Millions of U.S. households are already facing desperate crises.

The most important economic problem the United States is facing is the failure to contain Coronavirus and the unethical decisions politicians have been making to reopen without the administrative capacity to limit the virus’s spread.

The Keynes crisis, the Minsky crisis and the Means crisis

Muni Purchases Are Finally Here

Ten days after the last central bank swap line announcement, the Federal Reserve followed up with an announcement of another facility meant to help a lower tier of central banks. In this facility the Federal Reserve would make a standing offer to temporarily purchase U.S. treasury securities from central banks (and supranational monetary institutions) and sell them back to them the following day.

At the risk of making it seem like central bank swap lines are the solution to every problem, a swap line for local and state governments is the perfect tool using the Federal Reserve’s existing legal authority and can facilitate supporting these local currencies.

Congress recently passed a 1.5-1.7 Trillion dollar stimulus bill (as I wrote about last week, the reported headline number is including a useless accounting gimmick which provides no additional support to the U.S. economy). Part of the reason we can report such an exact number is congress budgets in exacts.Take a look at these two sections of the CARES Act, picked at random.

The International Aspects

Hear comes the corporate debt purchases.

The Federal Reserve has taken an extraordinary amount of actions over the past two weeks (most of which have happened over the course of 8 days from March 15th to March 23rd) to calm financial markets and sustain the flow of credit to households and businesses to respond to the coming Coronavirus-induced depression.