Did the Fed inadvertently become owner of EQUITIES? Consider-
The Fed's been buying billions of HYG ETF. HYG owns Hertz bonds (below). Hertz filed Ch 11 bankruptcy. Process typically wipes out equity holders, entitles bondholders to new equity after workout.
Just the beginning? t.co/Gf8f85d3AR
— Rich Kleinbauer (@RMKOutFront) May 25, 2020
Moral Hazard Risks of Fed as debt-to-equity holder are many, but for bond/equity traders…
So Top Ten List – Go! t.co/KylfZcI5Nk
— Samantha LaDuc (@SamanthaLaDuc) May 25, 2020
He can’t print demand too. He can’t force people to consume. FED is weak.
— Hoz (@Hoz94s) May 25, 2020