'White House Seeks Financial Crisis-Era Powers to Buttress Economy' diff viewer (9/10)

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White House Seeks Financial Crisis-Era Powers to Buttress Economy	White House Seeks Financial Crisis-Era Powers to Buttress Economy
2020-06-17 13:32:17 UTC	2020-06-24 09:12:07 UTC (7 days later)
WASHINGTON — Treasury Secretary Steven Mnuchin said on Sunday that he would ask Congress to reinstate powers that were used during the 2008 financial crisis to support the economy as the coronavirus threatens to grind business activity in the United States to a halt.	WASHINGTON — Treasury Secretary Steven Mnuchin said on Sunday that he would ask Congress to reinstate powers that were used during the 2008 financial crisis to support the economy as the coronavirus threatens to grind business activity in the United States to a halt.
The comments suggest that the White House is bracing for a widespread downturn that could harm sectors well beyond the travel and cruise ship industries, and that the federal government could need to return to the type of crisis-era measures that were ultimately scaled back by lawmakers in the 2010 Dodd-Frank Act.	The comments suggest that the White House is bracing for a widespread downturn that could harm sectors well beyond the travel and cruise ship industries, and that the federal government could need to return to the type of crisis-era measures that were ultimately scaled back by lawmakers in the 2010 Dodd-Frank Act.
Hours later, the Federal Reserve said it would cut interest rates to near zero and snap up large amounts of government-backed debt, along with other efforts aimed at protecting the American economy from the risks of the coronavirus.	Hours later, the Federal Reserve said it would cut interest rates to near zero and snap up large amounts of government-backed debt, along with other efforts aimed at protecting the American economy from the risks of the coronavirus.
Mr. Mnuchin and Jerome H. Powell, the Fed chair, have spoken daily about how to buttress the economy, which faces the prospect of a deep recession as the coronavirus spreads around the world.	Mr. Mnuchin and Jerome H. Powell, the Fed chair, have spoken daily about how to buttress the economy, which faces the prospect of a deep recession as the coronavirus spreads around the world.
“Certain tools were taken away that I’m going to go back to Congress and ask for,” Mr. Mnuchin said on “This Week” on ABC.	“Certain tools were taken away that I’m going to go back to Congress and ask for,” Mr. Mnuchin said on “This Week” on ABC.
He did not specify which tools he was referring to, and a Treasury spokesman declined to comment. In a separate interview on “Fox News Sunday,” Mr. Mnuchin made clear that he meant regulations that were imposed by Dodd-Frank.	He did not specify which tools he was referring to, and a Treasury spokesman declined to comment. In a separate interview on “Fox News Sunday,” Mr. Mnuchin made clear that he meant regulations that were imposed by Dodd-Frank.
That law, passed after the worst financial crisis in decades, took away the Fed’s power to lend to individual failing companies or to take assets off their balance sheets, requiring the central bank to extend emergency credit only through broad-based facilities intended to help the financial system as a whole. Congress also took away Treasury’s ability to use a program, known as the Exchange Stabilization Fund, to guarantee money market funds.	That law, passed after the worst financial crisis in decades, took away the Fed’s power to lend to individual failing companies or to take assets off their balance sheets, requiring the central bank to extend emergency credit only through broad-based facilities intended to help the financial system as a whole. Congress also took away Treasury’s ability to use a program, known as the Exchange Stabilization Fund, to guarantee money market funds.
Mr. Powell said in a news conference on Sunday that the Fed had “nothing to announce” on whether the central bank would seek additional authority to intervene in the financial markets but said “that’s part of our playbook in situation like this.”	Mr. Powell said in a news conference on Sunday that the Fed had “nothing to announce” on whether the central bank would seek additional authority to intervene in the financial markets but said “that’s part of our playbook in situation like this.”
On Sunday evening, the Fed announced that it cut rates to a range of 0 to 0.25 percent and would inject huge sums into the economy by snapping up at least $500 billion of Treasury securities and at least $200 billion of mortgage-backed debt “over coming months.” The Fed also said banks would no longer have to stash customer deposits at the central bank and encouraged banks to use its discount window, which provides ready access to financing. Mr. Powell said the Fed was encouraging banks to use that money to lend to households and businesses.	On Sunday evening, the Fed announced that it cut rates to a range of 0 to 0.25 percent and would inject huge sums into the economy by snapping up at least $500 billion of Treasury securities and at least $200 billion of mortgage-backed debt “over coming months.” The Fed also said banks would no longer have to stash customer deposits at the central bank and encouraged banks to use its discount window, which provides ready access to financing. Mr. Powell said the Fed was encouraging banks to use that money to lend to households and businesses.
While the Dodd-Frank Act did take away some of the Fed’s tools, former regulators say the situation facing the economy today may not be best solved with the crisis-era measures that were used in 2008 and beyond. Instead, Congress and the White House may need to deploy other programs to help prop up affected industries.	While the Dodd-Frank Act did take away some of the Fed’s tools, former regulators say the situation facing the economy today may not be best solved with the crisis-era measures that were used in 2008 and beyond. Instead, Congress and the White House may need to deploy other programs to help prop up affected industries.
“There were a number of tools taken away that shouldn’t have been taken away,” said Ben S. Bernanke, who was the Federal Reserve chair during the 2008 financial crisis. “If they’re willing to rethink some of those things, that’s a good thing,” but most of the Fed’s use of such tools pertained to the financial sector “that doesn’t seem to be where the problem is now.”	“There were a number of tools taken away that shouldn’t have been taken away,” said Ben S. Bernanke, who was the Federal Reserve chair during the 2008 financial crisis. “If they’re willing to rethink some of those things, that’s a good thing,” but most of the Fed’s use of such tools pertained to the financial sector “that doesn’t seem to be where the problem is now.”
“In 2008 the problem was that major financial firms were facing runs,” he said, and therefore needed cash. “In this situation, the nonfinancial corporates are where the problem is — that is, think about an airline or a restaurant” that is unable to make payroll.	“In 2008 the problem was that major financial firms were facing runs,” he said, and therefore needed cash. “In this situation, the nonfinancial corporates are where the problem is — that is, think about an airline or a restaurant” that is unable to make payroll.
When it comes to preventing such disruptions, Mr. Bernanke said, “that is something, in the first line of defense, that Congress can do.”	When it comes to preventing such disruptions, Mr. Bernanke said, “that is something, in the first line of defense, that Congress can do.”
The Fed did some lending aimed at nonfinancial companies — including through its commercial paper funding facility and the Term Asset-Backed Securities Loan Facility, which helped meet household and small-business credit needs — and authority for those programs still exists. For corporate bailouts, Mr. Bernanke said, lawmakers should be the first line of defense.	The Fed did some lending aimed at nonfinancial companies — including through its commercial paper funding facility and the Term Asset-Backed Securities Loan Facility, which helped meet household and small-business credit needs — and authority for those programs still exists. For corporate bailouts, Mr. Bernanke said, lawmakers should be the first line of defense.
“It’s more democratic and accountable if Congress were to take the lead,” he said.	“It’s more democratic and accountable if Congress were to take the lead,” he said.
Henry M. Paulson Jr., who was President George W. Bush’s Treasury secretary in 2008, wrote in a Washington Post op-ed last week that one of the lessons from that crisis was that the executive branch might need more authority from Congress to take quick action.	Henry M. Paulson Jr., who was President George W. Bush’s Treasury secretary in 2008, wrote in a Washington Post op-ed last week that one of the lessons from that crisis was that the executive branch might need more authority from Congress to take quick action.
“Notwithstanding tensions between the parties and between the branches, it may be necessary to give the administration broad authority and flexibility to act, within the parameters and oversight structure set by the legislature,” Mr. Paulson wrote. “Congress can’t design and implement every stimulus program or turn on a dime to give new authorities to the executive when facts on the ground change.”	“Notwithstanding tensions between the parties and between the branches, it may be necessary to give the administration broad authority and flexibility to act, within the parameters and oversight structure set by the legislature,” Mr. Paulson wrote. “Congress can’t design and implement every stimulus program or turn on a dime to give new authorities to the executive when facts on the ground change.”
Hal Scott, an emeritus professor at Harvard Law School and the director of the nonprofit Committee on Capital Markets Regulation, said the Fed must restore its ability to be the world’s most powerful lender of last resort. It was unfortunate that such authorities needed to be reinstated amid a crisis, he said.	Hal Scott, an emeritus professor at Harvard Law School and the director of the nonprofit Committee on Capital Markets Regulation, said the Fed must restore its ability to be the world’s most powerful lender of last resort. It was unfortunate that such authorities needed to be reinstated amid a crisis, he said.
“It would have been better to do it before the crisis,” Mr. Scott said. “When you get into a crisis and you do it, there’s a concern that you’re sending a panic signal — that we’ve got to do this, we need this power.”	“It would have been better to do it before the crisis,” Mr. Scott said. “When you get into a crisis and you do it, there’s a concern that you’re sending a panic signal — that we’ve got to do this, we need this power.”
Even without renewed authorities, economists have widely speculated that the Fed could dust off its crisis-era playbook, reviving programs to help companies and financial institutions to weather the shock of the coronavirus. Michael Feroli, an economist at J.P. Morgan, has suggested that the Fed could use another program like the Term Asset-Backed Securities Loan Facility, or TALF, to help keep credit flowing to households and businesses because “the financial viability of some small businesses is a central concern right now.”	Even without renewed authorities, economists have widely speculated that the Fed could dust off its crisis-era playbook, reviving programs to help companies and financial institutions to weather the shock of the coronavirus. Michael Feroli, an economist at J.P. Morgan, has suggested that the Fed could use another program like the Term Asset-Backed Securities Loan Facility, or TALF, to help keep credit flowing to households and businesses because “the financial viability of some small businesses is a central concern right now.”
~~Updated June ~~16,~~ 2020~~	Updated June 22, 2020
	A commentary published this month on the website of the British Journal of Sports Medicine points out that covering your face during exercise “comes with issues of potential breathing restriction and discomfort” and requires “balancing benefits versus possible adverse events.” Masks do alter exercise, says Cedric X. Bryant, the president and chief science officer of the American Council on Exercise, a nonprofit organization that funds exercise research and certifies fitness professionals. “In my personal experience,” he says, “heart rates are higher at the same relative intensity when you wear a mask.” Some people also could experience lightheadedness during familiar workouts while masked, says Len Kravitz, a professor of exercise science at the University of New Mexico.
The steroid, dexamethasone, is the first treatment shown to reduce mortality in severely ill patients, according to scientists in Britain. The drug appears to reduce inflammation caused by the immune system, protecting the tissues. In the study, dexamethasone reduced deaths of patients on ventilators by one-third, and deaths of patients on oxygen by one-fifth.	The steroid, dexamethasone, is the first treatment shown to reduce mortality in severely ill patients, according to scientists in Britain. The drug appears to reduce inflammation caused by the immune system, protecting the tissues. In the study, dexamethasone reduced deaths of patients on ventilators by one-third, and deaths of patients on oxygen by one-fifth.
The coronavirus emergency relief package gives many American workers paid leave if they need to take time off because of the virus. It gives qualified workers two weeks of paid sick leave if they are ill, quarantined or seeking diagnosis or preventive care for coronavirus, or if they are caring for sick family members. It gives 12 weeks of paid leave to people caring for children whose schools are closed or whose child care provider is unavailable because of the coronavirus. It is the first time the United States has had widespread federally mandated paid leave, and includes people who don’t typically get such benefits, like part-time and gig economy workers. But the measure excludes at least half of private-sector workers, including those at the country’s largest employers, and gives small employers significant leeway to deny leave.	The coronavirus emergency relief package gives many American workers paid leave if they need to take time off because of the virus. It gives qualified workers two weeks of paid sick leave if they are ill, quarantined or seeking diagnosis or preventive care for coronavirus, or if they are caring for sick family members. It gives 12 weeks of paid leave to people caring for children whose schools are closed or whose child care provider is unavailable because of the coronavirus. It is the first time the United States has had widespread federally mandated paid leave, and includes people who don’t typically get such benefits, like part-time and gig economy workers. But the measure excludes at least half of private-sector workers, including those at the country’s largest employers, and gives small employers significant leeway to deny leave.
So far, the evidence seems to show it does. A widely cited paper published in April suggests that people are most infectious about two days before the onset of coronavirus symptoms and estimated that 44 percent of new infections were a result of transmission from people who were not yet showing symptoms. Recently, a top expert at the World Health Organization stated that transmission of the coronavirus by people who did not have symptoms was “very rare,” but she later walked back that statement.	So far, the evidence seems to show it does. A widely cited paper published in April suggests that people are most infectious about two days before the onset of coronavirus symptoms and estimated that 44 percent of new infections were a result of transmission from people who were not yet showing symptoms. Recently, a top expert at the World Health Organization stated that transmission of the coronavirus by people who did not have symptoms was “very rare,” but she later walked back that statement.
Touching contaminated objects and then infecting ourselves with the germs is not typically how the virus spreads. But it can happen. A number of studies of flu, rhinovirus, coronavirus and other microbes have shown that respiratory illnesses, including the new coronavirus, can spread by touching contaminated surfaces, particularly in places like day care centers, offices and hospitals. But a long chain of events has to happen for the disease to spread that way. The best way to protect yourself from coronavirus — whether it’s surface transmission or close human contact — is still social distancing, washing your hands, not touching your face and wearing masks.	Touching contaminated objects and then infecting ourselves with the germs is not typically how the virus spreads. But it can happen. A number of studies of flu, rhinovirus, coronavirus and other microbes have shown that respiratory illnesses, including the new coronavirus, can spread by touching contaminated surfaces, particularly in places like day care centers, offices and hospitals. But a long chain of events has to happen for the disease to spread that way. The best way to protect yourself from coronavirus — whether it’s surface transmission or close human contact — is still social distancing, washing your hands, not touching your face and wearing masks.
A study by European scientists is the first to document a strong statistical link between genetic variations and Covid-19, the illness caused by the coronavirus. Having Type A blood was linked to a 50 percent increase in the likelihood that a patient would need to get oxygen or to go on a ventilator, according to the new study.	A study by European scientists is the first to document a strong statistical link between genetic variations and Covid-19, the illness caused by the coronavirus. Having Type A blood was linked to a 50 percent increase in the likelihood that a patient would need to get oxygen or to go on a ventilator, according to the new study.
The unemployment rate fell to 13.3 percent in May, the Labor Department said on June 5, an unexpected improvement in the nation’s job market as hiring rebounded faster than economists expected. Economists had forecast the unemployment rate to increase to as much as 20 percent, after it hit 14.7 percent in April, which was the highest since the government began keeping official statistics after World War II. But the unemployment rate dipped instead, with employers adding 2.5 million jobs, after more than 20 million jobs were lost in April.	The unemployment rate fell to 13.3 percent in May, the Labor Department said on June 5, an unexpected improvement in the nation’s job market as hiring rebounded faster than economists expected. Economists had forecast the unemployment rate to increase to as much as 20 percent, after it hit 14.7 percent in April, which was the highest since the government began keeping official statistics after World War II. But the unemployment rate dipped instead, with employers adding 2.5 million jobs, after more than 20 million jobs were lost in April.
Mass protests against police brutality that have brought thousands of people onto the streets in cities across America are raising the specter of new coronavirus outbreaks, prompting political leaders, physicians and public health experts to warn that the crowds could cause a surge in cases. While many political leaders affirmed the right of protesters to express themselves, they urged the demonstrators to wear face masks and maintain social distancing, both to protect themselves and to prevent further community spread of the virus. Some infectious disease experts were reassured by the fact that the protests were held outdoors, saying the open air settings could mitigate the risk of transmission.
States are reopening bit by bit. This means that more public spaces are available for use and more and more businesses are being allowed to open again. The federal government is largely leaving the decision up to states, and some state leaders are leaving the decision up to local authorities. Even if you aren’t being told to stay at home, it’s still a good idea to limit trips outside and your interaction with other people.	States are reopening bit by bit. This means that more public spaces are available for use and more and more businesses are being allowed to open again. The federal government is largely leaving the decision up to states, and some state leaders are leaving the decision up to local authorities. Even if you aren’t being told to stay at home, it’s still a good idea to limit trips outside and your interaction with other people.
Common symptoms include fever, a dry cough, fatigue and difficulty breathing or shortness of breath. Some of these symptoms overlap with those of the flu, making detection difficult, but runny noses and stuffy sinuses are less common. The C.D.C. has also added chills, muscle pain, sore throat, headache and a new loss of the sense of taste or smell as symptoms to look out for. Most people fall ill five to seven days after exposure, but symptoms may appear in as few as two days or as many as 14 days.	Common symptoms include fever, a dry cough, fatigue and difficulty breathing or shortness of breath. Some of these symptoms overlap with those of the flu, making detection difficult, but runny noses and stuffy sinuses are less common. The C.D.C. has also added chills, muscle pain, sore throat, headache and a new loss of the sense of taste or smell as symptoms to look out for. Most people fall ill five to seven days after exposure, but symptoms may appear in as few as two days or as many as 14 days.
If air travel is unavoidable, there are some steps you can take to protect yourself. Most important: Wash your hands often, and stop touching your face. If possible, choose a window seat. A study from Emory University found that during flu season, the safest place to sit on a plane is by a window, as people sitting in window seats had less contact with potentially sick people. Disinfect hard surfaces. When you get to your seat and your hands are clean, use disinfecting wipes to clean the hard surfaces at your seat like the head and arm rest, the seatbelt buckle, the remote, screen, seat back pocket and the tray table. If the seat is hard and nonporous or leather or pleather, you can wipe that down, too. (Using wipes on upholstered seats could lead to a wet seat and spreading of germs rather than killing them.)	If air travel is unavoidable, there are some steps you can take to protect yourself. Most important: Wash your hands often, and stop touching your face. If possible, choose a window seat. A study from Emory University found that during flu season, the safest place to sit on a plane is by a window, as people sitting in window seats had less contact with potentially sick people. Disinfect hard surfaces. When you get to your seat and your hands are clean, use disinfecting wipes to clean the hard surfaces at your seat like the head and arm rest, the seatbelt buckle, the remote, screen, seat back pocket and the tray table. If the seat is hard and nonporous or leather or pleather, you can wipe that down, too. (Using wipes on upholstered seats could lead to a wet seat and spreading of germs rather than killing them.)
Taking one’s temperature to look for signs of fever is not as easy as it sounds, as “normal” temperature numbers can vary, but generally, keep an eye out for a temperature of 100.5 degrees Fahrenheit or higher. If you don’t have a thermometer (they can be pricey these days), there are other ways to figure out if you have a fever, or are at risk of Covid-19 complications.
The C.D.C. has recommended that all Americans wear cloth masks if they go out in public. This is a shift in federal guidance reflecting new concerns that the coronavirus is being spread by infected people who have no symptoms. Until now, the C.D.C., like the W.H.O., has advised that ordinary people don’t need to wear masks unless they are sick and coughing. Part of the reason was to preserve medical-grade masks for health care workers who desperately need them at a time when they are in continuously short supply. Masks don’t replace hand washing and social distancing.
If you’ve been exposed to the coronavirus or think you have, and have a fever or symptoms like a cough or difficulty breathing, call a doctor. They should give you advice on whether you should be tested, how to get tested, and how to seek medical treatment without potentially infecting or exposing others.	If you’ve been exposed to the coronavirus or think you have, and have a fever or symptoms like a cough or difficulty breathing, call a doctor. They should give you advice on whether you should be tested, how to get tested, and how to seek medical treatment without potentially infecting or exposing others.
If you’re sick and you think you’ve been exposed to the new coronavirus, the C.D.C. recommends that you call your healthcare provider and explain your symptoms and fears. They will decide if you need to be tested. Keep in mind that there’s a chance — because of a lack of testing kits or because you’re asymptomatic, for instance — you won’t be able to get tested.	If you’re sick and you think you’ve been exposed to the new coronavirus, the C.D.C. recommends that you call your healthcare provider and explain your symptoms and fears. They will decide if you need to be tested. Keep in mind that there’s a chance — because of a lack of testing kits or because you’re asymptomatic, for instance — you won’t be able to get tested.
That could also include a Fed program to help corporations that issue short-term debt as a source of funding, known as commercial paper.	That could also include a Fed program to help corporations that issue short-term debt as a source of funding, known as commercial paper.
Krishna Guha and Ernie Tedeschi at Evercore ISI, an investment banking advisory firm, now expect the Fed to add a commercial paper funding facility “to what we see as an imminent super-aggressive package of measures to mitigate the virus shock and stabilize fixed income and credit markets.”	Krishna Guha and Ernie Tedeschi at Evercore ISI, an investment banking advisory firm, now expect the Fed to add a commercial paper funding facility “to what we see as an imminent super-aggressive package of measures to mitigate the virus shock and stabilize fixed income and credit markets.”