The Federal Reserve's aid efforts successfully lifted liquidity concerns, but keeping the central bank's spigot open too long could create a massive market threat, Ed Yardeni, the president of Yardeni Research, said in a note to clients on Monday.
The central bank's March 23 announcement of new intervention marked a turning point for financial markets. The Fed's move reassured investors, who piled back into riskier bets.
"The goal was to restore liquidity to the credit markets. They are clearly functioning well again," he wrote. "If the Fed persists in flooding the markets with liquidity, the risk is that the Fed will create the greatest financial bubble of all times."Read more
Comments made by Energy Secretary Dan Brouillette comparing the alleged wariness of some financial institutions to invest in the oil industry to discriminatory redlining prompted additional congressional scrutiny last night.
House Financial Services Chairwoman Maxine Waters (D-Calif.) blasted Brouillette in a letter over comments he made in a recent Axios interview that invoked historical redlining in comparison to some banks refusal to invest in oil plays like Alaska's Arctic National Wildlife Refuge.
In addition to the condemnation on redlining, Waters pressed DOE to provide additional details about how the Trump administration planned to leverage the Federal Reserve to help the reeling oil and gas industry.Read more
The U.S. mining industry is spearheading a lobbying effort to protect a $160 billion pandemic tax break after congressional Democrats largely repealed the provisions in their recent stimulus bill, according to emails and a letter seen by Reuters.
The tax provision folded into the $2 trillion Coronavirus Aid, Relief, and Economic Security (CARES) Act in March has been criticized by Democrats and public advocacy groups as a stealth giveaway for the wealthy. Its exact provenance in the legislation and which interested parties advocated for it remain unclear.Read more
The coronavirus recession is pushing many companies into bankruptcy, a painful process that has led to layoffs, wiped out some investors and hurt the economy.
But the chief executives of some of these businesses are doing just fine.
The chief executive of Whiting Petroleum, which sought bankruptcy protection in April, received $6.4 million, and Chesapeake Energy is paying bonuses ahead of an expected bankruptcy filing.Read more
Despite Trump’s very specific promises to Midwestern farmers during the campaign that helped turn traditionally purple Iowa blood red, the economic pain in farm country has only increased due to his ill-conceived trade wars and weakened biofuels policy.
To take one example, ethanol producers — and the corn farmers who rely on them for a substantial portion of their market — had to deal with historic floods last year and the collapse of fuel demand due to COVID-19 shutdowns this year and, rather than getting the relief they expected, they have gotten more deals benefitting the oil industry.Read more