[the_ad id=”50945″]
US Treasury Secretary Steven Mnuchin delivered a message to Main Street as the Federal Reserve announced new measures on Monday to combat the ailing economy and the ongoing free fall on Wall Street. The Dow Jones Industrial Average initially sank 900 points, before rising to 18,888, down 285 points. Meanwhile, Bitcoin surged more than $700 within an hour, topping $6,600, and is currently up 4.5% at $6,314.
In a phone interview with CNBC’s Jim Cramer, Mnuchin is urging small business owners to retain their staff and not lay off workers due to the coronavirus.
Says Mnuchin,
“I would say they shouldn’t lay people off, and I would say that within the next week, we will have a program up and running that small businesses can go into banks easily in a fast-track basis and get that cash flow.”
“We want to make sure that small businesses – this represents about 50% of the private economy – keeps workers employed. So when the president is ready to open up this economy again, and we’ve killed this virus, workers are in place. And it’s no fault of theirs. They’re getting paid.”
[media-net300x250]
While Democrats and Republicans are trying to hammer out a stimulus package for Americans, the Federal Reserve is taking unprecedented action to reverse the economic fallout from the global pandemic. In an announcement on Monday, the Fed has pledged to implement a number of measures to stop the bleeding on Wall Street.
According to Monday’s statement by the Fed,
“The Federal Open Market Committee is taking further actions to support the flow of credit to households and businesses by addressing strains in the markets for Treasury securities and agency mortgage-backed securities. The Federal Reserve will continue to purchase Treasury securities and agency mortgage-backed securities in the amounts needed to support smooth market functioning and effective transmission of monetary policy to broader financial conditions.”
Chris Rupkey, chief financial economist at MUFG Union Bank, writes,
“Fed policy is shifting into a higher gear to try to help support the economy which looks like it is in freefall at the moment. The central bank is shifting from being not just the lender of last resort, but now it is the buyer of last resort. Don’t ask how much they will buy, this is truly QE infinity.”
Citing hardship across the US and around the world due to the pandemic, the Fed affirms that the economy “will face severe disruptions” and will need “aggressive efforts” to limit job and income losses.
The number and breadth of initiatives to rescue the financial system exemplifies the severity of the breakdown. The plan will require more “money printing” to deliver on all of its promises.
Partial List of Latest Fed Measures
- Accelerating asset purchasing program
- Purchasing unlimited amounts of Treasuries and mortgage-backed securities, triggering quantitative easing
- Buying corporate bonds, municipal bonds and asset-backed securities – for the first time
- $300 billion plan to support “the flow of credit” to employers, consumers and businesses
Meanwhile, the $2 trillion stimulus package that would put checks into the hands of Americans hangs in the balance as senators continue to clash, following the Democrats’ move to block its approval.
l
Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
Featured Image: Shutterstock/Lux Blue
[the_ad id=”90130″]
