Federal Reserve Board Chairman Jerome Powell testifies during a Senate Banking Committee hearing, Thursday Sept. 24, 2020 on Capitol Hill in Washington about the CARES Act and the economic effects of the coronavirus pandemic. (Drew Angerer/Pool via AP)
By Martin Crutsinger
The Federal Reserve kept its benchmark interest rate at a record low near zero Thursday and signaled its readiness to do more if needed to support an economy under threat from a worsening coronavirus pandemic.
The Fed announced no new actions after its latest policy meeting but left the door open to provide further assistance in the coming months. The central bank again pledged to use its "full range of tools to support the U.S. economy in this challenging time.” The economy in recent weeks has weakened after mounting a tentative recovery from the deep pandemic recession in early spring.
Several Fed officials have expressed concern that Congress has failed so far to provide further aid for struggling individuals and businesses. But the Fed's policy statement, issued after a two-day meeting, made no mention of lawmakers' failure to act.
A multi-trillion-dollar stimulus, enacted in the spring, had helped sustain jobless Americans and ailing businesses but has since expired. The failure of lawmakers to agree on any new rescue package has clouded the future for the unemployed, for small businesses, and for the economy as a whole. There is some hope, though, that a logjam can be broken and more economic relief can be enacted during a post-election “lame-duck” session of Congress between now and early January.
The central bank has been buying Treasury and mortgage bonds to hold down long-term borrowing rates to encourage spending. And it has kept its key short-term rate, which influences many corporate and individual loans, near zero. Some economists think the policymakers' next move will be to expand its bond buying effort, which is intended to boost the economy by lowering longer-term borrowing rates.
The Fed’s latest policy meeting coincided with an anxiety-ridden election week and an escalation of the virus across the country. Most economists warn that the economy cannot make a sustained recovery until the pandemic is brought under control and most Americans are confident enough to return to their normal habits of shopping, traveling, dining and congregating in groups.
Stocks closed lower Friday, with the Dow shedding 200 points as stocks fell overall for the second week in a row amid rising Russia-Ukraine tensions. Investors are on edge as U.S. officials including President Joe Biden say they expect a Russian attack on Ukraine in the coming days. Aadil Zaman, Partner at Wall Street Alliance Group, joins Closing Bell to discuss today's close, how consumers are shifting their mindset around COVID-19, earnings season, geopolitical tensions, and more.
Coming off of the latest NFL season, Draftkings has plans for growth and new bettors to join its platform following what it saw as a record year of state legalization of sports betting and Super Bowl action. CEO Jason Robins joined Cheddar News to talk about what in store for the company in 2022, including labor issues leading to the postponement of the MLB's spring training games and the NCAA's March Madness. "There's a lot of really exciting stuff that happens in the first couple of rounds all the way through to the championship game. So typically we've seen incredible activity during March Madness on the betting side," Robins said.
PlayersTV is bringing sports viewers Athletes On Demand, a subscription platform to provide fans with thousands of hours of sports content from their favorite athletes. CEO Angela Bundrant joined Cheddar News to discuss the new rollout. "People can expect to receive content or buy into content on demand that comes from their favorite athletes," said Bundrant, listing star partners like the Phoenix Suns' Chris Paul and New Orleans Pelicans' C.J. McCollum.
The New York Stock Exchange has applied for trademark licenses to launch metaverse-, NFT-, and cryptocurrency-related goods, but denies that it has any immediate plans to launch these virtual products. Adam Hollander, the founder of Hungry Wolves NFT, joins Cheddar News' Closing Bell, where he noted such a plan would be "game-changing."
Walmart beat earnings estimates for the fourth quarter, and despite losses stemming from supply chain costs and COVID-19 employee sick leave, the big box chain was still able to fight inflation as costs rose across the board. What's next for Walmart and other retail giants as inflation continues to run hot?
Arun Sundaram, Senior Equity Analyst at CFRA Research, joins Closing Bell to discuss.
Bamboo-based toilet paper company Cloud Paper raised $5 million in a recent funding round. Its product is a bamboo-based alternative to traditional toilet paper made from trees, and its mission is to end the deforestation caused by traditional paper products. Cloud Paper says the raise will allow it to make significant investments in its supply chain, product development, and hiring. Ryan Fritsch, a co-founder of Cloud Paper, joined Cheddar News' Closing Bell to discuss.
