As many Americans are waiting for their $1,200 government stipend from the $2.2 trillion CARES act signed into law over 10 days ago, Wall Street is already looking for another traunche.
Here’s the breakdown of the spending in the law.
- $250 billion will go for the $1,200 checks that most of us will receive in a couple weeks.
- $250 billion will be provided for extended unemployment insurance benefits.
- Americans get $500 billion.
- Wall Street and big business get $1.7 trillion or more than triple the amount.
The Banker/Big Business largess is just the beginning in the CARES law. The Federal Reserve can lever up on a 10-1 basis should it need it to buy toxic paper off of balance sheets adding a possible additional $4.5 trillion.
This sum is separate from the estimated $4 trillion the Fed has already pumped into Wall Street in the early days of the Covid-19 market free fall.
All totaled with incidentials you come up with a $10 trillion sum.
However, the $10 trillion comes with no debt because Treasury will just “print” the money.
Normally this type of action would cause inflation, but since no retailer really has any pricing power right now and the consumer is constrained by the lock down, there is little chance of prices rising in the short term.
So my question is, why did you limit the aid afforded to the American people to roughly 1/20th of the total available funds?
Surely we could use more than $500 billion of the possible $10 trillion being “printed” to avert a depression.