What is the effective annual rate of 9.6 percent compounded semiannually?

An interest rate of 9.6% compounded semi-annually can be calculated using an example of a principal amount of $1000. If it is actual 9.6% used to calculate the interest after 6 months, then for the first 6 months the interest will be $96 so the principal plus interest will be $1096. For the second 6 months, still using 9.6% then it will be based on $1096 so it will be $105.22. So the total interest amount of $96 + $105.22= $201.22/$1000= 0.201x100=20.1% so compounding if at a good interest rate can grow an investment fairly rapidly.

The federal reserve took an expansionary approach during the crisis. this was done by expanding the money supply and boosting liquidity. this can be seen in the fed's actions of lending to banks, purchasing securities, and lowering the federal funds rate in order to lower overall interest rates. the fed's goal was to increase consumer spending and overall liquidity within the system, and they pursued this by expanding the supply of liquid money.