Coronavirus: State of the Economy Part Two

Jill on Money with Jill Schlesinger

Audacy

Self-improvement, Business, Investing, Education

4.6 • 1.8K Ratings

🗓️ 14 June 2020

⏱️ 12 minutes

🔗️ Recording | iTunes | RSS

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Summary

More than 1.5 million Americans filed for unemployment last week, bringing the total jobless claims to over 44 million in the last 12 weeks. Yes, weekly job losses continue despite a big gain in May. And yes, the rollercoaster on Wall Street is just as bumpy as it was a few months ago. To help try and demystify the current state of the economy, we're joined today by Mark Spindel, one of my oldest friends in the world and the Managing Member, Chief Executive Officer and Chief Investment Officer for Potomac River Capital. Mark, who along with Sarah Binder, recently published: The Myth of Independence: How Congress Governs the Federal Reserve. If you're looking for a deep dive on the Fed, this is the book for you. Have a money question? Email me here. Please leave us a rating or review in Apple Podcasts. "Jill on Money" theme music is by Joel Goodman, www.joelgoodman.com. To learn more about listener data and our privacy practices visit: https://www.audacyinc.com/privacy-policy Learn more about your ad choices. Visit https://podcastchoices.com/adchoices

Transcript

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0:00.0	Welcome to the Jill on Money Coronavirus Market Update. It is Sunday, June 14th
0:09.1	Flag Day to you and me here in the United States. We are featuring the second part of our interview with
0:15.8	Mark Spindell, the founder and chief investment officer of Potomac River Capital. He is also the
0:22.4	co-author of a book called The Myth of Independence,
0:26.2	How Congress Governs the Federal Reserve. And for this part of our interview
0:32.1	Mark, let us focus on the Federal Reserve, which met this week and luckily didn't do anything because that would have meant a lot of extra reporting on my part.
0:43.9	Interest rates are at zero.
0:46.0	So here's the question that I have for you.
0:49.0	How would you rate the Fed's performance during the pandemic?
0:54.2	So I would give them maybe a solid gentleman's B and I think they have rolled out a set of policies
1:02.0	quickly. They have responded in ways that Congress
1:06.9	designed, but I worry that we may be or we should be thinking about costs and consequences to a Fed that has
1:16.3	completely intermediated the market for credit. Explain that sentence the Fed that has intermediated credit.
1:25.0	Explain what that means to regular people.
1:28.0	So the Fed has, you know, some extraordinary lending powers and typically in normal times it
1:36.7	sort of operates by lending money or taking money away borrowing money back
1:42.4	from the financial sector, from banks.
1:45.6	That's by design, that was sort of back to the nearly century plus origins of the Federal Reserve. But in times of extreme panic, exigent circumstances,
1:58.0	the Fed can lend money much more directly to the public and private sector, to corporations, to
2:05.4	municipalities, state and local governments. It is supposed to lend money with
2:10.0	the expectation that it will get it back. So it is not looking to take losses.
2:15.6	The Fed is now looking to lend money to small, medium, large corporations, the
	...

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