Powell has gone full-blown "He-Man," wielding - the sword of power from his pedestal at the Federal Reserve. This once-scorned appointee has teamed up with Steven Mnuchin, Secretary of the Treasury,
to create the ultimate power play and flex the FED muscles more than Rocky Balboa on the steps of the Philadelphia Museum of Art.
Powell stated, "We will do everything in our power to keep the economy going" on 04/09/20 (queue "Eye of the Tiger" by Survivor), which created a brief reprieve in the financial markets.
Below are a few policy examples enacted to deter the impact -
$ 500 Billion in loans to states to keep them stress-free
It will directly finance the PPP program (Paycheck Protection Program)
$349 Billion in rescue loans to small businesses through the SBA program
Buy up to $ 600 Billion in loans for companies in stress (have to bail out the CEO's)
Remove the restrictions at Wells Fargo to allow higher leverage in lending (remember, they got in trouble for fake accounts)
Relax the treasury holding rule for banks and other financial institutions.
These are only a handful of the 35 actions the Federal Reserve took to protect our livelihoods- a record in their history. View the complete policy list here: https://www.federalreserve.gov/
The best part of all this is who the Federal Reserve has teamed up with to finance this Bazooka:
BlackRock.
This is where the secret society of the Wall Street system surfaces. BlackRock manages 7.43 Trillion in assets globally. It's a monster of a company with more capital and power than many other institutions.
I can only imagine the hypothetical conversation between Larry Fink, the CEO of BlackRock, and Powel:
Powell: "Hey Larry, we need to spend 6 Trillion dollars, and we want to borrow some of that from you and buy bonds and make sure companies don't go bankrupt."
Fink: " You want to borrow money from us and buy our investments so we don't lose money?"
Powell: " Yes."
Fink: " Sign me up."
They are also munching on canapes. I could be wrong- and probably am- but some speculative humor gets me through the day. Keep on Spending, Powell! Your grandkids will love [or hate] you!
Cheers Chris
Christopher R. Lakian
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