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- CARES Act (Coronavirus Aid, Relief, and Economic Security Act)
- Largest rescue package in American history
- $2 trillion total
- $300 billion to individuals
- Individuals prorated from $75K to $99K AGI
- Couples prorated from $150K to $198K AGI
- $1200 per adult and $500 per child
- $600 addition per week for unemployed
- ~90% of households (165 million) would benefit from the checks
- Payment will be non-taxable
- Steve Mnuchin, "We’re determined to get money in people’s pockets immediately. That will be within three weeks."
- $350 billion forgiveable loan to small businesses if they keep workers employed
- $58 billion for airlines
- $100 billion of hospitals
- $20 billion for veterans
- $8.8 billion for child nutrition
- $15.5 billion for SNAP (food stamps)
- $340 billion for state and local governments
- Thomas Massie delayed vote by requesting to have a recorded vote
- "Mnuchin told reporters at a White House press briefing earlier this week that he believed the bill would keep the economy afloat for three months if the coronavirus effects are felt that long."
- Nancy Pelosi, "We think we'll get more direct payments in another bill."

Links:
- Trump signs $2T coronavirus relief package
- What's Inside The Senate's $2 Trillion Coronavirus Aid Package
- Senate Passes $2 Trillion Coronavirus Relief Package
- F.A.Q. on Stimulus Checks, Unemployment and the Coronavirus Bill
- Mnuchin: Stimulus checks will arrive within three weeks

Posted: 2020-03-27 18:05:02

Fed balance sheet explodes to $5.25 trillion.

Jerome Powell, “When it comes to this lending, we're not going to run out of ammunition. That doesn't happen."



Links:
St Louis Fed - Fed balance sheet
FEDERAL RESERVE statistical release - March 26, 2020
Powell: Federal Reserve will not 'run out of ammunition' to protect economy

Posted: 2020-03-27 06:19:33

3.283 million filed for unemployment. Previous record was 695,000 in Oct 1982.



During the Great Depression of 1929, highest level of unemployment was 24.9%. But, that figure only included men.



We will blow away the 25% unemployment from the Great Depression, but now it also includes women.

Posted: 2020-03-26 21:13:35

Some companies tapping into credit lines:
- Hilton - $1.8 billion
- Wynn Resorts - $850 million
- Air France-KLM - $1.2 billion
- Kraft Heinz - $4 billion
- Royal Caribbean - $2.8 billion

Reasons:
- Drying up of revenue
- Drying up of bond market
- Still need to pay expenses
- Drying up of commercial paper market
- Potential credit freeze in near future

Links
Big Firms Draw Down Billion Dollar Credit Lines
Businesses Face a New Coronavirus Threat: Shrinking Access to Credit
US companies eye credit lines as pandemic worsens, uncertainty soars
Banks scramble as companies rush to tap back-up credit lines

Posted: 2020-03-21 12:10:16

Coronavirus
- Coronavirus cases top 200,000
- Coronavirus has now spread to all 50 states and DC, US death toll passes 100
- Thousands line up for first drive-thru coronavirus testing

Finance/Business
- Fed cuts rate to 0, starts QE
- Reserve requirements cut to zero
- Fed Establishes Currency Swaps With 9 Central Banks
- Fed backstops money markets
- Fed backstops municipal bonds
- Dow drops 3,000 points on Monday
- 10-year Treasury yield sees biggest one-day drop since March 2009 after Fed’s emergency actions
- NYSE to temporarily close floor
- Dow closes below 20,000
- 1 and 3 month Treasuries hit negative rates
- Paper and physical gold price decouple
- Unemployment claims skyrocket
- ECB announces €750 billion Pandemic Emergency Purchase Programme
- Oil hits 18-year low
- Companies suspend earnings forecast
- Manufacturing orders plunge from 33.6 to -15.5
- Bank of England (BOE) cut interest rates to 0.1%

World
- France and Spain ban all non-essential activities
- Canada closes borders to foreign travelers
- England to shut schools
- European Union closes external borders
- China Expels American Journalists
- UK national lockdown

Government
- Atlanta mayor declares state of emergency in city
- House lawmakers indefinitely postpone return to Washington
- Supreme Court, for first time since 1918, postpones oral arguments
- Canadian border closes
- Government bailout requests top $1 trillion
- Congressman insider trading

Closures
- Closure of restaurants, bars in Washington state will last 2 weeks and may be extended
- NY City Schools, Restaurants and Bars Are Shut Down
- Chick-fil-A closes dining room doors
- T-Mobile Closes Indoor Mall Stores
- T-Mobile closes 80% of corporate retail stores
- Bay Area counties ordered to shelter in place
- Automakers temporarily shut down factories
- Malls shut down
- Hollywood Studios Halt Film And TV Production
- Atlanta limits restaurants, closes bars
- California issues order to ‘stay at home’

Links
- "Total F**king Carnage" - Global Liquidation Accelerates Despite Massive Monetary Intervention
- 3/16 updates

Posted: 2020-03-20 16:07:36



- The difference between the FRA (Forward Rate Agreement) and OIS (Overnight Index Swap)
- For the US, the FRA is the 3-month Libor (London interbank offered rate)
- For the US, the OIS is the Fed Reserve overnight index rate
- An indicator of funding stress in the banking sector and liquidity shortage
- Peaked to 170 in November 2008
- Has spiked to 2009 levels

Links
Something Is Breaking: Fed Fails To Ease Epic Dollar Shortage As FRA/OIS Goes Parabolic
Why It Matters That the FRA-OIS Spread Is Widening
Deeper look at the spike in the 3-month FRA-OIS spread and repo rates.

Posted: 2020-03-14 09:14:24


Posted: 2020-03-13 17:50:56

- Officially over 20,438 people affected in China with over 425 deaths
- Spread to at least 23 countries
- 150 confirmed cases of the virus outside China with 11 confirmed cases in the US
- Originated from a Wuhan seafood market
- Originated from either bats or snakes
- First detected in Dec 2019
- Wuhan under strict lockdown (7th largest city in China)

Interactive Maps:
WHO
Medgic
Johns Hopkins

Charts:
Worldometers

News:
Corona Tracker
FOX news
BBC
The Guardian
Aljazeera

Info:
WHO
Wikipedia
CDC

Articles:
Coronavirus Map: Tracking the Spread of the Outbreak
How China's coronavirus outbreak started, explained
Everything you need to know about the coronavirus from China
Mapping the spread of the new coronavirus

Twitter:
#coronavirus
#coronavirusoutbreak

Posted: 2020-02-03 21:43:43

- Fed will continue to intervene in repo market until Jan 2020
- Fed will buy $60 billion a month of short term bills
- Powell says, "This is not Q.E."
- Fed balance sheet starts rising and at a rapid pace



Links:
The Fed is extending its overnight funding operations through January 2020
Fed Unveils Plan to Expand Balance Sheet but Insists It’s Not Q.E.
Fed Brings a Bazooka to Its Fight With the Repo Market
Fed total balance sheet

Posted: 2019-10-12 12:12:12

- Short-term (overnight) borrowing through sale and repurchase of securities
- The sale of a security combined with an agreement to repurchase the same security at a higher price at a future date
- Securities are not considered a sale for tax purposes, but considered as collateral
- Money market funds significant player in repos
- Also used by broker-dealers, hedge funds and other institutional investors
- More than $1 trillion worth of overnight repo transactions collateralized with US government debt occurring every day

Links:
Wikipedia - Repurchase agreement
Why the Repo Market Is Such a Big Deal—and Why Its $400 Billion Bailout Is So Unnerving
Repo and Reverse Repo Agreements



Posted: 2019-09-24 21:49:57


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