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Federal Reserve cuts rates to zero and launches massive $700 billion quantitative easing program
CNBC ^ | 3/15/2020

Posted on 03/15/2020 2:12:17 PM PDT by billyboy15

The Federal Reserve, saying “the coronavirus outbreak has harmed communities and disrupted economic activity in many countries, including the United States,” cut interest rates to zero on Sunday and launched a massive $700 billion quantitative easing program to shelter the economy from the effects of the virus.

Facing highly disrupted financial markets, the Fed also slashed the rate of emergency lending at the discount window for banks by 125 bps to 0.25%, and lengthened the term of loans to 90 days.

The Fed also cut reserve requirement ratios for thousands of banks to zero. In addition, in a global coordinated move by centrals banks, the Fed said the Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, the Federal Reserve, and the Swiss National Bank took action to enhance dollar liquidity around the world through existing dollar swap arrangements.

The banks lowered the rate on these swap line loans and extended the period for such loans. Fed Chairman Jerome Powell is scheduled to hold a press conference via telephone at 6 pm eastern time. The actions by the Fed appeared to be the largest single day set of moves the bank had ever taken, mirroring in many ways its efforts during the financial crisis that were rolled out over several months.

The quantitative easing will take the form of $500 billion of treasuries and $200 billion of agency-backed mortgage securities. The Fed said the purchases will begin Monday with a $40 billion installment.

The Fed cut rates to a new range of 0% to 0.25% from 1% to 1.25% and said it would remain there “until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals.”

(Excerpt) Read more at cnbc.com ...


TOPICS: Breaking News; Business/Economy; Government
KEYWORDS: bananarepublic; bondmarket; covid19stockmarket; debt; debtbomb; fed; federalreserve; fedrate; incometaxes; inflation; mmt; moneyprinting; noideas; printing; retirees; savers; soundslegit; taxcutsandjobsact; taxreform; tcja; thefed; what2do
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To: af_vet_1981
Please provide evidence for the claim that a deli lunch doubled in the three years from 2008/9 to 2011/12.

How about going to lunch every day at a deli near where I worked. Sorry I didn't take notes for you.

I also can't provide evidence that the sky is blue where I live.

61 posted on 03/15/2020 2:28:34 PM PDT by Steely Tom ([Seth Rich] == [the Democrats' John Dean])
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To: NRx

Any disruption would be trivial compared to would happen if the markets drop another 20-30%.


The markets are definitely dropping another 20%-30%. It’s just a matter of whether it is tomorrow or in a month or three.


62 posted on 03/15/2020 2:28:34 PM PDT by lodi90
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To: Paladin2
I thought the Fed was out to GET TRUMP!

Not if they have to sacrifice themselves to do it.

So much for principle.

63 posted on 03/15/2020 2:29:02 PM PDT by mewzilla (Break out the mustard seeds.)
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To: laplata
'Trump has been playing chess with the Fed for over three years. He won the game and now he has them in a favorable position.'

As of now, the only victory is massive more debt. Savers have been crushed. Asset prices have been inflated and our budgets haven't been curtailed.

64 posted on 03/15/2020 2:29:06 PM PDT by Theoria (I should never have surrendered. I should have fought until I was the last man alive)
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To: NRx

Get ready for it. It ain’t near being over.


65 posted on 03/15/2020 2:29:16 PM PDT by Vermont Lt
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To: NRx

A Whiff? It’s a full blown stink.


66 posted on 03/15/2020 2:29:38 PM PDT by Fledermaus (PANIC PANIC PANIC PANIC PANIC PANIC PANIC PANIC! Someone sneezed. Shut down everything. Cowards.)
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To: billyboy15

I hope the treasury can take advantage of these low rates.
Watch our federal interest payments start dropping as bills retire.


67 posted on 03/15/2020 2:29:38 PM PDT by DannyTN
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To: be-baw

I’ve tried refinancing my house but refi rates aren’t dropping bc there is so much demand and so therefore banks are keeping those rates steady around 3.75%. They say its bc their staff can’t keep up with demand, i think they are milking consumer. If rates went down where they should be, its more money for us to help economy


68 posted on 03/15/2020 2:29:45 PM PDT by pangaea6
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To: billyboy15

SON OF A B*TCH!!!!


69 posted on 03/15/2020 2:30:25 PM PDT by youngidiot (The left uses book publishing companies to launder large amounts of cash to other leftist.)
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To: Vermont Lt
"Overnight repo market opens at six."

There's no shortage of gov't things and people who I'd like to have repo'd.

70 posted on 03/15/2020 2:30:53 PM PDT by Paladin2
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To: NRx
We are in uncharted waters and there is a whiff of panic in the air. No need to give the panic further room to inflict economic damage.

Closing the markets would be the ultimate act of panic, and would guarantee a major recession.

71 posted on 03/15/2020 2:31:58 PM PDT by DoodleDawg
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To: LiveFreeOrDie2001
"This whole situation IS FISHY!!"

The Banksters already have you on the hook...

72 posted on 03/15/2020 2:32:11 PM PDT by Paladin2
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To: ml/nj
Quantitative easing is just a fancy name for printing money. Suggestions on what they should have done?
73 posted on 03/15/2020 2:32:15 PM PDT by Fury
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To: Vermont Lt
Right. And when banks loan "more" and more money, it should happen at HIGHER interest rates -- they already loaned to the safer, low risk, borrowers at a low rate. More loans - will then go to the higher risk borrowers -- but that added risk needs to be covered by a HIGHER Interest rate, not lower!!!!

This insane move will cause an over-extension of credit - or mal-investment, as Austrian Economists call it - this is REALLY OUTRAGEOUS

74 posted on 03/15/2020 2:32:22 PM PDT by 4Liberty (BERNIE SANDERS: A CRUSTY, ANTI-AMERICAN WEIRDO. - Kurt Schlichter)
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To: lodi90

Hence my call to close the markets for at least the next 30 days.


75 posted on 03/15/2020 2:32:30 PM PDT by NRx (A man of honor passes his father's civilization to his son without surrendering it to strangers.)
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To: billyboy15

When do mortgage rates go down? Been watching but I don’t see anything favorable.


76 posted on 03/15/2020 2:32:35 PM PDT by moovova
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To: Fury
Quantitative easing is just a fancy name for printing money.

Suggestions on what they should have done?

77 posted on 03/15/2020 2:32:45 PM PDT by Fury
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To: Drago

Yep, just checked, Dow futures for Monday were down big before the announcement, now down only 310 points. (2:33pm PDT).


78 posted on 03/15/2020 2:33:07 PM PDT by Drago
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To: billyboy15

What does this mean?

Will I be able to refinance my home at a lower rate if I decide to?

Thank you.


79 posted on 03/15/2020 2:33:23 PM PDT by moviefan8
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To: Vermont Lt

Well I was gonna refi my house, but a 30 day shutdown would certainly kill that plan...


80 posted on 03/15/2020 2:33:27 PM PDT by nascarnation
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