Money

Trump signs $2 trillion economic rescue plan to rush aid to businesses, workers hurt by pandemic

President Trump signed a $2.2 trillion economic rescue package into law Friday to provide direct payments to most Americans and aid to workers and businesses idled by the coronavirus outbreak. “I want to thank Democrats and Republicans for coming together and putting America first,” the president said at the White House. Among the five congressional Republicans with the president in the Oval Office were Senate Majority Leader Mitch McConnell and House Minority Leader Kevin McCarthy. There were no Democratic lawmakers in attendance at the signing ceremony “It’s a proud moment for all of us,” Mr. McConnell said. Vice President Mike Pence said the new law means that “today, every American family, every American business can know that help is on the way.” The president’s signature capped a frantic week of deal-making between the White House and congressional Democrats as major portions of the economy ground to a halt to stop the spread of the virus. The measure provides $500 billion in loans for distressed companies, beefed-up unemployment insurance for 39 weeks in most states, $350 billion in loans and grants for small businesses and direct payments of $1,200 to most Americans.

Senate Unanimously Passes Historic Coronavirus Relief Package

The Senate passed a substantial emergency relief bill on Wednesday night that would provide aid to small businesses, hospitals, and Americans suffering from the impact of the coronavirus outbreak. The Senate passed H.R. 748, the CARES Act, with 96 votes in favor of the bill and no senators opposed to the legislation. The legislation featured unanimous support from Republicans and Democrats. The legislation required 60 votes to pass through the Senate. The Senate coronavirus package costs roughly $2 trillion and is approximately 880-pages long. The Senate shot down an amendment to the bill sponsored by Sen. Ben Sasse (R-NE), which would reverse the bill’s generous unemployment benefits. Sens. Sasse, Lindsey Graham (R-SC), Tim Scott (R-SC), and Rick Scott (R-FL) contended that the legislation would incentivize Americans not to work. The amendment required 60 votes to pass through the chamber. Sasse’s amendment was shot down with 48 votes in favor and 48 against the measure. Treasury Secretary Steven Mnuchin rebuffed the Republican senators’ concerns over the bill, contending this will help those who involuntarily lost their jobs. “I don’t think it will create incentives. Most Americans, what they want, they want to keep their jobs,” Mnuchin said. “We need to get this money into the American economy and American workers, that’s the importance of this,” he added. The Senate Cares Act would provide most Americans $1,200 per individual, $500 for most children, and establish a several hundred billion dollar lending aid program for businesses, cities and states, as well as aid for small businesses. The bill also omits many Democrat requests such as mandatory early voting, ballot harvesting, requirements that federal agencies analyze their use of “minority banks,” and provisions to curb airline emissions. Senate Majority Leader Mitch McConnell (R-KY) said on the Senate floor before the vote that the chamber “will stay nimble” to combat the coronavirus. He added that there would be no more votes in the Senate until April 20.

Think about this..  The vote was 96-0 in the Senate!  What a credit to Sen. Majority Leader Mitch McConnell’s (R-KY) leadership.  Great job Mitch!!  Now, the bill is back to the House where Nancy Pelosi, who can’t spell the word leadership and doesn’t give a damn about American workers, will dilly dally and drag this thing out, while Americans are suffering.  Hopefully, she’ll can get off her pompous ass tonight, or tomorrow latest, and get this thing passed in her chamber, and get it to President Trump’s desk for his signature.

Ed Secretary Betsy DeVos Halts Collections Actions Against Student Loan Defaulters

U.S. Education Secretary Betsy DeVos has directed the Federal Student Aid (FSA) office to halt collection actions and wage garnishments against students who have defaulted on their education loans. According to a press release, DeVos’s department will refund more than $1.8 billion to more than 830,000 students in default in order to provide assistance during the coronavirus crisis. DeVos said in a statement: ” These are difficult times for many Americans, and we don’t want to do anything that will make it harder for them to make ends meet or create additional stress. Americans counting on their tax refund or Social Security check to make ends meet during this national emergency should receive those funds, and our actions today will make sure they do.” The period of flexibility is retroactive from March 13, the date President Donald Trump declared a national emergency, and will continue for at least 60 days from that date. The education department has halted all requests to the U.S. Treasury to deny funds from defaulted borrowers’ federal income tax refunds, Social Security payments, and other “Treasury offsets.” DeVos has also instructed private collection agencies to stop their activities to obtain payments from student borrowers. Trump announced students with federal loans would automatically have their interest rates dialed back to 0 percent for a period of at least 60 days. Students may also suspend their loan payments for at least two months to allow greater flexibility during the emergency situation. Education department site studentaid.gov states: ” To provide relief to student loan borrowers during the COVID-19 national emergency, federal student loan borrowers can be placed in an administrative forbearance, which allows you to temporarily stop making your monthly loan payment.” Students and families with further questions about their federal student aid during school closures can visit the same site for assistance. Just click here:

 

Trump emerges as oil’s white knight after worst week since 2008

The battered U.S. oil market may have just received a lifeline from President Trump after crude prices posted the worst week since 2008 hugging the $31 per barrel level, down 48 percent so far this year. Trump, as part of his national emergency declaration to combat the fallout from the coronavirus, greenlighted the Department of Energy to step into the market as a buyer. “Based on the price of oil I have also instructed the Secretary of Energy to purchase, at a very good price, for large quantities of crude oil for storage in the U.S. Strategic Reserve, we are going to fill it right up to the top, saving the American taxpayer billions and billions of dollars and helping our oil industry,” Trump stated on Friday. The move, according to Phil Flynn of The PRICE Futures Group, should boost oil prices from historic lows. “This could send prices back into the $40s if the buyers are there,” said Flynn, when reached for his reaction. “They [the U.S.] can buy oil at the lowest price in years,” he added. The Strategic Petroleum Reserve is the world’s largest supply of emergency crude oil, as described by the DOE, and was established as a backup facility to protect the U.S. in the event of market disruptions or potential shortages. The oil market hit a sharp downward spiral on Monday, with prices falling over 30 percent, as Saudi Arabia and Russia engaged in a price war, flooding the market with product. The action, which choked U.S. energy producers, prompted oil tycoon Harold Hamm, CEO of Continental Resources, to pursue justice after he deemed the international move “illegal.” “They’re taking advantage of this coronavirus pandemic that’s sweeping the world to focus in on this industry and devastate it,” Hamm, founder, and executive chairman at Oklahoma City-based Continental Resources Inc., said during an interview on FOX Business’ “Cavuto Coast to Coast” on Wednesday. “That’s not gonna happen. We’re gonna take action on them. We’re gonna investigate that.” He said the Domestic Energy Producers Alliance has taken action to pass a resolution and start an anti-dumping investigation into Saudi Arabia, Russia and possibly other countries. Treasury Secretary Steven Mnuchin also put Russia on notice, speaking to Ambassador of the Russian Federation to the United States Anatoly Antonov in which he “emphasized the importance of orderly energy markets,” according to a statement following the heavy selling.

Stocks post biggest rally since 2008, clawing back some of their coronavirus collapse

Stocks soared Friday as Wall Street rebounded from the sharp losses suffered in the previous session — the worst since the “Black Monday” market crash in 1987. The Dow Jones Industrial Average closed 1,985 points higher, or 9.4%, at 23,185.62. Friday marked the Dow’s biggest-ever point gain. The S&P 500 climbed 9.2% to 2,711.02 while the Nasdaq Composite surged 9.3% to 7,874.23. The averages posted their biggest one-day gain since October 2008. “Volatility, I always remind people, means big moves in both directions,” said Randy Frederick, vice president of trading and derivatives at Charles Schwab. “After as big of a rout as we’ve seen in the last 30 years, it’s not at all surprising to see at least a little bit of a bounce.” Equities rallied to their session highs into the close after President Donald Trump also said 50,000 new coronavirus tests will be available next week. Trump also said he asked the Energy Department to purchase oil for the U.S. strategic petroleum reserve, boosting crude prices. “This is certainly an important step forward. The first thing we learned from South Korea is you need to understand the scope of the problem, and you need to identify the disease and who has it and who does not,” said Ed Keon of QMA. “Today will be an important step forward…You saw a big drop when the response seemed inadequate and then when you had a more aggressive response, the market responded positively.” Stocks began the day higher on the hopes of bigger fiscal stimulus from the U.S. government and others around the world. Treasury Secretary Steven Mnuchin told CNBC’s “Squawk on the Street” the White House and Congress were nearing a deal. “The president is absolutely committed that this will be an entire government effort, that we will be working with the House and Senate,” Mnuchin said. House Speaker Nancy Pelosi said U.S. lawmakers and the White House were close to a deal on economic relief amid the coronavirus outbreak. “We’ve resolved most of our differences,” Pelosi told reporters Thursday evening, noting it’s about “testing, testing, testing.” Also helping equities on Friday, the Federal Reserve said it will start buying Treasurys across all durations, starting with 30-year bonds. “These purchases are intended to address highly unusual disruptions in the market for Treasury securities associated with the coronavirus outbreak,” the New York Fed said in a statement. Apple and Facebook jumped more than 10% each to lead the so-called FAANG stocks higher. Google-parent Alphabet gained 9.3% while Amazon and Netflix both rose more than 6%. For the week, the major averages posted steep losses despite Friday’s sharp gains. The Dow lost 10% this week while the S&P 500 and Nasdaq slid more than 8% each. Friday’s action followed the official end of the longest bull-market run in history. The S&P 500 plummeted 9.5% Thursday in its worst day in more than three decades, joining the Dow in a bear market, or more than 20% from its recent peak. The Dow also suffered its worst point drop ever and the biggest percentage decline since 1987. “It almost seems as if the market has a gravitational force to that Dec. 24, 2018 low,” said Quincy Krosby, chief market strategist at Prudential Financial. “It feels as though the market wants to go back there.” “That said. there has been indiscriminate selling, which is good thing,” said Krosby. “That’s the kind of panic you wait for.” Investors were bombarded with a slew of negative headlines about the fast-spreading coronavirus this week. The NCAA has canceled its March Madness basketball tournaments, a day after the National Basketball Association suspended the remainder of its season indefinitely. New York Mayor Bill de Blasio declared a state of emergency, while new restrictions for large events and businesses were imposed. “We expect volatility to remain for a while,” said Gene Goldman, head of research at Cetera Investment Management. “There’s so much unknown about the virus and the economic impact.”

Indeed..  But, again..we’ll weather this storm and get through it.

US stock futures soar to limit-up level

U.S. equity futures surged Friday morning, reaching the highest increases allowed outside regular trading hours, after both the Federal Reserve and the Bank of Japan pumped money into the financial system. The major futures indexes — for the Dow Jones Industrial Average, S&P 500 and Nasdaq — are indicating a gain of 5 percent once regular trading starts. Gains in such equity futures contracts have been capped at 5 percent during overnight trading under rules imposed after the “flash crash” of 2010. The rallies suggest a sharp turnaround from Thursday, which saw Wall Street’s biggest drop since the Black Monday crash of 1987. Markets worldwide have retreated as fears of economic fallout from the coronavirus crisis deepen and the meltdown in the U.S., the world’s biggest economy, batters confidence around the globe. The sell-off on Wall Street helped to wipe out much of the big gains since President Trump took office. The S&P 500 plummeted 9.5 percent, for a total drop of 26.7 percent from its all-time high, set just last month. That puts it way over the 20 percent threshold for a bear market, officially ending Wall Street’s unprecedented bull-market run of nearly 11 years. The Dow Jones Industrial Average sank 2,352 points, or 10 percent, its heaviest loss since its nearly 23 percent drop on Oct. 19, 1987. European markets are also rebounding after one of their worst days ever. London’s FTSE jumped 8.1 percent, Germany’s DAX gained 7.7 percent and France’s CAC added 8.3 percent. The Bank of Japan on Friday said it would buy 200 billion yen ($1.90 billion) of Japanese government bonds in an unscheduled move, according to Reuters. The BOJ also announced it would inject an additional 1.5 trillion yen in two-week lending. In Asia, Tokyo’s Nikkei was down 6 percent, Hong Kong’s Hang Seng lost 1.1 percent and China’s Shanghai Composite declined 1.2 percent. The rout has come amid cascading cancellations and shutdowns across the globe — including Trump’s suspension of most travel to the U.S. from Europe — and rising worries that the White House and other authorities around the world can’t counter the economic damage from the outbreak any time soon. Stocks fell so fast on Wall Street at Thursday’s opening bell that they triggered an automatic, 15-minute trading halt for the second time this week. The so-called circuit breakers were first adopted after the 1987 crash, and until this week, hadn’t been tripped since 1997. The Dow briefly turned upward and halved its losses at one point in the afternoon after the Federal Reserve announced it would step in to ease “highly unusual disruptions” in the Treasury market and pump in at least $1.5 trillion to facilitate trading. The burst of momentum quickly faded, however. The coronavirus has infected around 132,000 people worldwide and killed almost 4,900. The death toll in the U.S. climbed to 40, with over 1,600 infections. For most people, the virus causes only mild or moderate symptoms, such as fever and cough. For some, especially older adults and people with existing health problems, it can cause more severe illnesses, including pneumonia. The vast majority of people recover from the virus in a matter of weeks. The combined health crisis and retreat on Wall Street have heightened fears of a recession. Just last month, the Dow was boasting a nearly 50 percent increase since Trump took the oath of office on Jan. 20, 2017. By Thursday’s close, the Dow was clinging to a 6.9 percent gain, though it was still up nearly 16 percent since just before Trump’s election in November 2016. The Dow officially went into a bear market on Wednesday, when it finished the day down more than 20 percent from its all-time high. For the S&P 500, this is the fastest drop since World War II from a record high to a bear market. The fallout mounted Thursday, as the NCAA canceled its men’s and women’s basketball tournaments, major league baseball postponed opening day, and Disneyland announced it is shutting down for the rest of the month. Even the Chinese side of Mount Everest closed. Closer to Wall Street, New York’s Metropolitan Museum of Art, Carnegie Hall and the Metropolitan Opera shut their doors, and Broadway theaters planned to go dark. In other trading, the oil market, which suffered huge shocks last week, is still on the decline. U.S. benchmark crude gained 4.3 percent, or $1.33, to $32.76 per barrel in electronic trading on the New York Mercantile Exchange. Brent, the standard for international crude pricing, added $1.25, or 3.9 percent, to $34.48 per barrel.

Well, on the bright side…gas is pretty cheap right now.  We’ll get through this folks.

Biden win gives Dow second best point gain ever

U.S. equity markets surged Wednesday after former Vice President Joe Biden’s strong showing on Super Tuesday lifted health care stocks and helped narrow the field of 2020 contenders as billionaire Mike Bloomberg tossed his hat out of the ring. The Dow Jones Industrial Average rallied over 1,173 points, the second-best point gain ever or 4 percent. The S&P rose 4 percent and the Nasdaq just under that level. Wednesday’s rebound came one day after the Federal Reserve’s emergency rate cut to insulate the U.S. economy from the new coronavirus. With votes still being counted, Biden had secured about 497delegates on Super Tuesday, according to the Fox News Tracker, capping a dramatic comeback after his campaign was left for dead following the Nevada caucus on Feb. 22. Meanwhile, Sen. Bernie Sanders, I-Vt., the self-declared democratic socialist and perceived frontrunner ahead of Tuesday night, had secured 461 delegates as of 4 PM ET Wednesday. Health care stocks, led by the insurers, soared in response to Biden’s big night. The names had been badly beaten down, underperforming the S&P 500, as Sanders, who is an advocate of Medicare-for-all, climbed in the polls. UnitedHealth Group, which closed nearly 11 percent higher. Airlines, cruise operators and online travel platforms, which have been under pressure amid the COVID-19 outbreak, won some relief while drugmakers working on treatments for COVID-19 were also higher. On the earnings front, Campbell Soup reported earnings and sales that topped Wall Street estimates and raised its 2020 profit outlook. Jack Daniels maker Brown-Forman lowered its guidance for sales growth due to an uncertain economic and geopolitical backdrop. Abercrombie & Fitch’s quarterly same-store sales exceeded forecasts amid strong holiday demand at its flagship stores in the U.S. U.S. Treasuries gained, pushing the yield on the 10-year note to just above 1 percent. The benchmark yield touched a record low 0.90 percent on Tuesday. West Texas Intermediate closed around the $47 per barrel level. OPEC and its allies will meet Thursday and Friday to discuss a production cut in the face of weaker demand due to the COVID-19 outbreak. Gold was little changed at $1,639 an ounce. In Europe, Britain’s FTSE spiked 1.5 percent while Germany’s DAX and France’s CAC added 1.3 percent and 1.2 percent, respectively. Overnight, Asian markets finished mixed with China’s Shanghai Composite adding 0.6 percent and Japan’s Nikkei edging up 0.1 percent. Hong Kong’s Hang Seng slid 0.2 percent.

To be clear…  Today’s rally wasn’t because Joe Biden had a surprisingly good night on Super Tuesday.  It was because crazy Bernie had a surprisingly bad night.  The market, and the healthcare industry, is terrified of Bernie and his socialist platform and what he’d do to our economy if, God forbid, he were elected President.  Today the market breathed a sigh of relief.