The Fed says it is going to start buying individual corporate bonds

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The feds are picking and choosing the winners and losers. That’s all. I’ve gotten so much shit for this few days ago but here I go again. The feds have the power of unlimited debt and policy making. They have the power to manipulate debt however they want. They will buffer massive defaults and selloffs. There are no fundamentals. If another potential crises or sell-off comes, they will just poof another policy to buffer it. Our economy is unbelievably zombified. The wealth inequality will be significantly increased.


Honest question, why is the FED doing this? Are legitimate corporations that have money in the bank having a hard time selling bonds?


I look forward to the announcement that the Fed will start buying used cars.


Paying corporations with deficit spending isn’t socialism but healthcare for everyone is?


Either the Fed is aware that some critical companies are on the fritz and is preparing the way for them to get bailed out, or this is just shock and awe gone overboard. In the former case, say hypothetically the Feds could sense that an airline (or GE, or a bank, etc.) is on the precipice. They can focus their liquidity assistance on the company without buying a bunch of other extraneous, unwanted bonds. Buying $3 billion of AAL bonds directly is much easier than $30 billion worth of ETFs that has 10% exposure to AAL. There may not even be $30 billion worth of ETFs containing AAL available on the open market. I do feel this announcement is definitely crossing a line that makes me uneasy and wonder if it is a harbinger of something bigger coming down the pipe…