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Fed to inject $1.5T to prevent ‘unusual disruptions’ in markets

cnbc.com

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Re: Fed to inject $1.5T to prevent ‘unusual disruptions’ in markets

#131

Post by mamon »

ipnon wrote: post #59
asickness231 wrote: post #35

"inject 1.5t" by that do they mean a 1.5t panic bailout for wall street? how can we find 1.5t in the budget but no money for universal healthcare, student loan forgiveness, ubi etc. The markets wouldn't be so important if there were a safety net.

The Fed isn't printing 1.5 trillion greenbacks and handing out fat sacks on Wall St. They are providing short-term loans to increase the amount of money in circulation (liquidity). The intent is to increase the total amount of trading occurring so that the market can return to equilibrium sooner than later. The Fed wants to prevent firms from not making trades solely for lack of liquidity in the market. edit: "from m…

>> They are providing short-term loans

If I want to give my friend a loan, I need to earn that money first by working hard. FED does not conduct any profitable activity that would earn them any money, they DO PRINT that money from thin air.

Re: Fed to inject $1.5T to prevent ‘unusual disruptions’ in markets

#132

Post by adventured »

Reedx wrote: post #117
chrisco255 wrote: post #107

Earlier quoted context omitted.

This disease didn't exist 4 months ago and you're calling it a scandal that they can't process billions of tests in that short time frame? It's also not enough to be tested just once as there have been many false negatives. Scaling that up is an immense challenge. It was also exacerbated by the fact that China wouldn't allow our researchers into the country to study the disease. Meanwhile they've already reached stag…

South Korea has been running 10k tests per day since February. The US has run less than 10k in total . That is a colossal failure.

> The US has run less than 10k total. That is a colossal failure.

Question claim in fact, although it is persistently being repeated everywhere constantly, for propaganda purposes. Three of the major private lab companies indicate they'll be at a 10,000 combined per day test capacity before the week is out.

The US doesn't know how many tests have been run in total nationally. A large volume of tests have been distributed to hospitals and private labs around the US, the majority of which do not report their numbers back to a central authority (such as the CDC). That's a failure of centralized reporting and organization, due to the US having dozens of separate healthcare systems which the Feds do not control.

Re: Fed to inject $1.5T to prevent ‘unusual disruptions’ in markets

#133

Post by nine_zeros »

jacquesm wrote: post #91

That worked for about 45 minutes and then the market dropped right back down again. Incredible. At this rate there won't be enough liquidity to cover these sell-offs if they continue. I don't think that's ever happened before.

This isn't and will never be a liquidity problem. This is a real crises. Economic activity is going down to 1980s levels

Re: Fed to inject $1.5T to prevent ‘unusual disruptions’ in markets

#134

Post by daxfohl »

chasd00 wrote: post #103
daxfohl wrote: post #57

Earlier quoted context omitted.

No idea how you get downvoted. Market has already sold off the gains from the stimulus. Lasted a few minutes. Not very well spent money IMO.

it's not a stimulus it's loans to prevent a liquidity crisis and the credit markets from freezing up. It was the credit markets in 2008 that nearly killed the world economy. They dwarf the stock market.

Still, given the market was like Meh, seems like nobody thought it was very useful.

That said, yeah I see how you are right. Lots of businesses run month to month. When they run out of cash they go bankrupt. Once enough companies do so, the economy takes much longer to recover.

Re: Fed to inject $1.5T to prevent ‘unusual disruptions’ in markets

#135

Post by dageshi »

tmpynews wrote: post #45

I honestly don't think this is going to work. Markets and investors are notoriously greedy and have a very short memory. This infusion will lift the market for a day (if at all) and institutions will make money and the next day the news cycle will take over and the selling will continue. We are in the early phases of negative news so not sure effective this will be.

I doubt they expect it to "lift" the market in a meaningful way, they're just trying to smooth out some of the volatility. Having lived through the 2007/8 financial crash, yeah... market declines happen, not the end of the world when they do.

Re: Fed to inject $1.5T to prevent ‘unusual disruptions’ in markets

#136

Post by kylebenzle »

hef19898 wrote: post #112
gdubs wrote: post #13

As the joke goes, a trillion here a trillion there and pretty soon you're talking about some real money! But in seriousness, the next week is a critical time in the world. I remember sitting in an airport when news of Lehman Brothers collapse was flashing on the TV screens. I'm reminded of that time. We learned later about how Hank Paulson got down on one knee and begged Nancy Pelosi to go along with is plan to save…

> The lack of testing will maybe turn out to be one of the biggest scandals of my lifetime. If I had to choose one thing that should change right now, it is this. Aggressive testing of everyone, starting with contact persons, persons travelling from high risk areas and then basically everyone. Would allow a much better understanding of the situation and make any measures way more effective. Other than that, the measu…

What is the argument against testing everyone? If it lasts 2 days on surfaces, it seems like a matter of when not if you get it.

Best we can do is "flatten the curve" by isolating people as much as possible. Realistically, all the hand washing and testing does next to nothing in terms of modifying behaviour.

Re: Fed to inject $1.5T to prevent ‘unusual disruptions’ in markets

#137

Post by ThomPete »

tw04 wrote: post #69
gdubs wrote: post #13

As the joke goes, a trillion here a trillion there and pretty soon you're talking about some real money! But in seriousness, the next week is a critical time in the world. I remember sitting in an airport when news of Lehman Brothers collapse was flashing on the TV screens. I'm reminded of that time. We learned later about how Hank Paulson got down on one knee and begged Nancy Pelosi to go along with is plan to save…

>But if there were ever a time for us not to be partisan and tribal, it's now. You say that like both parties are trying to deny testing and are refusing to provide the social safety net for workers to stay home when they're sick. This is very much not a "both sides" discussion. This is: the GOP needs to stop trying to pretend like nothing is wrong and actually DO SOMETHING to prevent this from becoming an even bigge…

If you actually listen to the hearing today you will realize that this is a systemic issue with the US healthcare system not something any politician can do much about.

The US is not built that way the CDC can't just fix it. That's the power and weakness of our system compared to other countries.

Here the leaders of CDC explains the problem in a nutshell.

https://www.youtube.com/watch?v=PxC9Q99il1Q

Re: Fed to inject $1.5T to prevent ‘unusual disruptions’ in markets

#138

Post by paulmd »

tw04 wrote: post #69
gdubs wrote: post #13

As the joke goes, a trillion here a trillion there and pretty soon you're talking about some real money! But in seriousness, the next week is a critical time in the world. I remember sitting in an airport when news of Lehman Brothers collapse was flashing on the TV screens. I'm reminded of that time. We learned later about how Hank Paulson got down on one knee and begged Nancy Pelosi to go along with is plan to save…

>But if there were ever a time for us not to be partisan and tribal, it's now. You say that like both parties are trying to deny testing and are refusing to provide the social safety net for workers to stay home when they're sick. This is very much not a "both sides" discussion. This is: the GOP needs to stop trying to pretend like nothing is wrong and actually DO SOMETHING to prevent this from becoming an even bigge…

Also:

https://thehill.com/homenews/administration/486559-trump-fak...

https://theweek.com/speedreads/901405/seattle-lab-uncovered-...

https://www.vanityfair.com/news/2020/03/anthony-fauci-donald...

https://thehill.com/homenews/house/487014-trump-officials-cu...

Yes, the administration bears a huge amount of responsibility for sandbagging and obstructing the initial response, mis-informing the public, ignoring their own subject experts, etc.

Fresh Air did a great long-form report today summarizing the ways the administration has obstructed and worsened the crisis. No transcript yet but it's worth a listen.

https://www.npr.org/2020/03/12/814881355/white-house-knew-co...

(<3 Terry Gross, she's a wonderful interviewer who is fantastic at asking insightful and probing questions while being incredibly kind and gentle. Probably the single most informative show on the air, for whatever topic she covers.)

Re: Fed to inject $1.5T to prevent ‘unusual disruptions’ in markets

#139

Post by kylebenzle »

mamon wrote: post #131
ipnon wrote: post #59

Earlier quoted context omitted.

The Fed isn't printing 1.5 trillion greenbacks and handing out fat sacks on Wall St. They are providing short-term loans to increase the amount of money in circulation (liquidity). The intent is to increase the total amount of trading occurring so that the market can return to equilibrium sooner than later. The Fed wants to prevent firms from not making trades solely for lack of liquidity in the market. edit: "from m…

>> They are providing short-term loans If I want to give my friend a loan, I need to earn that money first by working hard. FED does not conduct any profitable activity that would earn them any money, they DO PRINT that money from thin air.

Why do people keep telling the lie that the FED "does not print money"? As you say, these "loans" are the FED printing $1.5t, no other way to look at it.

Re: Fed to inject $1.5T to prevent ‘unusual disruptions’ in markets

#140

Post by paulmd »

tic_tac wrote: post #108
tw04 wrote: post #69

Earlier quoted context omitted.

>But if there were ever a time for us not to be partisan and tribal, it's now. You say that like both parties are trying to deny testing and are refusing to provide the social safety net for workers to stay home when they're sick. This is very much not a "both sides" discussion. This is: the GOP needs to stop trying to pretend like nothing is wrong and actually DO SOMETHING to prevent this from becoming an even bigge…

You can't just conjure the necessary tests up from nothing. Japan has also had problems with testing. No one is trying to "deny testing". It is a work in progress and is indeed ramping up.

The WHO actually had tests that worked. CDC refused those and chose to independently redevelop their own. Then those didn't work, they still kept trying, while also blocking states from using their own tests that also worked.

https://www.propublica.org/article/cdc-coronavirus-covid-19-...

The states with "local outbreaks" (NY, CA, WA) are the ones that told the CDC to get bent and did it anyway. It's everywhere, the states with low case numbers just aren't testing for it.

https://theweek.com/speedreads/901405/seattle-lab-uncovered-...

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