This article is from the source 'nytimes' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.
You can find the current article at its original source at https://www.nytimes.com/2020/04/08/business/economy/fed-emergency-rate-cuts-minutes.html
The article has changed 15 times. There is an RSS feed of changes available.
| Version 4 | Version 5 |
|---|---|
| Fed Emergency Rate Cuts Came as Economy Turned ‘Profoundly Uncertain’ | Fed Emergency Rate Cuts Came as Economy Turned ‘Profoundly Uncertain’ |
| (3 days later) | |
| Federal Reserve officials found themselves staring down a “profoundly uncertain” economic outlook, on top of a financial market meltdown, when they chose to slash interest rates to near zero in mid-March. | Federal Reserve officials found themselves staring down a “profoundly uncertain” economic outlook, on top of a financial market meltdown, when they chose to slash interest rates to near zero in mid-March. |
| Minutes from the Fed’s March 15 meeting, released on Wednesday, offer a glimpse at the conversations behind the central bank’s early response to economic fallout from the coronavirus. Officials had made an emergency rate cut — their first since 2008 — just weeks earlier at an unscheduled March 3 meeting. They followed that up by slashing borrowing costs to rock-bottom on a Sunday evening while rolling out a giant bond-purchasing program aimed at calming troubled markets. | Minutes from the Fed’s March 15 meeting, released on Wednesday, offer a glimpse at the conversations behind the central bank’s early response to economic fallout from the coronavirus. Officials had made an emergency rate cut — their first since 2008 — just weeks earlier at an unscheduled March 3 meeting. They followed that up by slashing borrowing costs to rock-bottom on a Sunday evening while rolling out a giant bond-purchasing program aimed at calming troubled markets. |
| “All participants viewed the near-term U.S. economic outlook as having deteriorated sharply in recent weeks and as having become profoundly uncertain,” according to minutes from the meeting. Officials also “noted that financial markets had exhibited extraordinary turbulence and stresses.” | “All participants viewed the near-term U.S. economic outlook as having deteriorated sharply in recent weeks and as having become profoundly uncertain,” according to minutes from the meeting. Officials also “noted that financial markets had exhibited extraordinary turbulence and stresses.” |
| The Fed’s March move came as mounting concerns about potential economic devastation from the coronavirus thrust Wall Street into turmoil, causing trading in usually deep and liquid markets — including that for Treasury securities — to gum up. The minutes underline that the financial disorder, paired with uncertainty about the broader economic outlook, drove officials to act. | The Fed’s March move came as mounting concerns about potential economic devastation from the coronavirus thrust Wall Street into turmoil, causing trading in usually deep and liquid markets — including that for Treasury securities — to gum up. The minutes underline that the financial disorder, paired with uncertainty about the broader economic outlook, drove officials to act. |
| Fed policymakers saw a “major downside risk that the spread of the virus might intensify in those areas of the country currently less affected, thereby sidelining many more U.S. workers and further damping purchases by consumers,” the minutes showed. | Fed policymakers saw a “major downside risk that the spread of the virus might intensify in those areas of the country currently less affected, thereby sidelining many more U.S. workers and further damping purchases by consumers,” the minutes showed. |
| Central bank staff reported that “concerns about the coronavirus outbreak dominated” markets, that rates on government securities had “plummeted” and that volatility had “soared.” The market for short-term loans to businesses was “nearly nonexistent.” | Central bank staff reported that “concerns about the coronavirus outbreak dominated” markets, that rates on government securities had “plummeted” and that volatility had “soared.” The market for short-term loans to businesses was “nearly nonexistent.” |
| Even with that grim backdrop, a “few” participants at the meeting would have preferred to cut interest rates less drastically, favoring a half-point reduction over the full percentage point move the Fed ultimately made. They wanted to preserve room to lower rates later and worried that a big cut “ran the risk of sending an overly negative signal about the economic outlook,” among other considerations, according to the minutes. | Even with that grim backdrop, a “few” participants at the meeting would have preferred to cut interest rates less drastically, favoring a half-point reduction over the full percentage point move the Fed ultimately made. They wanted to preserve room to lower rates later and worried that a big cut “ran the risk of sending an overly negative signal about the economic outlook,” among other considerations, according to the minutes. |
| Loretta Mester, the president of the Federal Reserve Bank of Cleveland, has a vote on monetary policy this year and dissented from the move. Only 12 of the Fed’s 17 officials hold a vote at any given time, with the regional presidents rotating in and out. | Loretta Mester, the president of the Federal Reserve Bank of Cleveland, has a vote on monetary policy this year and dissented from the move. Only 12 of the Fed’s 17 officials hold a vote at any given time, with the regional presidents rotating in and out. |
| Jerome H. Powell, the Fed chair, and his colleagues have remained active since the March rate cuts. On March 23, the central bank made its bond-buying program explicitly unlimited and broadened what it was willing to purchase, adding commercial mortgage-backed securities issued by government agencies. It expanded its balance sheet by about $1.6 trillion in March alone, so that it now totals about $6 trillion. | Jerome H. Powell, the Fed chair, and his colleagues have remained active since the March rate cuts. On March 23, the central bank made its bond-buying program explicitly unlimited and broadened what it was willing to purchase, adding commercial mortgage-backed securities issued by government agencies. It expanded its balance sheet by about $1.6 trillion in March alone, so that it now totals about $6 trillion. |
| The central bank has unveiled emergency lending programs in partnership with the Treasury Department to keep credit flowing, including programs that will buy corporate bonds and short-term business debt. It has announced that it will roll out a Main Street lending program, which is meant to target businesses that are not served by government small-business support programs. | The central bank has unveiled emergency lending programs in partnership with the Treasury Department to keep credit flowing, including programs that will buy corporate bonds and short-term business debt. It has announced that it will roll out a Main Street lending program, which is meant to target businesses that are not served by government small-business support programs. |
| Details on that program, which have been scant so far, are expected this week. Treasury Secretary Steven Mnuchin said in a CNBC interview on Wednesday that he has been talking with Mr. Powell daily and that “we hope to have an announcement this week with details on that and get it up and running as soon as we can.” | Details on that program, which have been scant so far, are expected this week. Treasury Secretary Steven Mnuchin said in a CNBC interview on Wednesday that he has been talking with Mr. Powell daily and that “we hope to have an announcement this week with details on that and get it up and running as soon as we can.” |
| Congress has given the Treasury Department $454 billion to support the Fed’s emergency programs by insuring against losses. That pot of money could support more than $4 trillion in lending and bond buying, depending on how much protection the central bank demands to cover credit risk. | Congress has given the Treasury Department $454 billion to support the Fed’s emergency programs by insuring against losses. That pot of money could support more than $4 trillion in lending and bond buying, depending on how much protection the central bank demands to cover credit risk. |
| The key question now is how fast those programs, which are legally and logistically complex, can get going. | The key question now is how fast those programs, which are legally and logistically complex, can get going. |
| Updated June 12, 2020 | |
| 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. | |
| 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. |
| 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. | 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. |
| Exercise researchers and physicians have some blunt advice for those of us aiming to return to regular exercise now: Start slowly and then rev up your workouts, also slowly. American adults tended to be about 12 percent less active after the stay-at-home mandates began in March than they were in January. But there are steps you can take to ease your way back into regular exercise safely. First, “start at no more than 50 percent of the exercise you were doing before Covid,” says Dr. Monica Rho, the chief of musculoskeletal medicine at the Shirley Ryan AbilityLab in Chicago. Thread in some preparatory squats, too, she advises. “When you haven’t been exercising, you lose muscle mass.” Expect some muscle twinges after these preliminary, post-lockdown sessions, especially a day or two later. But sudden or increasing pain during exercise is a clarion call to stop and return home. | Exercise researchers and physicians have some blunt advice for those of us aiming to return to regular exercise now: Start slowly and then rev up your workouts, also slowly. American adults tended to be about 12 percent less active after the stay-at-home mandates began in March than they were in January. But there are steps you can take to ease your way back into regular exercise safely. First, “start at no more than 50 percent of the exercise you were doing before Covid,” says Dr. Monica Rho, the chief of musculoskeletal medicine at the Shirley Ryan AbilityLab in Chicago. Thread in some preparatory squats, too, she advises. “When you haven’t been exercising, you lose muscle mass.” Expect some muscle twinges after these preliminary, post-lockdown sessions, especially a day or two later. But sudden or increasing pain during exercise is a clarion call to stop and return home. |
| 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. | 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. | 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. |
| The Fed’s commercial paper program, which will support the market for short-term business loans, was announced March 17 and is expected to be up and running April 14. Its corporate bond-buying programs, announced March 23, are still a few weeks away, Charles L. Evans, the president of the Federal Reserve Bank of Chicago, said in a virtual discussion with the Economic Club of Chicago on Wednesday. | The Fed’s commercial paper program, which will support the market for short-term business loans, was announced March 17 and is expected to be up and running April 14. Its corporate bond-buying programs, announced March 23, are still a few weeks away, Charles L. Evans, the president of the Federal Reserve Bank of Chicago, said in a virtual discussion with the Economic Club of Chicago on Wednesday. |
| There are also questions surrounding whom the programs will help. The Fed is expected to unveil additional efforts to assist state and local governments, and companies with less-than-perfect bond ratings are pushing to get some relief. | There are also questions surrounding whom the programs will help. The Fed is expected to unveil additional efforts to assist state and local governments, and companies with less-than-perfect bond ratings are pushing to get some relief. |
| The Fed’s programs could allow bigger companies to access the financing they need to make it through the coming weeks and months without shedding employees. Even with the support, the economy is expected to experience a deep shock — the central bank’s goal is to put it in place to snap back once the virus abates and Americans can return to work. | The Fed’s programs could allow bigger companies to access the financing they need to make it through the coming weeks and months without shedding employees. Even with the support, the economy is expected to experience a deep shock — the central bank’s goal is to put it in place to snap back once the virus abates and Americans can return to work. |
| The economy “will be less prosperous coming out of this crisis than we were going into it,” Mr. Evans said Wednesday. | The economy “will be less prosperous coming out of this crisis than we were going into it,” Mr. Evans said Wednesday. |
| Alan Rappeport contributed reporting. | Alan Rappeport contributed reporting. |