The Wall Street Journal reports Negotiators Nearing Accord on U.S. Stimulus Package to Combat Coronavirus but specific details are still up in the air.
Top lawmakers and the Trump administration closed in on completing a colossal stimulus package, worth at least $1.6 trillion, designed to shield the U.S. economy from the most drastic consequences of the coronavirus pandemic. “I believe we’re on the 5-yard line,” said Senate Majority Leader Mitch McConnell (R., Ky.) on the Senate floor. “I hope today is the day this body will get it done.”
Treasury Secretary Steven Mnuchin, who has led the negotiations for Republicans, said on Tuesday morning that he expected a deal. He and Mr. Schumer completed a round of late-night talks Monday predicting they could soon finalize an agreement, which Mr. Schumer said could run to $2 trillion.
The two sides were approaching an agreement on one of the primary remaining sticking points: oversight on $500 billion that Republicans had proposed to allocate to aid distressed businesses. Democrats had sought controls on those funds, which include loans made directly by the Treasury Department and a backstop for losses in Federal Reserve lending facilities.
Stop the Nonsense
I agree with Trump on the nonsense.
So how many pages will there be to this bill, and what’s on the pages?
Meanwhile, Wall Street loves the bailout, no matter what it is. THe DOW is up about 8% , with the Nasdaq up 5%, and the S&P 6.5%.
Gold is up another $87 to $1654.
Is Everybody Happy?
Not quite. especially the 5-year note. The 5-year yield is up 11 basis points to 0.51%. The 10-year note is is at 0.82% and the 30-year bond yield is 1.39% up 4 basis points.
Mike “Mish” Shedlock
What’s the saying? Something like “don’t let a good crisis go to waste”?
Seems like people have two options:
or
Total public debt outstanding on January 20, 2017 = $19,947,304,555,212.49
Total public debt outstandiung today = $23,514,534,990,918.53
By tthe time Trump’s first term is up that will be AT LEAST $27 trillion, in 48 months we will have added 7 trillion. More than $14.583 billion per month every month of his tenure.
So, the far right that so desparately wants fiscal rectitude now has to admit Obama was a far better president in that regard. In fact nobody could possible be worse than Trump.
Sorry, the edit function is nt working again, I missed a decemal place, that should read $145.833 billion per MONTH. 🙂
DECIMAL…. What is wrong with me today?
Well so did 62 million other people, but can you even wrap your head around how quickly and quietly they simply dumped the notion of balancing the books? Because deficits are only bad when democrats do them, taxes are only bad when democrats pass them. At this point I am not sure what passes for brains in the GOP but I am pretty sure it smells like it just fell out of a diaper.
One moment Mish, if the market cap is around 50-60 trillion for all equities and it soared by 11% in one day that means something like $6 TRILLION was plowed into stocks just today.
Now who do you know that has that kind of cash just sitting around waiting to buy stocks?
Todasy was all about Fed intervention and the blinding flash of every bit of Fed power to nuke the market with money. Of course the middle and lower classes WILL pay for all of this eventually via unmeasured and unreported hyperinflation. But, at least they will not run out of toilet paper for about 5 years.
A lot but not trillions.
Scooot this is an interesting question for me, one I used to think about quite a lot back when I was in college in the 90’s to get my degree in finance. That is the relationship between points on the Dow (and other indexes) and market cap. But, back then market cap information was easy to get. The NYSE and DJIA websites used to publish the data, on the front page, later they buried that information but it was still available with some poking around. Now you have to have something like a Bloomberg terminal with paid subscription to find good up to date market caps. And, they seem to have changed the way they do the weighting so that the companies in the indexes do not at any given time represent the index’s true value. In short there was no real way to know what an idex market cap is unless you actually had a spreadsheet with every single issuer of stock listed times the number of shares issued, times the price at a moment in time.
So, the resource you shared is a good tool and Thank You for it, but, it is not a complete tool, it is a snapshot of one index, and it shows the change but here, I am posting the fine print at the bottom of the page because I for one had a hard time reading it, the font is so small:
“Notional Value”, which is also referred to as “Dollar Value Traded”, is calculated by multiplying the execution price of each transaction by the total number of shares executed in each transaction. This method of calculating market share, as opposed to simply using the total number of shares that traded hands, can be a better representation of the actual “size” of a market. The larger the Notional Value traded, the more risk that actually changed hands. By way of example, 100 shares of stock ABC at $362 per share is a much larger transaction than 100 shares of stock XYZ at $2.20 a share. Other assets classes, such as futures and options, and most other equity markets outside of the U.S., historically have used Notional Value as an index into how much activity takes place on those markets. Cboe is the first to offer a real-time view, market-wide, into Notional Value traded in the U.S. cash equity markets.
This like I said is a good tool, but it is not the market cap change each day. When the financial media says equities rose by 11% in one day such as it did last week, you have to expect that what that means is that the market CAPITALIZATION increased by 11%. That is the only fair interpretation of that characterization. If it actually means that an index such as the DJIA went from say 17,000 to 18,870 than that does not represent the increase in the equity market cap.
What I am saying is that if you want to know what the change in the market cap for all US equities in all indexes (except the penny exchange in Denver) you have to have an opening bell amount to compare to a closing bell amount, you cannot tell by points, because there is no real relationship in the points a market gained and the change in the capitalization for the day. So, when they put the headline on TV that the Dow was up 2,000 points and that is 11% as you can see that means basically nothing about market cap. It is a disingenuous reading for sure and leaves us guessing. By the way, when did they first start to bury the market cap so you had to dig for it? The same time in the very late 90’s they started to front run client bids with thousands of times the volume per day using quants and algos to computer trade and hold for tiny fractions of a second.
I was very interested in the relationship between points and market cap in college, I even looked at it as something I might want to do a masters thesis on, till I started loking closer at the math involved which is not my favorite part of Finance and Economics. Besides, I was more interested in areas that impacted people’s daily lives more directly like the relationship between income and the price of shelter. And I did write a paper on that which got a medium grade and I could tell the prof was being generous because while the ideas were sound he thought my conclusion was wrong. House prices could never really drop as I predicted they had to. That was the 90’s and I was correct in my conclusion, but, it took another 11 years or so. I wonder if he is still alive and thought about my paper when the GFC happened.
I’m gonna go out on a limb and say the national debt will be 35t in 36 months. How it plays out from there is beyond me but they’re right when they say life is not going to be the same from here on.
We’re early in this crisis (both health and financial) and it’s hard to see how throwing buckets of counterfeit money at this problem is going to make anything better. But today Wall Street gamblers were sent stampeding like lemmings.
Does PETA know about this QE?
Here’s an idea for Trump:
Prove to everyone on the planet that you have 50 lb cast-iron balls swinging below a johnson to rival Moe Biggsley.
Take 12 hours and have your staff read the whole thing and create an itemized list that shows each garbage provision along with a sentence explaining why it’s garbage.
Hold a very large very public press conference where you go over each item, and then veto the the bill on camera and send it back.
Make them override it or change it.
OMG DBG I had never heard of Moe Biggsley and his Johnson so I had to Google it to see what you referred to. I am going to need to burn my computer before I cross the Florida state line next week when I move there. There is not enough bleach in Walmart to clean those images out of my eyes, well there has been no bleach in Walmart here since March 3rd anyway but you know what I mean.
Hahahahaha
OMG
One of the guys on my team got a video when we were deployed. After we stopped laughing, Moe became the stick against which all others were measured 🤣
Good luck in Florida brother. Happy to hear you got everything worked out.
Everyone wants to be a capitalist until it’s time to do what capitalists do. When that time comes the rich turn to socialists as fast as dollars can be printed. Who are the republicans and democrats and capitalists kidding? Only themselves. Karl Marx is laughing in his grave.
You know none of the “Kings/queens of industry” in this country are real capitalists right?
The best you could call them is “crony” but most – if not all – are just plain socialists.
Trump will cave as usual. He’ll sign any piece of garbage bill that lands on his desk.
Fire up the bubbles.
Just keep one thing in mind…. There are far more horse’s asses in Washington than there are horses.
“A major sticking point has been a $500 billion fund, demanded by Republicans, to backstop loans and other guarantees extended to the large industries hit hardest by the crisis, including the airline and cruise line companies. Democrats want strings attached to that lending to ensure that taxpayer dollars aren’t used for stock buybacks or CEO compensation, and to protect the employees of those companies from being laid off.”
Oh the horror of demanding terms on the industries we bail out with taxpayer dollars! What are those Evil Democrats thinking???
Buy the rumor, Sell the news?
How long after stimpack in rear view mirror before tantrums begin (again)?
Ahahaha..it’s not about the stimulus–it’s the low-info buy-the-dip see Trump pushing to restart the economy no later than China does (opening up Hubei and Wuhan in the next week or so). It’s too boring for to continue on with the news conferences on the world’s tiniest stage, it was a hoax anyway, it’s time for a new story.
Maybe he can take up plate-twirling. Enjoy!
And, what about two weeks from now?
njbr: PLATE-TWIRLING
I sprayed my morning coffee out my nose when I saw that! 🙂
Widows and orphans cliff diving for yield…shades of David Stockman, complete with Congressional jabberwocky.
I’M not crazy; I’m NOT crazy; I’m not CRAZY. Maybe I’m crazy.
What is the breaking point with our debt? Does this finally end our ridiculous empire?
Ask Bernie Sanders. The US can’t run out of dollars. Fire up the printing press! Create more digitized digits!
When did we vote to become Venezuela? Both parties seem to be getting us there.
why ask bernie? is he head of the fed now?
Bernie’s economic advisor, Shelton, said “The carpenter can’t run out of inches. The stadium can’t run out of points. The airline can’t run out of FF miles. And the USA can’t run out of dollars.”
Hey, airlines could give everyone in the world 1,000 free frequent flier miles for every single mile purchased. What could go wrong, they can’t run out of them! I mean, Zimbabawe didn’t run out of dollars, they have $100 Trillion bills!
Look out below when everyone sees what’s IN the bill….