Click here for Logical Analysis ReportOp-ed:
From our analysis, we found the following most relevant:Measures have included support for money-market funds and primary dealers, as well as Treasury bill purchases and repo (collateralized repurchase transactions) to support the overnight and short-term money markets on whose smooth functioning the financial system depends.
Fiscal policy efforts are aimed at helping consumers and businesses survive financially and to get them to the other side of the crisis. Fiscal policy initiatives in this category include 1) providing income to workers with paycheck replacement and expanded unemployment insurance programs and (2) making loans to companies to keep them in business.
What is critical to appreciate is that support programs aimed at limiting the damage from the phase transition of the cascading network collapse, while essential to putting a floor under the damage, these monetary and fiscal emergency programs do not assist the economy in dealing with long-term financial distress or in accelerating the pace of economic recoveryAfter the virus containment measures are relaxed and the economy starts to go back to work, we enter the second phase: financial distress and restructuring. Consumers, businesses, and governments assess the financial damage from the cascading network collapse phase, and they try to develop strategies to go forward in an altered economic environment of severely limited resourcesThis category includes, among other things, spending on infrastructure and direct grants to state and local governments.
Loans. Loans from the Fed or the Federal Government are mainly useful to keep businesses and consumers afloat, so they helped in the cascading network collapse phase to get one to the other side, but they are not as useful in the rebuilding phase