2009a). "Market and Public Liquidity

As the record of Fed interventions over the past year, from December 2007 to December 2008, makes abundantly clear a foremost con-cern of monetary authorities in responding to the financial crisis has been to avoid a repeat of the great depression, and especially a repeat of the monetary contraction that Milton Fried-man and Anna Schwartz (1963) have identified as the major cause of the 1930s depression. The Fed has shown tremendous resourcefulness and inventiveness in its liquidity injections, consid-erably widening the collateral eligible under the discount window and the term auction facility, and setting up new programs targeted at pri-mary dealers, the commercial paper market and money market funds. At the same time it has stepped in to offer guarantees on assets held by some financial institutions (e.g. Citigroup) to avoid their bankruptcy (see David Enrich