The TSLF — $200 billion worth of swaps from the Fed to primary dealers and banks — is the first time since the 1960s that the Federal Reserve has tried this scheme. In the 1960s, the Fed conducted “Operation Twist” – a very similar operation. According to research published by the Fed itself, Operation Twist did not work.
According to the same Fed research, it won’t work now. Excerpt from Fed’s research paper: “From this episode [Operation Twist], many policymakers and analysts should have recognized, according to Benjamin H. Beckhart, that “long-term interest rates cannot be substantially reduced by money market gimmicks.” It is doubtful, therefore, that the Fed would be more successful today than it was 30 years ago in attempting to twist the yield curve. <snip> ‘A lasting decline will be achieved only if people gain confidence in the long-term purchasing power of the dollar.'” Read the research→ operationtwist.pdf