Monday, October 6, 2025

Latest

Federal Reserve to Begin Purchasing Direct Corporate Bonds Instead of ETFs

As a means of propping up the coronavirus-stricken US economy, the Federal Reserve introduced two credit facilities back in March that would be focused on the corporate debt market. The first facility would directly purchase bonds from issuers, whilst the other would be concentrated on buying the bonds on the open market – many of which have thus far been ETFs.

Speaking before the House Financial Services Committee on Capitol Hill, Fed chairman Jerome Powell stated that the central bank will now transition towards purchasing individual company debt instead of ETFs. According to Powell, the gradual transition towards individual bond buying would support market functioning as well as liquidity. Once companies are back on track and financial stressors are mitigated, the Fed will ease its monetary support – however, such a recovery could still be far away.

In addition, the Fed has also been met with some criticism regarding its corporate bond buying program. Some of the companies benefiting from the facility have been rated junk or speculative grade, and are thus exposing the Fed, and ultimately taxpayers, to an increased level of risk.

Information for this briefing was found via CNBC. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

Video Articles

Fortune Bay: The Potential Billion Dollar Project

Japan Gold Enters New Chapter as Barrick Alliance Concludes – John Proust

Barrick Mining’s “Company Defining [Gold] Discovery”

Recommended

Nord Precious Metals Produces High Grade Silver Concentrate From Tailings

ESGold Secures $9 Million In Non-Dilutive Funding From Ocean Partners

Related News

Trump Signals Fresh Fed Tensions Ahead of Return to Office

President-elect Donald Trump launched a fresh attack on US monetary policy Tuesday, arguing that borrowing...

Wednesday, January 8, 2025, 12:04:00 PM

Federal Reserve to Begin Tapering by $15 Billion in November, Stays Put on Interest Rates

The Federal Reserve has finally decided to take a more hawkish stance on its bottomless...

Thursday, November 4, 2021, 10:19:00 AM

Rapid Pace of Rent Increases in the U.S. Seems to Argue for Aggressive Action by the Fed

The stock market is facing two main obstacles: 1) the global economic impact of the...

Tuesday, February 22, 2022, 03:41:00 PM

US Fed Is Running Into Significant Hurdles With Main Street Lending Program

The Federal Reserve had previously announced it will be providing loans for middle-sized businesses via...

Wednesday, May 20, 2020, 12:47:57 PM

Mnuchin: Fed to Make $4 Trillion Dollars of Loans Available to Small Businesses, Plus $3k Cheque to Families

Sweet Jesus! This morning US Treasury Secretary Steven Mnuchin was on Fox Business and said...

Sunday, March 22, 2020, 11:41:32 AM