Fed to boost US economy by $1.15 trillion

On the 19th of March the Fed announced that they are going to pump another $1.15 trillion in the financial system. The news about the decision of the Fed was reported by The Canberra Times. In the article they use different interviews and comments on the subject, made by the Fed and specialists in the area.
The aim of this step is that the US avoids a new Great Depression and by pumping money into the economy, the Fed at least increases the hopes of the people that the country will emerge from its slump.
In the last 2 meetings the Fed disappointed market participants, but this time the chairman, Mr Bernanke, took drastic measures. He said that he is not willing to be responsible for the biggest downturn since the 1930s.
Interest rates are no longer available to improve the economic conditions as they are at their lowest at 0.2%. Therefore, the Fed has to use other methods, hence the input of capital in the economy.
However, Wall Street stocks failed to maintain the upward momentum of the previous session. Some are doubtful that the move of the Fed will ease the financial conditions. After plunging 28% to 12-year lows, the S&P 500 shot back up rapidly, gaining 17% in seven sessions. But stocks slipped at the end of last week.
The Standard & Poor’s 500 Index dropped 1.3 percent to 784.04. The Dow Jones Industrial Average lost 85.78 points, or 1.2 percent, to 7,400.80. JPMorgan, the biggest U.S. bank by market value, fell 8 percent to $24.95. Morgan Stanley declined 13 percent to $21.04 and Goldman Sachs slid 5.7 percent to $99.30 (March 19, Bloomberg).
Experts argue that this is just a temporary drop and the stocks will recover during the following week. Also, with the measures taken by the Fed, people are expecting improving economic conditions in the US.You can see 2 charts attached – the first one for the Dow Jones Industrial Average Index and the second one for the Standard and Poor’s 500. The time period is 10 days.