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Wrong. Fed did not purchase a single share of HTZ. They hold two ETFs that include Hertz corporate bonds. Not stocks. Bonds. And not new issues.
by throwawaygh 6y ago
Wrong.
Fed did not purchase a single share of HTZ.
They hold two ETFs that include Hertz corporate bonds. Not stocks. Bonds. And not new issues.
- divbzero 6y agoYeah GP has the facts wrong. There has actually been interesting speculation that the Fed will eventually buy stocks similar to the Bank of Japan over the past few decades [1] but the Fed hasn’t done it yet. [1]: https://www.forbes.com/sites/kevincoldiron/2020/07/18/the-fed-is-going-to-buy-stocks/ https://www.forbes.com/sites/kevincoldiron/2020/07/18/the-fe... (Edit: Maybe GP was thinking that bankruptcy could lead to debt converting into equity? But even then the Fed’s holding would be indirect and the bond ETF probably wouldn’t hold onto the equity.)
- jacobwilliamroy 6y agoNah, All these financiers are just getting caught up in semantics trying to ignore the reality of the situation. No the fed doesn't "own" anything, because they haven't "bought" anything. The fact remains that they've spent over a trillion dollars on junk bonds and they are almost singlehandedly financing the entire economy right now.