/perspectives/media/the-feds-shock-and-awe-coronavirus-response

The Fed’s “Shock and Awe” Coronavirus Response

Scott Minerd, Chairman of Investments and Global CIO, calls in to Bloomberg TV to discuss the Federal Reserve’s emergency Sunday night announcement of rate cuts and QE.

March 16, 2020

 

Key Takeaways:

  • Monetary policy is designed to deal with liquidity of markets, not economic disruptions.
  • All eyes now turn to Congress for fiscal policy solutions. An appropriate move would be a $2 trillion TARP-like program.
  • At this point a global recession seems inevitable, with 10-20% risk of a global depression if policymakers don’t move quickly.
  • ETFs trading at consistent discounts to NAV show investors don’t trust asset values.
  • A worse-case scenario could see the S&P 500 dropping to pre-financial crisis levels.


Read Global CIO Outlook: Meeting An Historic Challenge


FEATURED PERSPECTIVES

March 27, 2020

The Faustian Bargain

The consequences of policymakers returning to the same tools employed in the financial crisis.

March 22, 2020

The Great Leverage Unwind

Funding and trading markets are not functioning well due to excessive leverage needing to be unwound in the financial system.

March 20, 2020

Value Is a Poor Timing Tool

Markets often overshoot, and just because things are cheap doesn’t mean they can’t get cheaper.


VIDEO

Fourth Quarter 2019 Fixed-Income Outlook 

Fourth Quarter 2019 Fixed-Income Outlook

Brian Smedley, Head of the Macroeconomic and Investment Research Group, and Portfolio Manager Adam Bloch share insights from the fourth quarter 2019 Fixed-Income Outlook.

Core Fixed-Income Conundrum 

Solving the Core Conundrum

Anne Walsh, Chief Investment Officer for Fixed Income, shares insights on the fixed-income market and explains the Guggenheim approach to solving the Core Conundrum.







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