more than $4 trillion.
Following the Fed decision, gold futures and U.S. stocks rally, while the dollar
plunges against other major currencies. In the bond market, Treasury prices soar,
sending yields plummeting by the largest amount since 1987.
Fed to buy $300 billion in long-term Treasurys
Treasury yields drop most since 1987 as Fed commits to buy
Market meltdown refutes 'efficient markets' theory

A short history of QE and the market
Since November 2008, the Federal Reserve has gone through three rounds of quantitative easing to help stimulate the economy. Whether the efforts
have helped for the long-term has yet to be seen, but many expect the Fed's actions to start tapering off later this year. Here's a look at key events in
the Federal Reserve's bond-buying efforts, as well as the market's reaction.
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1/7/2014 Timeline: A short history of QE and the market - Marketwatch
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News Hub: Fed Launches $600 Billion Stimulus Plan
November 3, 2010
Federal Reserve to buy $600 billion in
bonds
The Federal Reserve pledges to start a controversial new
$600 billion bond-buying spree to rescue the economy from its
current doldrums. The FOMC says it will buy up to $600 billion
in long-term Treasurys until the end of June 2011, including
about $75 billion this month.
This is the second time the Fed engages in quantitative
easing, as it snapped up $1.7 trillion in mostly housing-related
assets between December 2008 and March 2010.
Fed to buy $600 billion in bonds
U.S. stocks lifted after Fed moves on bond buys
Text of FOMC statement
Analysis of the Fed's Rate Decision
September 21, 2011
Federal Reserve moves to lower interest
rates on consumer loans with a $400
billion debt-swap program
In a statement, the Fed says it will buy $400 billion of Treasury
securities in the 6- to 30-year range and sell an equal amount
of maturities of 3 years or less. The purchases to be completed
by the end of June 2012. The Fed also announces a new plan
to purchase agency mortgage-backed securities with proceeds
of maturing securities. The Dow Jones Industrial Average
closes down 283.82 points, or 2.5%, at 11,124.84.
Fed decides on $400 billion bond swap
Text of Federal Reserve rate decision
U.S. stocks drop hard after Fed move
Republicans warn Fed not to ease again
We still do have
considerable scope to do
more and we are
prepared to do more.
Fed Chairman Ben Bernanke
June 20, 2012
Fed extends 'Operation Twist'
The Fed says it will extend its holdings of long-term government bonds by $267 billion in another
effort to bring down borrowing costs.
Fed continues 'Twist'; Bernanke hints at more
Getty Images
Fed Chairman Ben Bernanke
September 13, 2012
Fed to launch QE3 by buying mortgage securities
By an 11-to-1 vote, the Federal Reserve decides to launch a third round of open-
ended bond purchases so-called QE3 saying it will buy $40 billion of agency
mortgage-backed securities per month.
The Fed also says it will keep its so-called Operation Twist in place, which consists
of swapping short-dated securities for longer-term securities, as well as reinvesting
the proceeds of maturing securities.
Fed to launch QE3 of $40 billion MBS each month
Text of Fed statement on QE3
Commentary: QE3 is a bold change in tactics by Bernanke & Co.
1/7/2014 Timeline: A short history of QE and the market - Marketwatch
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Reuters
Federal Reserve Chairman Ben Bernanke speaks during a news
conference in Washington on December 12, 2012.
December 12, 2012
Fed to buy more bonds as it sets jobless target
The Federal Reserve announces a fresh bond-buying program worth $45 billion per
month of longer-term Treasurys in another effort to reduce what the central bank
calls an "elevated" unemployment rate.
Without the action, the Fed purchases would have been reduced at year-end when
an existing program to swap short-term debt for longer-term Treasurys is set to
expire.
Fed sets jobless, inflation targets; to buy bonds
Live blog of Bernanke presser
Text of Fed's announcement
January 14, 2013
Bernanke downplays inflation risk of QE3
Federal Reserve Chairman Ben Bernanke plays down the fears of some more hawkish central bankers and investors that the Fed's aggressive
bond-buying program will lead to higher inflation. "I don't believe significant inflation is going to be the result of any of this," Bernanke says in a
speech at the University of Michigan.
The taper could begin later this year, Bernanke says
Fed hawks get their day in the sun
Bernanke Appears Before Congress
May 22, 2013
Bernanke tells Congress 'step down' in
QE could come soon
Federal Reserve Chairman Ben Bernanke tells Congress that
the U.S. central bank could slow down its asset purchase
program in the next few months. U.S. stocks slide with the Dow
Jones Industrial Average dropping 80.41 points, or 0.5%, to
15,307.17.
Bernanke: 'Step down' in QE could come soon
Live blog of Bernanke's testimony to Congress
Gold ends lower after Bernanke's mixed QE signals
Poll: When will the Fed start tapering bond purchases?
He's already stayed a lot
longer than he wanted or
he was supposed to.
President Obama in an
interview with Charlie Rose
June 19, 2013
Bernanke says the central bank may scale back its bond
purchases this year, depending on the economic outlook
Ben Bernanke says the Fed could begin to taper its purchase of bonds later this year, if the
economy continues to improve as Fed officials expect. And the Fed could end the bond-buying
completely sometime in the middle of next year, if everything goes well. The markets promptly sell
off, as they did a few weeks ago when Bernanke first mentioned the possibility of a reduction in the
$85 billion pace of bond purchases.
In an interview aired the day prior, President Barack Obama tells Charlie Rose that "Ben Bernanke's a little bit like Bob Mueller, the head of the
FBI, where he's already stayed a lot longer than he wanted or he was supposed to." Rumors about Bernanke's career plans had already been
swirling, but the President's statement forces Fed watchers to start seriously considering a post-Bernanke era. Bernanke has served as chairman
of the Fed since 2006, with his second term set to end on Jan. 31, 2014.
The taper could begin later this year, Bernanke says
U.S. stocks sink, yields rise after Fed move
Fed tapering could begin later this year
Obama's 'firing' of Fed chief Bernanke strikes a nerve
Poll: Who should replace Ben Bernanke as Fed chief?
1/7/2014 Timeline: A short history of QE and the market - Marketwatch
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By Brian Aguilar. Interactive by Sarah Squire.
Reuters
Federal Reserve Board Chairman Ben Bernanke in July.
September 18, 2013
Fed decides not to taper
The Federal Reserve holds its asset purchase program steady, putting off any
decision for tapering until later in the year in a decision that surprises markets. By a
vote of 9-to-1, the Fed holds its bond-buying program at $85 billion, citing tighter
financial conditions. S&P 500, Dow rise to record closing highs.
In surprise, Fed decides not to taper
Live blog of Fed press conference and decision
Read the full FOMC statement
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