Mnuchin: Federal Reserve Will Buy Corporate Bonds, Treasuries, Mortgage-Backed Securities In "Vast Amounts" | Video | RealClearPolitics

Mnuchin: Federal Reserve Will Buy Corporate Bonds, Treasuries, Mortgage-Backed Securities In "Vast Amounts"

|

Treasury Secretary Steven Mnuchin discusses steps the White House is taking to satisfy economic discomfort amid coronavirus. Mnuchin announced a slew of programs the Federal Reserve will employ to keep the economy on track and shut down the idea that coronavirus relief is "corporate welfare."

MARIA BARTIROMO, FBN ANCHOR: And joining me right now is U.S. Treasury Secretary Steven Mnuchin, joining us on the telephone.
 
Mr. Secretary, thanks very much for joining us.
 
What do you say to these calls from Bill Ackman, from Steve Bannon to shut the country down for 30 days, let business understand that there is an end date so that they can look forward to the recovery?
 
STEVEN MNUCHIN, TREASURY SECRETARY (on the phone): Well, Maria, first of all, it's always great to be with you.
 
I only caught the end of -- of Bill's comments, so I didn't hear what he said.
 
Let me just say, I would separate the medical issues from the economic issues. I'm -- I'm going to leave the medical advice to the medical professionals.
 
But what we have been focused on, on economic issues. So let me just, again, start with some of the most important things in this bill. For any small business, 500 people or less, most of these businesses have been shut down at no fault of their own. They are going to be able to take an SBA loan that will give them two months of payroll and some overhead. And if they hire the workers back or they keep their workers hired, the government will forgive that loan.
 
So we want all small businesses to keep employees on so that they can reopen those businesses quickly when it's medically sufficient. And I know some people have been concerned about the SBA process. I assure you that the Treasury will be working with the SBA, that we're going to add an enormous number of new lenders. Basically this is going to work that any small business can go into a bank very quickly, get the loan underwritten and get the money fast.
 
BARTIROMO: So then why are your Democrats -- colleagues, the Democrats in the Senate, pushing back saying that there's not enough money for medical workers, there's not enough money for individuals. They're calling this corporate welfare, Secretary.
 
MNUCHIN: Well, Maria, that's just ridiculous. This isn't corporate welfare. This helps all American workers. And, again, the small business program has been negotiated on a bipartisan basis. There's enormous bipartisan support for this. I would also say there's lots of bipartisan support for putting money in the Exchange Stabilization Fund for us to be able to create broad-based programs with the Federal Reserve to support businesses so that they have liquidity.
 
I think you saw this morning --
 
BARTIROMO: Right.
 
MNUCHIN: We've made three new announcements that with the Fed we'll be supporting the asset-backed markets, the primary corporate bond markets, the secondary corporate bond markets. The Fed has also announced purchases of Treasuries, mortgage backed securities in vast amounts. Fannie Mae and Freddie Mac also made some announcements. So I can assure you, we are using all the tools we have and we've told Congress we need additional tools ASAP. So I hope that the Senate passes this bill today.
 
BARTIROMO: The Federal Reserve -- these Federal Reserve facilities, obviously they are resonating. Markets have completely reversed course with -- with these new actions this morning. And markets are -- are happy, obviously, about these moves.
 
But let me ask you about what Ted Cruz tweeted over the weekend in response to what he was working on in the Senate, the fiscal stimulus plan. He says this, “In negotiations for economic crisis relief, some are pushing for a special carve-out just for Boeing and GE. That would be wrong. Millions are losing jobs. We don't need bailouts or corporate welfare.” This is from a Republican, Ted Cruz. “Those companies should participate in the same liquidity program as everybody else.”
 
We know that Boeing was down, lost 44 percent of its value in just a week, Secretary. Are there plans to take an equity stake in Boeing?
 
MNUCHIN: Maria, I want to be clear, there are no bailouts. This is not about bailing anybody out. There is a special provision that we are in the process of negotiating for airlines. Airlines do provide significant resources and national security issues. We want the airlines to continue to be able to operate. Domestic air travel, I believe that's something that's very important to Americans. And when the economy opens up, we need to be able to have these airlines.
 
So there are very specific provisions to airlines, and those are still being negotiated as we speak.
 
BARTIROMO: And will you take equity stakes, the government, equity stakes in the airlines?
 
MNUCHIN: What I would say is, we will be doing things on market terms. And if we determine that market terms include equity, we have the ability to do that. So the president has made very clear, if the taxpayers are putting money at risk, they should be properly compensated.



Comment
Show comments Hide Comments

Latest Political Videos

Video Archives