News Roundups

Airlines find bailout loophole, big banks aren't embracing Fed program, and other news

Daily news headlines about the stimulus and recovery from July 9, 2020.

Daily news headlines about the stimulus and recovery from July 9, 2020.

The Airline Bailout Loophole: Companies Laid Off Workers, Then Got Money Meant to Prevent Layoffs

Three airline industry companies slated to receive $338 million in public money designed to preserve jobs in the hard-hit industry have laid off thousands of workers anyway, according to Treasury disclosure filings and public layoff data.

The largest company, Gate Gourmet, is a global preparer of airline meals and part of a Swiss conglomerate owned by the private equity firm of wealthy Malaysian businessman Richard Ong. Gate Gourmet is scheduled to get $171 million from the federal program to bail out the airline industry even after it reported laying off thousands of workers at airports in half a dozen states, including California, Georgia, New York and Illinois, in recent months, according to public filings. The exact number of workers who lost their jobs is not clear.

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Big Banks Aren’t Embracing Fed’s Main Street Loan Program

The Federal Reserve Bank of Boston on Wednesday released a list of lenders that have signed up for the central bank’s midsize-business lending program and are willing to make loans to new customers through the initiative.

Noticeably absent are most of the nation’s biggest banks. Only Bank of America has so far agreed to participate and take on new clients, based on the Boston Fed’s release, while lenders like JPMorgan Chase, Citigroup and Wells Fargo are not listed.

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Fed’s Main Street lending program doesn’t have many large banks making loans to new customers

More than three months after the Fed announced a new effort to shore up the economy aimed at small and medium-size businesses, its $600 billion loan program has only one of the nation’s largest banks signed on to deliver the loans to new customers.

On Wednesday, the Federal Reserve Bank of Boston disclosed the list of lenders that have agreed to participate in the Main Street Lending Program, extending Fed-backed loans to new customers. Of the nation’s largest banks, only Bank of America has registered.

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Oil Went Below $0. Some Think It Will Rebound to $150 One Day.

Oil markets began the 2020s by nosediving below $0 a barrel for the first time. Investors and analysts are now trying to work out what the rest of the decade holds in store.

Some think the bust will set in motion a boom, predicting that investment in oil-and-gas production will dry up and propel crude prices back above $100 a barrel.

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