The 2020 outbreak of the novel coronavirus (COVID-19) created a financial environment driven by angst and trepidation. COVID-19 panic swept the globe, placing the world’s capital structure under extreme pressure. The result was consistently high volatilities in the commodity, equity, currency, and debt markets.
In the modern era, the global credit crunch of 2008 is the standard for financial crises. A product of toxic asset securitization and subprime mortgage lending, 2008 brought to light severe shortcomings in the world’s monetary system. Twelve years later, the coronavirus (COVID-19) pandemic has once again forced the hand of the U.S. Federal Reserve… Read more.
The official mandate of the U.S. Federal Reserve (the Fed) is to “promote maximum employment, stable prices, and moderate long-term interest rates in the U.S. economy.” Achieving this task can require a variety of actions, including adjustments to the federal funds rate and bond purchasing programs. Not all of these activities skew market behavior, but… Read more.