See: Term Asset-Backed Securities Loan Facility - TALF.
Prior to 2007, everyone thought they had a pretty good handle on how the economy worked. People were conversant with terms like "interest rates" and "monetary policy." Then markets started melting down as part of the financial crisis of 2007-2008, and suddenly people were inundated by all sorts of terms they didn't even know existed. ABS. MBS. Credit swaps.
As it turns out, the only way to combat problems with esoteric money problems was to create esoteric monetary solutions. So a bunch of nerds at various levels of government launched a series of programs to save the day. This included the Term Auction Facility.
TAF was meant to unfreeze lending markets, especially for short-maturity debt. The Fed auctioned 28-day loans at first, later expanding to 84-day loans. Under the program, the Fed accepted a wider list of collateral, and gave out funds to a wider group of recipients than it normally did under typical operations. The goal was to keep funds flowing through the economy. A little like how CPR keeps the blood going in someone whose heart has stopped beating. Just keep things flowing...until they can get those paddle thingies warmed up.
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Finance: What is Term To Maturity?12 Views
finance a la shmoop what is term to maturity alright people well it's kind
of a lifecycle of a bond like a bond is issued or sold it has an assay a 15 year [Bond timeline appears]
duration somebody's written that money for 15 years its term to maturity when
it first was issued was 15 years but if you bought that bond nine years into it
some you know maturation process when all the hairs growing in funny places [Hairs grow out of bond]
then at that point it would have six years current maturity well what goes on
between these years interest payments and then eventually at the very end the
issuer pays back the principal to the investor who bought the bond and [Money transfers from issuer to investor]
everyone goes away happy-ish well bonds carry gradations in short medium and
long term terms to maturity like short term generally is considered one to five [Different types of bond appear]
years mid term medium term and something like that is like five to a dozen years
and long term is like up to you know thirty or even a hundred years after
that dozen or so no hard lines here they're all dotted and yeah Disney [Man discussing bonds at DisneyLand]
actually sold a hundred year bonds at one point and they are of course the
happiest bonds on earth [Disney bonds appear]