Re:What's the point of a Covid-19 test that takes 19 days fo...
by ralph84 on Saturday July 25, 2020 @06:40PM
(#23952935)
State and local governments are allowed to borrow and they do quite a lot of it. The difference is they don’t have a guaranteed buyer for their debt like the federal government does with the federal reserve.
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Re:What's the point of a Covid-19 test that takes 19 days fo...
by kyboren on Sunday July 26, 2020 @03:35PM
(#23959553)
> The difference is they don’t have a guaranteed buyer for their debt like the federal government does with the federal reserve.
That is no longer true: https://www.federalreserve.gov/monetarypolicy/muni.htm
On April 8, 2020, the Board of Governors of the Federal Reserve System
(the Board), by the unanimous vote of its five members and with the approval of
the Secretary of the Treasury, authorized the establishment and operation of the
Municipal Liquidity Facility (MLF) under section 13(3) of the Federal Reserve
Act (12 U.S.C. § 343(3)). The MLF is intended to support lending to state, city,
and county governments.
Under the MLF, the Federal Reserve Bank of New York (Reserve Bank)
will commit to lend on a recourse basis to a special purpose vehicle (SPV). The
SPV will purchase eligible notes directly from eligible issuers at the time of
issuance.
[...]
The Department of the Treasury, using funds appropriated to the Exchange
Stabilization Fund under section 4027 of the Coronavirus Aid, Relief, and
Economic Security Act (CARES Act), will make a $35 billion equity investment
in the SPV in connection with the MLF.