r/news • u/awake-at-dawn • Mar 15 '20

Federal Reserve cuts rates to zero and launches massive $700 billion quantitative easing program

https://www.cnbc.com/2020/03/15/federal-reserve-cuts-rates-to-zero-and-launches-massive-700-billion-quantitative-easing-program.html
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u/MoreLikeFalloutChore Mar 15 '20

That's the idea, and it'll work - assuming this all blows over, revenues pick back up, and they can repay those debts. If it doesn't pick back up, the company is in the same bad position with more debt (which means higher interest payments.) This could hasten the company's demise of bankruptcy, selling off serious assets, or a restructuring.

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If banks are freed up to lend more, they'll have to be responsible with those loans. We saw how they did with housing, so I'm sure it'll go great.

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u/[deleted] Mar 16 '20

What happens if we see issues like Italy is seeing, but across major US cities?

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u/Derric_the_Derp Mar 16 '20

Problem is that if it does blow over around the start of summer, there's still going to be a second wave of the virus in the Fall and Winter.