Trump Seeks $850 Billion Stimulus Package, Stocks Rally

Mish

The money spigots are on. As expected.

Everyone is seeking money and Trump is willing to dish it out to the tune of an $850 Billion Stimulus Package.

U.S. Treasury Secretary Steven Mnuchin is pitching Senate Republicans on a roughly $850 billion economic stimulus package, according to two people familiar with the matter, as the Trump administration works to craft more legislation to cushion the economic blow of the coronavirus pandemic.

Democrats have proposed their own $750 billion package for the third phase of the response, and other lawmakers have started floating a variety of measures, including giving $1,000 in cash to every American.

Bailouts

The Trump administration’s stimulus plan will include roughly $50 billion for the airline industry, according to the people, as well as billions of dollars in general stimulus that could include a payroll tax cut.

The details remain in flux and even the top-line $850 billion figure could change, but Mr. Mnuchin is expected to discuss a number of options with Republicans, including a refundable tax credit to help people struggling with the economic effects of the outbreak and additional assistance for small businesses.

Boeing Wants a Bailout

Airline Bailout

Note that airlines spent U.S. Airlines Spent 96% of Free Cash Flow on Buybacks.

Casinos Want a Bailout

I had a few choice words for that one.

Stock market Likes Bailouts

The stock market likes bailouts.

But let's see what it thinks in a few days with an eye on Bear Market Support Levels.

Mike "Mish" Shedlock

Comments (52)
No. 1-23
Greenmountain
Greenmountain

Boeing???? What happened to all the capitalist in the Republican Party. Boeing brought this on all by themselves. Cut corners and got caught. And these are the same people who will say we should not give bailouts to individuals because it will discourage them from working. Business bailouts encourage bad behavior. If one business gets a bailout, then we better be willing to help every individual who is now unemployed - bartenders, wait staff, cooks, retail store workers. All the hourly and contract workers. But alas, I forgot we are only capitalist when we try to put in place regulations that might control some bad behaviors.

ohno
ohno

I just came home with ten handles of whiskey. I'm going to stimulate myself. Jim Beam me up Scotty.

dwade
dwade

In a week or two people are going to want hospital beds and not a check.

killben
killben

If you close down everything depression is inevitable. Rest is noise!
Bear market support levels will be going going gone in such a case.

Bam_Man
Bam_Man

A "Payroll Tax Cut" for people who will soon be unemployed and completely broke.

Hoooray!

This is where "faith" in government finally reaches a level of ZERO (or less).

killben
killben

Also, how long can you keep sending cheques to individuals and companies (forget they do not deserve it)? What a loony idea!

killben
killben

Can anyone discern what other nefarious idea is behind this gutting of the economy and how is the elite going to benefit from this (I am naturally suspicious of the intentions behind any action by the Fed and the government)

Art Izagud
Art Izagud

UBI will build the 21st century economy beyond cranks and cronies. Let economies restructure and be more human based rather than set up to pamper boomer consumption. All those who advocate mere survival of the fittest economy should also be ok with the young and destitute refusing to quarentine.

Tony Bennett
Tony Bennett

"including giving $1,000 in cash to every American."

That might (help) keep bills at bay for a month for average citizen. Then what??

wootendw
wootendw

"...including giving $1,000 in cash to every American."

George McGovern proposed that during his 1972 campaign against Nixon.

Freebees2me
Freebees2me

Reminiscent of US Airways that re-purchased a ton of stock at $40/shr and within two years was in Chapter 11.

Same industry, Same mistakes, Same result - Chapter 11.....

numike
numike

when do I get my 1,000 tax free check??

Maximus_Minimus
Maximus_Minimus

It takes some time because of procrastination, but eventually the trust in the reserve currency and its treasuries will be gone, because of endless shenanigans like these.

Zardoz
Zardoz

Works for me. There have to be bailouts, or this sucker's goin down. Bail out the filthy poors. The rich will take it from them soon enough. Bonus: No food riots!

Ted R
Ted R

Well.....I guess we can forget about 'The Donald' balancing the federal budget.

Bam_Man
Bam_Man

Oil price crashing by ANOTHER 6% today.

But hey, the DOW is up.

Jojo
Jojo

So market is up because of more free money from the government? Because with so many businesses closed there isn't going to be a lot of economic activity in the next 4-6 weeks.

One Simple Idea That Explains Why the Economy Is in Great Danger
What happens when a major section of machinery that is supposed to run perpetually suddenly grinds to a halt? We are about to find out.
Neil Irwin
March 17, 2020

P.S. Any idea when the like button is going to get fixed?

Schaap60
Schaap60

I'm fine with helping people living paycheck to paycheck. As for these corporations, if they need to they can file for BK protection and the investors and executives who profited from buybacks can learn how capitalism should work. For all the complaints about Sanders and socialism, America's problem is that socialism currently only applies to the rich. Of course Sanders isn't the answer, but socialism for the rich (investors and executives) also needs to stop. The planes, casinos, etc., won't disappear in BK court, those assets will end up in the hands of someone who can manage them better. Actual capitalism would be nice for a change.

Realist
Realist

Trump has been paying down the debt for 3 years with all that tariff money that China paid the US. Just ask him. He will explain it.

He is going to get Canada and Mexico to pay for these $1000 checks, by promising to build a wall on both borders to prevent infected Americans from sneaking into those two countries, looking for health care.

Dubronik
Dubronik

That sounds like hush money to help the Mr. Dump reelection.

phatmaster
phatmaster

Really feeling it in the commodities markets. Never thought we would see $20 oil

Herkie
Herkie

Rally did not last long, Dow is set to open 900 points lower if it opened right now. And more bad news, the governor of Nevada just ordered ALL casino and "non essential" businesses to close for a month. Having moved here from Las Vegas last year I can already see what this will do to Las Vegas and it will not be pretty.


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