Financial Crisis and Economic Downturn‪.‬

I. INTRODUCTION In the current economic downturn the Federal Reserve and federal government have chosen different methods to stimulate the economy. The main factor is the choice of financing each have following to implement their stimulus program. The Federal Reserve had opted to use quantitative easing, in increasing money the Federal Reserve hope to ease credit and investments by the commercial banks therefore improving the flow of money in the economy. The federal government has opted to use US Treasuries in paying for huge fiscal stimulus programs to stimulate the economy. Both are feasible for the objective each is trying to pursue; however both have long term disadvantages on the economy.