tyb
On Thursday, the Federal Reserve noticed the market jamming up and decided to step in with an infusion of cash available to banks. The New York Fed said it was injecting the money “to address the highly unusual disruptions to Treasury financing markets associated with the coronavirus outbreak.”
Treasurys — U.S. government debt — are typically widely traded. They’re the grease that makes the wheels of the credit and trading system function efficiently. But in recent days, the Treasury market has become brittle.
Treasurys “are the most liquid market on the planet bar none,” said Gennadiy Goldberg, U.S. rates strategist for TD Securities. “When it’s experiencing problems, you know something is wrong.”
Normally, when there’s a big stock sell-off, investors flee for the safety of U.S. Treasurys. And during the market sell-offs recently, it’s exactly what has been happening.
Except on Thursday.
Goldberg said the trading system was sputtering. Dealers — the banks that buy and sell under all conditions — didn’t have robust enough balance sheets to meet the demand from buyers and sellers of Treasurys.
So trading markets faltered, Goldberg said. The Fed stepped in to prevent a case of the hiccups from becoming something drastically worse.
The Fed also announced a move reminiscent of dramatic actions it took during and immediately after the financial crisis of 2008. It’s called quantitative easing and it’s meant to relieve the cash liquidity imbalances in the financial markets.
During the crisis, for instance, the Fed bought massive amounts of Treasury debt from banks, flooding the financial system with money.
Now, the Fed is doing something similar — though, so far, on a much smaller scale. As of Friday, it will be purchasing $60 billion in Treasury debt.
And next week, at its regular meeting, the Fed is expected to slash interest rates — perhaps by as much as a full percentage point — which would essentially bring them down to zero. The central bank already cut rates by a half point in an emergency move last week.
All these actions are designed to support both the financial system and the broader economy from the sudden stress brought on by the coronavirus.
https://www.opb.org/news/article/npr-somethings-wrong-stock-sell-off-exposes-weak-links-in-financial-system/
a little busy…
Pray
o7
The Israeli government is set to announce further widespread and stringent measures to try to contain the spread of the new coronavirus, including transitioning staff at workplaces deemed non-essential to work from home, and further limiting public gatherings and movement. The raft of new measures, in addition to those already in force, are likely to paralyze up to 50 percent of the Israeli economy, TV reports said Friday night.
Prime Minister Benjamin Netanyahu sat Friday with top ministers and advisers working on the next steps and was expected to make the announcements on Saturday night, Hebrew media reported. However, Israel was expected to stop short of declaring a state of emergency or imposing curfews.
Among the steps being discussed were ordering non-essential workers to work from home, limitations or bans on public transport, shutting preschools and creches, limiting access to some malls and shutting others. Some government workers will also be shifted to working from home. Reports said officials were working to determine how many Israeli workers would be classified as non-essential.
The government was also considering releasing prisoners with light sentences to reduce prison crowding.
Despite the devastating effects to the economy, officials have repeatedly promised that there will be no food shortages, and Prime Minister Benjamin Netanyahu said Friday there was “no reason to storm the supermarkets.”
“We are investing considerable means right now to increase the pace of testing, to reduce the infection rate and – of course – to reinforce, strengthen and safeguard the medical teams, as well as many other things,” Netanyahu said after the Friday meeting.
“There will be enough food in general and for the (upcoming Passover) holiday,” Netanyahu said.
Like many other places in the world, Israelis have been stocking up on supplies, fearing extended periods of quarantine, lockdown orders, or shortages.
Further financial steps were being planned to help people affected by the crisis, lost work and shut businesses, reports said, including easing criteria for unemployment benefits. Banks would also be encouraged to ease terms for loan repayments.
Channel 12 said Israel was also considering reducing or barring the entry of Palestinian workers from the West Bank and would consider giving the Palestinian Authority some kind of financial compensation to ensure the Palestinian economy did not collapse.
Israel has already closed universities and schools across the country.
Israel has taken a number of far-reaching measures to contain and fight the virus, but has so far stopped short of steps such as banning all non-essential domestic travel or ordering the closure of most businesses.
All Israelis returning from overseas are required to quarantine at home for 14 days. Non-Israeli nationals were barred from entering the country as of Thursday at 8 p.m., unless they can demonstrate an ability to self-quarantine for two weeks. Some 35,000 Israelis are said to be in quarantine. Three Israelis are seriously ill with the virus, and almost 150 have tested positive. Nobody has died.
Any public gatherings of over 100 people have been banned, leading to the cancellation of sports games and numerous other events, as well as the closure of theaters and many hotels.
That order, which went into effect Thursday, applies to weddings, bar mitzvahs and funerals, and covers “both closed and open spaces,” according to the Health Ministry.
The regulation has also impacted religious life, with Chief Sephardic Rabbi Yitzhak Yosef on Thursday calling on Israelis to avoid large prayer gatherings at the Western Wall and saying Health Ministry directives should be treated as Jewish law “for all intents and purposes.”
Police announced Friday they were carrying out hundreds of inspections to ensure compliance with the ban on gatherings of over 100 people.
Across the world, authorities have canceled sporting events, theater productions, TV show tapings, concerts and anything that draws a crowd in a frantic effort to keep the virus from spreading in places where people congregate.
https://www.timesofisrael.com/israel-set-for-drastic-restrictions-on-workplaces-gatherings-no-lockdown-yet/?utm_source=israel-set-for-drastic-restrictions-on-workplaces-gatherings-no-lockdown-yet&utm_medium=desktop-browser&utm_campaign=desktop-notifications