As the COVID crisis continues unabated, clients have sought guidance on actions the Administration, Fed, and bank regulators could take under current law to address financial-sector disruptions due both to market turbulence and customer distress.  Karen Petrou has already outlined one facility the Federal Reserve could quickly open under current law and the FDIC and Treasury also have emergency powers noted in prior advisories that are assessed in more detail in this report along with Treasury’s tools.  We view these options as the most likely near-term ones, but the President also has far-reaching authority to intervene in the wake of his decision to declare a national emergency that can be used in lieu of or in addition to statutory change to U.S. fiscal policy.  The most likely of these tools authorizes direct U.S. loans or loan guarantees to combat productivity losses due to a national emergency.

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