Powell spoke shortly after the central bank unveiled over $2 trillion in new lending for small businesses, city governments and big firms
Federal Reserve Chair Jerome H. Powell said Thursday the U.S. economy is in an emergency and is deteriorating “with alarming speed.” His remarks came shortly after the central bank unveiled over $2 trillion in new loans to keep the economy afloat as much of the nation goes into a lockdown to fight the spread of the deadly“People have been asked to put their lives and livelihoods on hold, at significant economic and personal cost,” Powell said in a Brookings Institution webcast.
The Fed’s sweeping new loan programs unveiled Thursday will provide $2 trillion in additional aid to small, medium and large companies as well as cash-strapped states and cities. The latest actions are in addition to the central bank slashing interest rates to zero in March and buying numerous government bonds in an effort to keep borrowing as cheap as possible for American families and businesses.
There’s widespread agreement people must feel safe to go out again, and the worst possible outcome would be opening the economy too early, triggering another spike in coronavirus cases and deaths.“We need to have a plan nationally for reopening the economy. We all want it to happen as quickly as possible,” Powell said. “We all want to avoid a false start where we partially reopen and that results in a spike in coronavirus cases.
“We’re going to have to think hard about what are the things that will have to make us feel it’s safe to shop again or eat out again,” Barkin said in an interview.After 9/11, President George W. Bush encouraged people to go out and spend as a form of patriotism, and the nation responded. But that is unlikely to work again, given that the health issues touch so much of the economy.
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