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Articles 1 - 10 of 10
Full-Text Articles in Policy History, Theory, and Methods
The Application Of Policy Theory To Covid-19 Stimulus Checks, Michael Mchenry
The Application Of Policy Theory To Covid-19 Stimulus Checks, Michael Mchenry
The Gettysburg Journal for Public Policy
This paper analyzes COVID-19 stimulus checks in a variety of public policy frameworks. Punctuated equilibrium theory is useful in explaining the development and implementation of this policy action. Narrative policy framework provides context for how the stimulus checks were perceived by the public and how that perception influences future policy. The stimulus check policy is also analyzed from the perspective of both a rationalist and critical policy analyst. These three policy frameworks interact with one another to create a feedback loop that informs future crisis policy.
United States: Primary Dealer Credit Facility, Carey K. Mott
United States: Primary Dealer Credit Facility, Carey K. Mott
Journal of Financial Crises
In March 2020, the uncertain outlook for the United States in the face of the COVID-19 pandemic prompted extremely high demand for cash and near-cash assets. Amid intense selling pressure from investors, securities dealers were unable to fully absorb the high volume of trade orders into their inventory due to balance sheet capacity and funding constraints. As dealer capacity declined and demand for liquidity continued rising, volatility spread to the critical and normally highly liquid market for US Treasury securities, prompting the Federal Reserve to increase open market operations (March 12) and begin historically large purchases of US Treasuries (March …
United States: Money Market Mutual Fund Liquidity Facility, Carey K. Mott, Mallory Dreyer
United States: Money Market Mutual Fund Liquidity Facility, Carey K. Mott, Mallory Dreyer
Journal of Financial Crises
At the onset of the COVID-19 pandemic in March 2020, prime and tax-exempt money market funds (MMFs) faced increased demands for redemption. Meeting redemptions required MMFs to sell assets into increasingly illiquid markets. Using the emergency authority outlined in Section 13(3) of the Federal Reserve Act, the Board of Governors of the Federal Reserve established the Money Market Mutual Fund Liquidity Facility (MMLF), a facility similar in structure and purpose to a program that the Fed implemented in 2008 amidst the Global Financial Crisis (GFC). The MMLF extended nonrecourse loans to banks and their affiliates for the purchase from some …
Sweden: Corporate Bond Purchases, Carey K. Mott
Sweden: Corporate Bond Purchases, Carey K. Mott
Journal of Financial Crises
In the spring of 2020, corporate revenues in Sweden felt the direct effects of the coronavirus pandemic and the resulting public health measures. With future cash flows in question, many investors sold corporate debt for safe assets. Sweden's corporate bond market-particularly vulnerable to stress due to its heterogeneity, fragmentation, and lack of transparency-saw diminished liquidity. On March 19, 2020, the Sveriges Riksbank (Riksbank) announced it would purchase commercial paper and corporate bonds as part of a much larger bond-buying scheme, announced three days earlier, that included Swedish government, municipal, and covered bonds. It authorized the program under Chapter 6, Article …
Sweden: Commercial Paper Purchases, Carey K. Mott
Sweden: Commercial Paper Purchases, Carey K. Mott
Journal of Financial Crises
In March 2020, governments took measures to curb the spread of the COVID-19 pandemic that significantly impacted corporate revenues. The uncertainty surrounding the pandemic drove investors out of corporate securities and into safe assets, complicating the ability of Swedish nonfinancial corporations to finance their operations. As the volume of commercial paper issuance dropped, the Sveriges Riksbank (Riksbank) announced on March 19, 2020, it would purchase commercial paper and corporate bonds as part of a much larger bond-buying scheme that included Swedish government, municipal, and covered bonds. It authorized the program under Chapter 6, Article 5 of the Sveriges Riksbank Act. …
Israel: Corporate Bond Purchase Program, Natalie Leonard
Israel: Corporate Bond Purchase Program, Natalie Leonard
Journal of Financial Crises
By March 2020, the quickly spreading novel coronavirus began disrupting business activity and industry, generating uncertainty throughout the global economy. As financial panic spread, Israeli investors fled to liquidity, impacting equities, corporate bonds, and even Israeli treasury securities. As short-term horizon mutual funds experienced high withdrawals in the first few weeks of March, they were forced to sell corporate bonds. This increase in supply pushed corporate bond prices down, and yields spiked. Between March and May, domestic rating agencies downgraded 23 companies (12% of all rated companies), and by July 2020, yields remained in the double-digits for 23% of corporate …
Canada: Provincial Bond Purchase Program, Natalie Leonard
Canada: Provincial Bond Purchase Program, Natalie Leonard
Journal of Financial Crises
In the beginning of 2020, the outbreak of the novel coronavirus placed significant strain on financial markets and especially affected commodity-producing countries like Canada. As the broad economy contracted, oil-exports fell, and the government imposed public health restrictions to contain coronavirus, the Bank of Canada (BoC) announced emergency measures to ensure functioning of financial markets and to "reach companies and households and foster a robust recovery" (Poloz 2020, 1). One market that faced acute strain was the Canadian provincial bond market. The BoC announced the Provincial Bond Purchase Program (PBPP) through a notice published on April 15, 2020. The stated …
Canada: Corporate Bond Purchase Program, Sharon M. Nunn
Canada: Corporate Bond Purchase Program, Sharon M. Nunn
Journal of Financial Crises
The Bank of Canada (BoC) activated its Corporate Bond Purchase Program (CBPP) from May 26, 2020, to May 26, 2021, in response to liquidity strains in corporate bond markets that stemmed from economic uncertainty and the COVID-19 pandemic. Policymakers enacted the CBPP as part of a broader suite of policies meant to stabilize the Canadian economy. Through the CBPP, the BoC purchased Canadian corporate bonds through a tender process on the secondary market. The CBPP could hold up to CAD 10 billion (USD 7.7 billion) par value of eligible bonds issued by specific non-deposit-taking firms incorporated in Canada. The bonds …
Covid-19 Lockdowns Are Central Planning, Stephen Langeland
Covid-19 Lockdowns Are Central Planning, Stephen Langeland
Liberty University Journal of Statesmanship & Public Policy
The panic surrounding the COVID-19 pandemic led politicians to implement lockdowns and issue “stay-at-home” orders that follow in a long line of government attempts over the past century at economic central planning. With only a few notable exceptions among the several states, elected officials and bureaucrats seized on emergency powers afforded them by the onset of the novel coronavirus. In mid-March 2020 the publishing of the now infamous epidemiological models gave governments the sensational information they needed to get the wheels of government planners turning. The present government-induced crisis once again demonstrates that the intellectuals of the ruling class responsible …
Lessons Learned: Donald Kohn, Maryann Haggerty
Lessons Learned: Donald Kohn, Maryann Haggerty
Journal of Financial Crises
Kohn, an economist, is a 40-year veteran of the Federal Reserve System. He served as a member of the Board of Governors, and was vice chair, from 2002-2010, which included the years of the global financial crisis (GFC).