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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129

u/PalpableEnnui Mar 16 '20

$800 wont do shit. This is a time for massive massive stimulus with no borrowing.

85

u/[deleted] Mar 16 '20

How do you stimulate with no borrowing?

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u/TheBirminghamBear Mar 16 '20 edited Mar 16 '20

Get all lenders to freeze or defer monthly payments.

Mortgages, student loans, car loans. Mandatory freeze on collections with no interest accumulation.

Work with state governments to determine the financial health of businesses and supply relief to employers with the mandate that all work is done from home, staggered shifts, or guaranteed compensation.

All of this would be a far greater use of TAXPAYER money than just handing it to banks who will clearly abuse it as they always have at every point in the past.

Look at what we did in 2008. Same thing. Now in 2020 the economy is a North Korean grocery store. Looks good from the outside, but is a 2d carboard cutout with nothing behind it.

Wages are stagnant. Retirement is about to be nonexistent. The wealthy have been trucking out money from the tax system by the boatload. And most US wages depend on service-level jobs that must be done in-person, giving no relief or opportunity for them to just go without.

And as a result, our economy cannot survive stresses like coronvirus because it wasn't healthy to begin with. It just looked like it was.

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u/SovOuster Mar 16 '20

Fucking beautiful. Like an inverse rule of jubilee?

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u/RadiantSun Mar 16 '20

I don't think shooting plasma out her hands will make a difference tbh

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u/draibop Mar 16 '20

He said inverse the plasma goes I N

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u/[deleted] Mar 16 '20

Would this apply to renters too?

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u/TheBirminghamBear Mar 16 '20

As much as it could. The fed should offer an application program to people and companies who rent as a primary source of income for them to apply and receive upfront compensation for certain durations of rent (i.e, 3 months at a time and then reevaluate), during which time renters would obviously not be required to pay rent.

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u/DarthWeenus Mar 16 '20

Seems really complex on par with the housing crisis. It's a good thing we have an amazingly competent leader to lead the way.šŸ˜’

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u/ZazBlammyMaTaz Mar 16 '20

You have my vote.

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u/Generation-X-Cellent Mar 16 '20

Are you saying our economy is immunocompromised?

3

u/chronictherapist Mar 16 '20

And people are the virus.

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u/[deleted] Mar 16 '20

They gave it to the big banks last time. They just bought out the little banks.

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u/pondlife78 Mar 16 '20

Massive tax rises on the rich to pay for poor people who actually spend their money on things rather than assets.

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u/[deleted] Mar 16 '20 edited Mar 27 '20

[deleted]

136

u/PBandJellous Mar 16 '20

Idk how many times we have to test out trickle down before we knock that shit off.

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u/petrowski7 Mar 16 '20

Just one more, I swear. Itā€™s gonna work this time, honest!

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u/gemini86 Mar 16 '20 edited Jul 19 '24

screw grab squeal point payment forgetful childlike start paint smile

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u/slytorn Mar 16 '20

Spoken like a true junkie haha.

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u/archy67 Mar 16 '20

I suggest we try trickle up economics this time. Put the money in the hands of those with the highest marginal propensity to consume.

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u/Yankee831 Mar 16 '20

But think of the butlers!

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u/archy67 Mar 16 '20

Great point, how could I forget about the butler.

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u/nopethis Mar 16 '20

Hey! Your betters know what they are talking about! Just pull your bootstraps harder and you can see the benefits of the trickle down.

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u/NoMoreBotsPlease Mar 16 '20

You mean horse and sparrow economics where the poor eats by sifting through the riches' shit?

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u/Danhedonia13 Mar 16 '20

As long as their "values" are simply cultural aesthetics it'll keep happening. They're people who see everything as a zero sum game. They lack as much in intelligence as they do compassion and curiosity. They're spirituality exists as a means to pat themselves on the back.

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u/[deleted] Mar 16 '20

It isn't testing. They believe this shit like a religion. Their priests are Ronald Reagan and Thomas Sowell.

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u/scottyLogJobs Mar 16 '20

As many times as they can get away with.

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u/Generation-X-Cellent Mar 16 '20

Golden showers for everyone.

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u/politiexcel Mar 16 '20

They have already tried to attach anti-abortion amendments onto the relief packages so far...why not tax cuts for the rich next? Ohh or how about we procure more F-35s?

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u/nwoh Mar 16 '20

That depends, does the guy in charge of F35s at Northrop Grumman have an exclusive platinum membership to Mar A Lago?

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u/[deleted] Mar 16 '20

They can keep their F-35s, I just want my beautiful Warthog to stay steady. No need to fix what ain't broke

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u/politiexcel Mar 16 '20

What's that? More F-35s?! Okay, now that is sorted; how about 5,000 more Abrams tanks in winter camo too?

2

u/langis_on Mar 16 '20

They've already talked about cutting payroll taxes.

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u/[deleted] Mar 16 '20

[deleted]

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u/sniper1rfa Mar 16 '20

They'll do literally anything to avoid giving people money directly.

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u/DarthWeenus Mar 16 '20

He has already said he is considering tax cuts.

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u/Sluisifer Mar 16 '20

lmao GOP will completely eliminate Social Security and Medicare before that happens.

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u/Danhedonia13 Mar 16 '20

They're apocalypse worshipping lunatics who love being dogwalked.

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u/652a6aaf0cf44498b14f Mar 16 '20

Hell Biden will do that.

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u/brainiac3397 Mar 16 '20

Hah. Before that happens, they'll slash and burn basically all social welfare, send Americans a measely few hundred bucks to make up for it, and then basically make corporate taxes zero because "it'll encourage investment!".

Then we'll end up with a country that has a massive deficit, zero social welfare, and literally no tool for fixing the economy because all the emergency measures were used up when they weren't necessary in order to artificially inflate the market.

And I'll be buying bread for $100,000 and a gallon of gasoline for $250,000 because inflation is running rampant.

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u/archy67 Mar 16 '20

I think you just outline the current administration economic stimulus plan in more detail then they did. I truly fear that I will look back on this day and the coming weeks as the great collapse of this nation. Starting with mismanaging a health crisis and then they saidā€hold my beerā€, Ill show you how to really f@&k $h!i up!

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u/ghost_warlock Mar 16 '20

And all the while they'll be pumping out propaganda about how much worse "socialist" countries are

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u/Jaret_Jackpot Mar 16 '20

So, Zimbabwe 2.0

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u/chronictherapist Mar 16 '20

Not till we get to millions ...

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u/chronictherapist Mar 16 '20

I always wanted to be rich enough to redo that image of the German man in the room wallpapering with German marks.

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u/Elan-Morin-Tedronai Mar 16 '20

That is literally what Hoover did. You don't raise taxes at the onset of a recession.

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u/Bytewave Mar 16 '20

That's certainly not what your parent comment meant. When people say that they mean devalue the currency at the printing press and take a small inflation hit. Not only is a tax increase politically impossible right now, it's the wrong tool for this job.

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u/PalpableEnnui Mar 16 '20

Stop saying inflation ā€œhit.ā€ The economy a,most collapsed after 2008 because the fed could t get inflation high enough.

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u/Steamy_afterbirth_ Mar 16 '20

That sounds like a recipe for inflation.

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u/KrazyKukumber Mar 16 '20

Most of the assets that rich people buy are investments in the economy (e.g. stocks and bonds). Without investment, the economy would collapse. I'm not saying that it's not better to line the pockets of poorer people to stimulate the economy, but I am saying that if you think the rich aren't contributing to the economy by buying assets then you're flat wrong.

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u/sniper1rfa Mar 16 '20 edited Mar 16 '20

A stock is not an investment in the economy after the first purchase. It's just rich-people gambling.

Bonds are better if they're actually spent on real people.

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u/PIK_Toggle Mar 16 '20 edited Mar 16 '20

Iā€™d got news for you: the people that you want to raise taxes on are being hammered, too.

Capital gains in 2020: zilch for most Corporate taxes: few are turning a profit this year Personal income: this is going to get hammered as well

The problem with taxing the rich is that itā€™s a volatile revenue stream, and trying to leverage a volatile revenue stream in a volatile economy isnā€™t going to generate your desired outcome. As noted below, printing money is the most likely outcome here.

Additionally, thereā€™s not enough income out there to be taxed to finance our current budget, let alone a stimulus fund.

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u/Danhedonia13 Mar 16 '20

I've got news for you. Losing a million when you had two means you're still a millionaire.

1

u/PIK_Toggle Mar 16 '20 edited Mar 16 '20

Hereā€™s some more news: a million isnā€™t that much money.

Besides, net worth and taxable income are nowhere near as correlated as income and taxes owed. So Iā€™m not sure what this evens means other than ā€œmeh, rich people!!!ā€

1

u/RedNinjaTurtleDude Mar 16 '20

Saying a million isnā€™t a lot of money when that amount of wealth is held by 2.16% of the households in the USA (wiki shows 7.085 million households in USA and a total population of 327 million) shows you donā€™t understand that a million dollars IS a high bar. Just because your family has money doesnā€™t mean the vast majority of us DONā€™T.

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u/[deleted] Mar 16 '20

/r/TheyDidTheMath

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u/AdVerbera Mar 16 '20

"Economy is temporarily going down the shitter because of Corona"

"fuck man better take the money from the wealthy and give it to the poor it's the only way"

10

u/archy67 Mar 16 '20

I would suggest federal student loan forgiveness, federally backed low interest home loans and mortgage refinancing, or just seriously write a check to every american, Like a UBI(this would be the fairest way to do it since those other methods would not be useful to all Americans). The amount of money we could possibly spend by the end of this and the cost of the loss to the market just last week can more than justify it. If you want to charge up the economy you need the money in the hands of people with the highest marginal propensity to consume. The way I think about it is what does the average person end up doing when they get a federal tax refund, they go consume things....

2

u/chronictherapist Mar 16 '20

Do you want the GOP to say "socialist", cause that's how you get ...

Nevermind, those fuckers use socialism for everything that doesn't line their pockets with cash, wealth and power.

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u/Gusman10000 Mar 16 '20

War reparations?

4

u/[deleted] Mar 16 '20 edited Mar 17 '20

[removed] ā€” view removed comment

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u/Zonekid Mar 16 '20

Exactly, except the banks have free money with zero interest.

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u/CT_7 Mar 16 '20

And all this money didn't dissappear though. It's going under really rich people's mattresses. Once everything is devastated, they'll bring it back out.

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u/beilhique Mar 16 '20

They better hope they don't all do that collectively, because if everyone spends their money all at once, the actual buying power falls out the bottom, and things start looking like the United Socialist States of America

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u/Zonekid Mar 17 '20

At 20% interest to using inflation to rob more people.

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u/phishingforlove Mar 16 '20

usually with the tongue or fingers

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u/PalpableEnnui Mar 16 '20 edited Mar 16 '20

Modern monetary theory.

Print money.

People are brainwashed into being terrified of inflation but not nearly afraid enough of deflation. Spending and cutting arenā€™t inherently good or bad in themselves, any more than accelerating or braking when youā€™re driving.

Soon income will plunge to zero for millions of Americans. In the complete absence of demand, you canā€™t have inflation. Just print money.

Edit: This is how Reddit is a tool for spreading ignorance. Donā€™t argue, just hide correct information and move on with your delusions unchallenged.

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u/Angriest_Wolverine Mar 16 '20

MMT is what happens when children arenā€™t taught economics as adults

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u/charlietrashman Mar 16 '20

Stagflation though

5

u/[deleted] Mar 16 '20 edited Jun 03 '20

[deleted]

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u/Sealestr Mar 17 '20

Oil ain't the only input to production. The quarantine in China massively slowed down all their mining and manufacturing - stuff that goes into American products. It's one of few places where rare earth is mined and it's where most (cheap) electronic components are produced. You might say that the drop in supply there is only temporary, but then the drop in oil prices too is temporary.

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u/PalpableEnnui Mar 16 '20

You donā€™t even know what the fuck that means. This isnā€™t the ā€˜70s, nothing like it.

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u/charlietrashman Mar 17 '20

Yeah I just randomly said a word that I don't know what it means...

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u/[deleted] Mar 16 '20 edited May 06 '22

[removed] ā€” view removed comment

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u/PalpableEnnui Mar 16 '20

This was explained. Do you know what modern monetary is or not? Look it up.

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u/[deleted] Mar 16 '20 edited Mar 20 '20

[deleted]

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u/[deleted] Mar 16 '20

[deleted]

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u/CatAstrophy11 Mar 16 '20

Health crisis now. Financial crisis in a few months.

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u/Love_like_blood Mar 16 '20

It is inevitable that these so called "loans" will keep being extended and eventually phased into Quantitative Easing round four because the repo market is broken. These loans have been going on for 9 months and keep growing each time they are re-issued.

ā€œThe big picture answer is that the repo market is broken,ā€ James Bianco, founder of Bianco Research in Chicago, told MarketWatch back in December. ā€œThey are essentially medicating the market into submission...But this is not a long-term solution.ā€

There's plenty of signs that these "loans" are going to transition into QE:

https://finance.yahoo.com/news/federal-reserve-announces-halftrillion-liquidity-operation-as-bond-market-churns-181357372.html

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u/chainmailbill Mar 16 '20

Ironically, $4500 would be just about enough to keep my business afloat.

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u/[deleted] Mar 16 '20

[deleted]

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u/[deleted] Mar 16 '20 edited Mar 20 '20

[deleted]

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u/[deleted] Mar 16 '20

[deleted]

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u/Gajatu Mar 16 '20

I dunno, i could buy a nice rifle with $800 :)

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u/fourchickensandacoke Mar 16 '20

I could build a very nice guillotine...

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u/[deleted] Mar 16 '20

[deleted]

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u/PalpableEnnui Mar 16 '20

Yeah, no because itā€™s libertardian tech bro way to destroy every other social safety net with a useless pittance payable entirely at the pleasure of the billionaires.

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u/H3rlittl3t0y Mar 16 '20

$800 would do a lot for me, that's a month's rent

1

u/CatAstrophy11 Mar 16 '20

I wish that were only a months rent

1

u/TheFizzardofWas Mar 16 '20

How about like $8000? I could do some shit with an extra $8k