Wall Street Is Calling the Federal Reserve for Bailout

In the midst of this week’s panic, Wall Street traders have been repeatedly calling for Federal Reserve intervention to support a market filled with ultra-fragile assets.

As a reminder, the Federal Reserve had already made a historic decision on March 3, 2020 by lowering interest rates by 50 basis points with a target of 1% to 1.25%.

This cut had been decided unanimously in order to support the U.S. economy in anticipation of the arrival of the coronavirus. In the last 20 years, such a cut had only been decided on two occasions: after 9/11 and after the financial crisis of 2008.

This interest rates cut was intended to encourage a quantitative easing policy on the part of the Federal Reserve with a significant injection of liquidity.

Nevertheless, Wall Street is so used to this type of monetary stimulus that it obviously did not find it sufficient. The financial markets collapsed all the same.

Donald Trump continued to put pressure on the Federal Reserve by calling for a further interest rate cut with a target of zero interest rates. The goal is to bring the interest rates in line with Europe, and its negative interest rates at -0.50%.

At the peak of the financial market downturn on March 12, 2020, the Federal Reserve then announced an injection of $1.5T of liquidity. The markets reacted for some time, before finally continuing their descent.

On Wall Street, many are calling for more liquidity injections from the Federal Reserve.

Wall Street has become so addicted to the stimulus of money creation that it wants more and more. This abuse makes the effects less and less tangible, while devaluing what everyone has.

When I say everyone, I mean first and foremost the least wealthy people, because they are the ones who are most affected by the arbitrary decisions of a few powerful people at the head of a failing system.

The Federal Reserve should therefore continue its work of support through its favorite recipe in the days and weeks to come: lower interest rates, then more and more money creation. The markets will force it to do so.

On March 13, 2020, in the middle of the day, Donald Trump declared a state of national emergency in the United States.

This announcement, coupled with the possible future decisions of the Federal Reserve that Wall Street is calling for, seems to have convinced some investors who regained some optimism at the end of the week.

Slight upturn in the Dow Jones

The situation remains precarious, and next week will also be extremely tense.