Jura The idiot
General
while
American Economics Thread
- Thread starter Bernard
- Start date
Equation
Lieutenant General
Mnuchin is an idiot...period.
Mnuchin is an idiot...period.
It is unbelievable Jura falls for that one! Mnuchin is the secretary of the Treasury! You wouldn't expect him to say anything less. In fact, I'm surprise he's not telling everyone now it's the best time to invest! And this virus is a sign from the Gods of investment to invest in masks, medical supplies, toilet rolls, etc.
Jura The idiot
General
don't troll by posting what I "fall for", by telling me to "cheer up" earlier today
Federal Reserve cuts rates to zero and launches massive $700 billion quantitative easing program
The Federal Reserve, saying "the coronavirus outbreak has harmed communities and disrupted economic activity in many countries, including the United States," cut interest rates to near-zero on Sunday and launched a massive $700 billion quantitative easing program to shelter the economy from the effects of the virus.
Facing highly disrupted financial markets, the Fed also slashed the rate of emergency lending at the discount window for banks by 125 bps to 0.25%, and lengthened the term of loans to 90 days.
The new fed funds rate, used as a benchmark both for short-term lending for financial institutions and as a peg to many consume rates, will now be targeted at 0%-0.25%.
The Fed also cut reserve requirement ratios for thousands of banks to zero. In addition, in a global coordinated move by centrals banks, the Fed said the Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, the Federal Reserve, and the Swiss National Bank took action to enhance dollar liquidity around the world through existing dollar swap arrangements.
The banks lowered the rate on these swap line loans and extended the period for such loans. Fed Chairman Jerome Powell is scheduled to hold a press conference via telephone at 6 pm eastern time. The actions by the Fed appeared to be the largest single day set of moves the bank had ever taken, mirroring in many ways its efforts during the financial crisis that were rolled out over several months. Sunday's move includes multiple programs, rate cuts and QE, but all in a single day.
The quantitative easing will take the form of $500 billion of Treasurys and $200 billion of agency-backed mortgage securities. The Fed said the purchases will begin Monday with a $40 billion installment.
The Fed cut rates from the previous target range of 1% to 1.25% and said it would remain there "until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals."
Cleveland Fed President Loretta Mester was the lone no vote, preferring to set rates at 0.5% to 0.75%, which would have represented a 50 basis point, of half percentage point, reduction.
The Fed added in its statement that it "is prepared to use its full range of tools to support the flow of credit to households and businesses and thereby promote its maximum employment and price stability goals."
It appeared, though it was not entirely clear, that the meeting that took place will replace the regularly scheduled meeting of the Federal Open Market Committee.
The move follows several actions by the Fed over the past two weeks in which it enacted a 50 basis point emergency rate cut and expanded the overnight credit offering, or repo, for the financial system up to $1.5 trillion.
The Federal Reserve, saying "the coronavirus outbreak has harmed communities and disrupted economic activity in many countries, including the United States," cut interest rates to near-zero on Sunday and launched a massive $700 billion quantitative easing program to shelter the economy from the effects of the virus.
Facing highly disrupted financial markets, the Fed also slashed the rate of emergency lending at the discount window for banks by 125 bps to 0.25%, and lengthened the term of loans to 90 days.
The new fed funds rate, used as a benchmark both for short-term lending for financial institutions and as a peg to many consume rates, will now be targeted at 0%-0.25%.
The Fed also cut reserve requirement ratios for thousands of banks to zero. In addition, in a global coordinated move by centrals banks, the Fed said the Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, the Federal Reserve, and the Swiss National Bank took action to enhance dollar liquidity around the world through existing dollar swap arrangements.
The banks lowered the rate on these swap line loans and extended the period for such loans. Fed Chairman Jerome Powell is scheduled to hold a press conference via telephone at 6 pm eastern time. The actions by the Fed appeared to be the largest single day set of moves the bank had ever taken, mirroring in many ways its efforts during the financial crisis that were rolled out over several months. Sunday's move includes multiple programs, rate cuts and QE, but all in a single day.
The quantitative easing will take the form of $500 billion of Treasurys and $200 billion of agency-backed mortgage securities. The Fed said the purchases will begin Monday with a $40 billion installment.
The Fed cut rates from the previous target range of 1% to 1.25% and said it would remain there "until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals."
Cleveland Fed President Loretta Mester was the lone no vote, preferring to set rates at 0.5% to 0.75%, which would have represented a 50 basis point, of half percentage point, reduction.
The Fed added in its statement that it "is prepared to use its full range of tools to support the flow of credit to households and businesses and thereby promote its maximum employment and price stability goals."
It appeared, though it was not entirely clear, that the meeting that took place will replace the regularly scheduled meeting of the Federal Open Market Committee.
The move follows several actions by the Fed over the past two weeks in which it enacted a 50 basis point emergency rate cut and expanded the overnight credit offering, or repo, for the financial system up to $1.5 trillion.
Things must be pretty bad then. The Fed also cut reserve requirement ratios for thousands of banks to zero.
Are we gonna go negative eventually?
There is something going on here. Cutting rates to 0 and announcing QE on a sunday with the regular FOMC meeting just a few days away. I know things are bad but I didn't know things are THAT bad. They must know something that we don't that they can't wait few more days to cut rate and announce QE. I know they are trying to prevent a credit freeze in the markets and the economy. But it doesn't seem to help because the Dow futures is down massively. We live in interesting times indeed.
Honestly nobody would know at this point in time.
We better hope Fed does know what they are doing, both timing and magnitude wise.
They always say " data dependent ", but 3 cuts ago was just plain jumping the gun, was wheeled out as an "insurance", which is opposite of " data dependent".
Fed is not squeaky clean, sudden repo rate spike in last year came to mind.
At least one hike in 2018 was under a lot of questions given the 20/20 hindsight.
So buckle up, hang on tight and enjoy the ride.
We better hope Fed does know what they are doing, both timing and magnitude wise.
They always say " data dependent ", but 3 cuts ago was just plain jumping the gun, was wheeled out as an "insurance", which is opposite of " data dependent".
Fed is not squeaky clean, sudden repo rate spike in last year came to mind.
At least one hike in 2018 was under a lot of questions given the 20/20 hindsight.
So buckle up, hang on tight and enjoy the ride.
In theory, Jerome and his committee are not beholden to any political masters' wishes or whims.
Emphasis is on "theory", in reality what you said seems to be about right.