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There’s no inflation when the fed buys corporate bonds or bails out failed corporations. It is just propping up the market. If the fed had given that money dir

by cwhiz 6y ago

There’s no inflation when the fed buys corporate bonds or bails out failed corporations. It is just propping up the market. If the fed had given that money directly to consumers we might have inflation problems. They’ll never do that. Socialism only exists in America for corporations.

mrep 6y ago
The fed cannot give directly to consumers. However, congress can and did give directly to consumers with the 1200 check, the 600 a week increase in unemployment, and indirectly by funding payroll for small businesses and the airlines. However, that created a whole lot of debt which the fed has been predominantly buying with their printed dollars as you can see in their balance sheet [0]. [0]: https://www.federalreserve.gov/releases/h41/current/h41.htm https://www.federalreserve.gov/releases/h41/current/h41.htm
- criddell 6y ago
  When there's no worries about inflation, is there a downside to the fed doing this?
- cwhiz 6y ago
  The fed is legally barred from directly lending to businesses or households except for in an emergency where they can do virtually anything they want. Congress authorizes $300 billion in direct checks to consumers. The remaining $2.7 trillion went to businesses. The fed has separately printed several trillion dollars lending to businesses, buying corporate bonds, and other actions. What should the stock market be at right now? Who knows. We have no way to know because we won’t allow the market to tank.
  - mrep 6y ago
    > The remaining $2.7 trillion went to businesses. Nope (and the total bill was 2.1 trillion not 3 trillion): https://en.wikipedia.org/wiki/Coronavirus_Aid,_Relief,_and_Economic_Security_Act https://en.wikipedia.org/wiki/Coronavirus_Aid,_Relief,_and_E... > The fed has separately printed several trillion dollars lending to businesses, buying corporate bonds, and other actions. Also not even remotely true, they are predominately buying U.S. Treasury securities and Mortgage-backed securities: https://www.federalreserve.gov/releases/h41/current/h41.htm https://www.federalreserve.gov/releases/h41/current/h41.htm Got any sources to back up your claims?
MiroF 6y ago
> There’s no inflation when the fed buys corporate bonds or bails out failed corporations. It is just propping up the market. Respectfully, please read an economics textbook.
- cwhiz 6y ago
  Trillions printed, inflation flat. Please tell me more.
  - MiroF 6y ago
    You're reasoning from a price change. Inflation is flat/decreasing only slightly because of the "printing", otherwise it would be sharply downwards. The fed is engaging in aggressive monetary policy to prevent deflation. The suggestion that buying corporate bonds (while holding everything else constant) is not inflationary is just not right. You can hold on to your mistaken beliefs, but just know that if you do so, it is in willing ignorance of the facts.

by cwhiz 6y ago

mrep 6y ago

The fed cannot give directly to consumers. However, congress can and did give directly to consumers with the 1200 check, the 600 a week increase in unemployment, and indirectly by funding payroll for small businesses and the airlines. However, that created a whole lot of debt which the fed has been predominantly buying with their printed dollars as you can see in their balance sheet [0]. [0]: https://www.federalreserve.gov/releases/h41/current/h41.htm https://www.federalreserve.gov/releases/h41/current/h41.htm

criddell 6y ago
When there's no worries about inflation, is there a downside to the fed doing this?
cwhiz 6y ago
The fed is legally barred from directly lending to businesses or households except for in an emergency where they can do virtually anything they want. Congress authorizes $300 billion in direct checks to consumers. The remaining $2.7 trillion went to businesses. The fed has separately printed several trillion dollars lending to businesses, buying corporate bonds, and other actions. What should the stock market be at right now? Who knows. We have no way to know because we won’t allow the market to tank.
- mrep 6y ago
  > The remaining $2.7 trillion went to businesses. Nope (and the total bill was 2.1 trillion not 3 trillion): https://en.wikipedia.org/wiki/Coronavirus_Aid,_Relief,_and_Economic_Security_Act https://en.wikipedia.org/wiki/Coronavirus_Aid,_Relief,_and_E... > The fed has separately printed several trillion dollars lending to businesses, buying corporate bonds, and other actions. Also not even remotely true, they are predominately buying U.S. Treasury securities and Mortgage-backed securities: https://www.federalreserve.gov/releases/h41/current/h41.htm https://www.federalreserve.gov/releases/h41/current/h41.htm Got any sources to back up your claims?

MiroF 6y ago

> There’s no inflation when the fed buys corporate bonds or bails out failed corporations. It is just propping up the market. Respectfully, please read an economics textbook.

cwhiz 6y ago
Trillions printed, inflation flat. Please tell me more.
- MiroF 6y ago
  You're reasoning from a price change. Inflation is flat/decreasing only slightly because of the "printing", otherwise it would be sharply downwards. The fed is engaging in aggressive monetary policy to prevent deflation. The suggestion that buying corporate bonds (while holding everything else constant) is not inflationary is just not right. You can hold on to your mistaken beliefs, but just know that if you do so, it is in willing ignorance of the facts.