The Fed's $1.5 trillion intervention, explained

The central bank just went big to try to prevent a coronavirus-driven financial crisis

Jerome Powell.
(Image credit: Illustrated | Getty Images)

In the latest sign that even the soberest of American economic policymakers are freaked out by the coronavirus, the Federal Reserve announced on Thursday it's going to drop an extra $1.5 trillion on the financial system. The Fed actually made an emergency cut of 0.5 percentage points to its interest rate target just the other week. But it seems the central bank officials think the economy needs extra cushioning against the blows from the coronavirus outbreak.

But how exactly will this work, in practice? And who will benefit?

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