With federal interest rates already near zero, the Federal Reserve is using an unconventional tool called quantitative easing—buying large assets to inject more money into the economy. "In March 2009, for instance, the Bank of England, the U.K.’s central bank, engaged in quantitative easing by buying U.K. government bonds as well as debt issued by private companies. The means those firms now have more cash on their hands, which in theory makes business lending easier. Quantitative easing may also lower the rates on five- or 10-year bonds. The Federal Reserve undertook a large quantitative easing measure by buying about $1 trillion in long-term Treasury bonds in March 2009."

Read it at MIT News

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