{"id":53997,"date":"2020-07-04T06:19:00","date_gmt":"2020-07-04T11:19:00","guid":{"rendered":"https:\/\/olduvai.ca\/?p=53997"},"modified":"2020-07-04T06:19:08","modified_gmt":"2020-07-04T11:19:08","slug":"the-fed-just-picked-the-big-guys-again-over-individuals","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=53997","title":{"rendered":"The Fed Just Picked the \u201cBig Guys\u201d (Again) Over Individuals"},"content":{"rendered":"\n

The Fed Just Picked the \u201cBig Guys\u201d (Again) Over Individuals<\/a><\/h3>\n\n\n\n
\"Fed
Photo by\u00a0Flickr.com\u00a0<\/a>|\u00a0CC BY<\/a>\u00a0| Photoshopped<\/figcaption><\/figure>\n\n\n\n

In a recent\u00a0disclosure<\/a>\u00a0to Congress, the Fed revealed that it just purchased $429 million in bonds from 86 corporations.<\/p>\n\n\n\n

They did this through something called a Secondary Market Corporate Credit Facility (SMCCF). Buried on the Fed\u2019s website, the press release<\/a> explains the intention behind this purchase of bonds:<\/p>\n\n\n\n

The SMCCF will purchase corporate bonds to create a corporate bond portfolio that is based on a broad, diversified market index of U.S. corporate bonds.<\/strong> This index is made up of all the bonds in the secondary market that have been issued by U.S. companies that satisfy the facility\u2019s minimum rating, maximum maturity, and other criteria.<\/p><\/blockquote>\n\n\n\n

According<\/a> to Agora\u2019s 5-Minute Forecast, the Fed also plans to purchase an additional $320 million of corporate bonds in the near future.<\/p>\n\n\n\n

If you read the bolded phrase above from the Fed\u2019s press release, you might think they intend to use this as an opportunity to help the \u201clittle guy\u201d weather the recent economic storm.<\/p>\n\n\n\n

But the \u201cbroad, diversified market index\u201d that the Fed claims it\u2019s rescuing doesn\u2019t appear that broad\u2026 or that diversified.<\/p>\n\n\n\n

The list includes giants like AT&T, Walgreens, Microsoft, Pfizer, Apple, Walmart, Comcast, Ford, Boeing, Cisco and Visa.<\/p>\n\n\n\n

It goes without saying that these behemoths can weather out the storm while the smaller corporations struggle and lay off employees.<\/p>\n\n\n\n

Fed Doing Its Best to Make Sure the \u201cBig Guys\u201d Keep Winning<\/strong><\/p>\n\n\n\n

The same edition of Agora\u2019s 5-Minute Forecast sums up another example<\/a> of a confused<\/a> Fed:<\/p>\n\n\n\n

The fact the Fed is buying corporate bonds at all signals favoritism toward big existing players \u2014 indebted lumbering behemoths that can\u2019t innovate. It\u2019s not as if the Fed is going to take the largesse it creates from thin air and spread it around to a plucky but capital-starved startup, right?<\/p><\/blockquote>\n\n\n\n

\u2026click on the above link to read the rest of the article\u2026<\/p>\n","protected":false},"excerpt":{"rendered":"

The Fed Just Picked the \u201cBig Guys\u201d (Again) Over Individuals In a recent\u00a0disclosure\u00a0to Congress, the Fed revealed that it just purchased $429 million in bonds from 86 corporations. They did this through something called a Secondary Market Corporate Credit Facility (SMCCF). Buried on the Fed\u2019s website, the press release explains the intention behind this purchase of bonds: […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[2809,18769,21017,827],"class_list":["post-53997","post","type-post","status-publish","format-standard","hentry","category-economics","tag-bailouts","tag-birch-gold-group","tag-bond-purchases","tag-united-states"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/53997","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=53997"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/53997\/revisions"}],"predecessor-version":[{"id":53998,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/53997\/revisions\/53998"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=53997"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=53997"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=53997"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}