No Holiday Lights For Illinois Capitol Dome. Again.

Brendan Greeley, Colby Smith, Joe Rennison and Adam Samson write:

The US Federal Reserve has said it will slash interest rates to nearly zero and announced sweeping actions to support financial markets that have been dealt a severe blow by the coronavirus outbreak.

The central bank said on Sunday afternoon that it will cut the federal funds rate by 1 percentage point to a range of 0 per cent to 0.25 per cent. The move brings the rate to the historic low that was first set during the global financial crisis.

Its decision came as part of a broad package of measures that seeks to cushion the blow from the Covid-19 outbreak that has severely weighed on the global economy.

"The Federal Reserve is prepared to use its full range of tools to support the flow of credit to households and businesses and thereby promote its maximum employment and price stability goals," the central bank said.

The Fed said it would also purchase at least $500bn worth of Treasuries and $200bn of agency mortgage-backed securities in coming months.

The Fed also took action to make it easier for US banks to borrow from the so-called discount window. This is typically considered the 'lender of last resort' facility that banks can utilise if they are in urgent need of funding. 

Other measures included a co-ordinated action with the The Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, and the Swiss National Bank in a move aimed to boost dollar liquidity across the global financial system.

These swap lines effectively allow global central banks to get access to dollars in exchange for their own currency. The central banks’ announced that the cost of borrowing dollars would be lowered to 0.25 per cent above the fed funds rate. In addition to existing one week operations, the Fed announced a new 84-day liquidity line would begin from Monday.

The moves come after a brutal three-week spell in global markets marked by some of the most abrupt declines in stock prices since the financial crisis of 2008, stemming from an anticipation that the coronavirus pandemic will spark a global recession.

Investors were particularly alarmed by signs that the US government bond market last week started to show signs of strain, with highly unusual periods when haven bonds weakened despite drops in stock markets, making it difficult for fund managers to hedge themselves against the turbulence in other markets. The mortgage-backed securities market, which is the second-most liquid market in the world after Treasuries, also seized up.

The Federal Open Market Committe, the Fed's policy-setting body, signed Sunday's statement unanimously, with the exception of Loretta Mester, president of the Cleveland Fed, who supported all of the actions to preserve liquidity and household credit, but preferred to drop the policy rate at 0.5 per cent to 0.75 per cent.

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Watch now: Nearly 300 new laws take effect in Illinois on Jan.1. Heres 33 you should know.

Source:The Pantagraph

Watch now: Nearly 300 new laws take effect in Illinois on Jan.1. Heres 33 you should know.

Finlands Christmas resorts in full swing but fear omicron


Finlands Christmas resorts in full swing but fear omicron