Unlimited QE and Why Markets Can't Price In COVID-19

The Market reacts as the Fed announced effectively unlimited injections including a new array of direct asset purchase tools

AccessTimeIconMar 23, 2020 at 7:00 p.m. UTCUpdated Sep 14, 2021 at 8:21 a.m. UTC
AccessTimeIconMar 23, 2020 at 7:00 p.m. UTCUpdated Sep 14, 2021 at 8:21 a.m. UTC

The market reacts as the U.S. Federal Reserve announced effectively unlimited capital injections including a new array of direct asset purchase tools.

For more episodes and free early access before our regular 3 p.m. Eastern time releases, subscribe with Apple Podcasts, Spotify, Pocketcasts, Google Podcasts, Castbox, Stitcher, RadioPublica, IHeartRadio or RSS.

Last October, Ikigai Asset Management’s Travis Kling predicted central banks would have to “juice QE to infinity” in order to save markets from recession. Yesterday on "60 Minutes," Fed President Neel Kashkari said that“there is an infinite amount of cash at the Federal Reserve. We will do whatever we need to do to make sure there is enough cash in the financial system.” 

This was followed this morning by an announcement the Fed was giving itself effectively unlimited capacity to intervene in markets. Markets were...still not impressed. In less than two hours, an initial gain had entirely retraced. 

On this episode of The Breakdown, @NLW looks at:

  • Specifics details of the Fed Announcement
  • Why FinTwit and Bitcoin Twitter are focusing on inflation 
  • Why some think this action amounts to a nationalization of markets
  • How the "money printer go brrr’ meme is taking hold

For more episodes and free early access before our regular 3 p.m. Eastern time releases, subscribe with Apple Podcasts, Spotify, Pocketcasts, Google Podcasts, Castbox, Stitcher, RadioPublica, IHeartRadio or RSS.

DISCLOSURE

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.

Trending

1
CoinDesk - Unknown
Three Arrows Paper Trail Leads to Trading Desk Obscured Via Offshore Entities

As Three Arrows Capital collapsed under market pressure, its much-lesser known trading desk, TPS Capital, remained active, sources say. But a complex ownership structure might frustrate creditors' efforts to collect.

CoinDesk - Unknown
2
CoinDesk - Unknown
June Was Bitcoin’s Worst Month Ever

Plus, European crypto regulation comes into view.

CoinDesk - Unknown
3
CoinDesk - Unknown
What Traders Are Saying About Bitcoin's Biggest Monthly Loss in 11 Years

Poor macroeconomic sentiment, fears of inflation and systemic risks from the crypto market pushed the cryptocurrency below 2017’s highs.

CoinDesk - Unknown
4
CoinDesk - Unknown
Three Arrows Capital Files for Bankruptcy in New York Tied to British Virgin Islands Proceeding

A British Virgin Islands court ordered Three Arrows' BVI branch into liquidation earlier this week.

CoinDesk - Unknown