The Federal Reserve announced on Monday that they will buy assets for as long as it takes to keep the markets propped up, as an orgy of inflation will be used to combat recession and depression during the coronavirus pandemic.
The Fed claims that it will buy back assets “in the amounts needed to support smooth market functioning and effective transmission of monetary policy to broader financial conditions and the economy.”
The central bank will be moving into the corporate bonds market for the first time, buying up investment-grade securities in primary and secondary markets. They will also make purchases through exchange-traded funds as well. They will continue leading to supposed Main Street businesses and the Term Asset-Backed Loan Facility that was initiated during the financial crisis as well.
Other inflationary programs initiated by the Fed include $300 billion to support “the flow of credit” toward employers, consumers and businesses while two facilities are created to give credit to large employers, creating an economy essentially subsidized by payouts from unaccountable government bureaucrats.
These policies hearken back to the quantitative easing measures instituted during the Obama regime, which were meant to be temporary in order to stabilize the economy following a recession. They have now become permanent with the new crisis being used as an excuse for a de facto nationalization of the economy.
“We are now in QE infinity, again,” noted Peter Boockvar, chief investment officer at Bleakley Advisory Group, to CNBC.
“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,” wrote Chris Rupkey, chief financial economist at MUFG Union Bank. “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.”
The Fed is not anywhere close to being finished, as they have entered crisis mode and nothing is off the table. There will potentially be no end to their economic interventions.
“The coronavirus pandemic is causing tremendous hardship across the United States and around the world. Our nation’s first priority is to care for those afflicted and to limit the further spread of the virus,” the Fed said in a statement.
“While great uncertainty remains, it has become clear that our economy will face severe disruptions. Aggressive efforts must be taken across the public and private sectors to limit the losses to jobs and incomes and to promote a swift recovery once the disruptions abate,” they added.
The Trump administration, which initially promised to drain the swamp, is behind the Fed 100 percent as they inflate the economy into oblivion.
“We are committed to providing relief for American workers and businesses, particularly small and medium size businesses and critical industries that are most impacted by the coronavirus. We will take all necessary steps to support them and protect the U.S. economy,” Treasury Secretary Steven Mnuchin said in a statement.
By the time the Fed is done, recent gains in the economy could be permanently destroyed as hyperinflation or other unforeseen problems result from their mismanagement of the monetary supply.