Drastic Fed interventions are unprecedented, but are they enough?
By Martha C. White
The unprecedented steps taken by the Federal Reserve and the coordinated action of central banks around the world in response to the coronavirus pandemic will hopefully be enough to shore up the financial system, but market observers are still holding their breath. …Karen Shaw Petrou, managing partner of consulting firm Federal Financial Analytics, said that “whatever” should be more direct intervention. “The Fed’s major focus is on funding the markets in the hopes that the market will then support households and businesses. But my belief is the Fed can’t do the two-step process. It has to be direct. This is too much of a crisis to be deferential to market mechanisms,” she said.