Happy New Year
Based on the last we’ve heard of Steven Mnuchin, the Treasury will be ending 8 of the 13 key “emergency” programs currently being implemented (including the critical bond market Corporate Credit facilities, PMCCF and SMCCF) by December 31st of this year.
With financial markets soaring this year in part due to the close cooperation between the Fed and Treasury, it’s important to know how this decision has the potential of affecting people and the country. First, the continuation of major quantitative easing into 2021 is no guarantee. Above this, among the programs that will be “expiring” by the end of year, one that could have the most serious consequences of them all is the expiration of many key provisions in the CARES Act.
If there is no action by Congress by December 31st, around 12 million Americans will likely lose their Emergency unemployment benefits. This will be coming at a time where the expiration of eviction moratorium, mortgage forbearance programs, and suspension of student loan payments are also being thrown out the window.
According to a survey run by the Urban Institute, one third of landlords were not paid in full in the month of September. This data indicates that roughly 30 million renter households will be at risk of eviction once the moratorium expires. It’s hard to say exactly how these decisions will affect the majority of citizens but trying to understand the different avenues things could take without further intervention is an important question for anyone and everyone.
I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.
