Federal bought good quality securities at lower prices during financial crisis. They also had to bear the cost of losing money on some stocks that lost capitalization due to the crisis.
Financial crisis in the economy refers to increased prices of goods and decrease in the market capitalization due to a decline in the economy. Federal bought securities for long-term during 2008 financial crisis.
The benefit of buying this dip was that federal was able to invest in quality stocks at discounted prices. However, it also lost money in companies which could not survive after the end of the financial crisis.
Hence, the benefits and costs of Federal's purchases during the financial crisis of 2008-09 are as aforementioned.
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