Wall Street and the Federal Reserve have a long history together. To fight the 2008 global financial crisis, the Fed began buying mortgage bonds and Treasurys to help lower long-term borrowing costs and further stabilize the economy. It returned to this strategy during the Covid-19 pandemic, and Wall Street boomed in 2021. Today, the Fed’s balance sheet stands at over $6.5 trillion. Its liabilities include about $3 trillion in the form of reserves—essentially banks’ deposits at the Fed.