CBO report praises Fed's fair-value subsidy program

05/25/2010 | CNNMoney/Fortune

The Congressional Budget Office released a report Monday that gave high marks to a Federal Reserve program that supported the financial sector. The report said the Fed had assumed just $21 billion in risks when it bought stakes in troubled financial companies, well below initial estimates of $189 billion. "In CBO's judgment, if the Federal Reserve had not strategically provided credit and enhanced liquidity, the financial crisis probably would have been deeper and more protracted and the damage to the rest of the economy more severe," said CBO Director Douglas Elmendorf.

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