Friday, March 20, 2020

Now Federal Reserve Propping Up the Municipal Bond Market

Yet another financial sector that is going to be propped up by the Federal Reserve.

The Federal Reserve has just announced it is now going to support the US municipal bond market.

 According to a statement from the Fed’s board of governors, the central bank has “expanded its program of support for the flow of credit to the economy by taking steps to enhance the liquidity and functioning of crucial state and municipal money markets.”

The Fed is just propping up everything in sight, while some of this will only be paper shuffling, there is going to be a tremendous amount of new money that leaks into the system.

It is difficult to see how on the other side of this panic we don't get a massive acceleration in price inflation.


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