The presidential transition may have begun, but that doesn't mean the Trump administration is going to make it easy.
Outgoing Treasury Secretary Steven Mnuchin is moving to put nearly half a trillion dollars of Covid relief funds out of easy reach of President-Elect Joe Biden’s administration, according to a published report.
Mnuchin plans to put $455 billion, most of it carved back from the Federal Reserve, into treasury’s general fund, where it will require new congressional authorization before being used, Bloomberg reported.
Most of the money, $429 billion, was taken back from the Federal Reserve earlier this month. Those funds were used to back some of the Fed’s emergency lending facilities authorized last spring as markets spiraled and unemployment soared in the first wave of shutdowns prompted by the coronavirus pandemic. The Fed issued an unusual public statement opposing Mnuchin’s action, but agreed to return the money.
Mnuchin has argued that the money was no longer needed by the Fed because there is no longer much likelihood of financial markets freezing up.
Biden’s nominee for treasury secretary, former Fed Chair Janet Yellen, will still have some discretionary access to nearly $80 billion in the department’s exchange stabilization fund, Bloomberg reported.
Financial markets have largely rebounded from the severe strains of last spring’s selloffs. On Tuesday, the Dow Industrials closed above 30,000 for the first time, on apparent relief that the Trump administration has finally agreed to allow Biden access to Federal funds and resources to ease his presidential transition.
The S&P 500 also closed at a record, even as the latest surge in coronavirus cases continued to intensify ahead of the Thanksgiving holiday.