June 8, 2023

In late 1999, authorities were concerned that Y2K could lead to mass computer outages, and therefore, to ensure market stability, the Fed offered banks access to liquidity via special facilities. What resulted was (in retrospect, through the eyes of us who have lived through years of QE) utterly predictable, but at the time, caught many players unaware (not least the Fed), namely, a massive run-up in speculative stocks.