The Fed’s cure risks being worse than the disease
“To put it bluntly, the Fed isn’t allowed to do any of this. The central bank is only allowed to purchase or lend against securities that have government guarantee. This includes Treasury securities, agency mortgage-backed securities and the debt issued by Fannie Mae and Freddie Mac. An argument can be made that can also include municipal securities, but nothing in the laundry list above.”
USAGOLD note: Bianco goes on to make the astonishing claim that Donald Trump, through this bailout, has made himself chairman of a new kind of Federal Reserve that did not exist a couple of weeks ago – one the result of a merger between the Fed and the Treasury Department. Keep in mind that this analysis does not appear at some conspiracy-minded website but Yahoo and Bloomberg.