Question

How did the federal reserve apply lessons learned from the great crash to the crash of 1987

Answer 1

The correct answer to this open question is the following.

The Federal Reserve applies lessons learned from the great crash to the crash of 1987 in that after the stock market crash of October 1987, the Fed -as is commonly known- decided to lend money freely to the banks in order to have funds and borrow money. The Fed tried to prevent the chaos that could have followed and avoided a harder hit on the United States economy. Although criticized by some and supported by others, that was the decision that Alan Greenspan -Chairman of the Fed- made to have liquidity and be ready to rescue the financial system in case of future issues. These kinds of lessons are the ones that the Fed still applies, as the Central Bank of the United States.