3 ms·

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 unemploymen

by 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?

3 ms·

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 unemploymen

by mrep 6y ago

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?