Having flashbacks to late-2007/early-2008. I was in business school & you could see cracks in the logic of the bankers on Wall St. If you were watching the markets & you knew anyone on Main St who was cobbling together bills on a monthly basis, you knew there was a disconnect 1/

This feels like the same thing. 6.6M filing for unemployment. Many people already not paying rent (b/c they have 0 dollars in the bank because they have been living month-to-month for years (not just the past month). They are deciding between electricity bills and food; 2/

between rent and food. Large companies are laying people off, implementing hiring freezes, reducing salaries. Small companies are just shutting down because they, like many of the people who work for them, operate month-to-month. Banks charged w/implementing lending programs 3/

can't get the money out the door quickly enough because they're either unwilling to take on additional risk or they don't have the staff in place to implement swiftly and efficiently. Huge disparity between the savings rate of the top 1% vs. bottom 90%. Skews the perception 4/

of those in the banking classes. They don't understand how ugly things will really get because they've got massive personal savings and don't know any people in the bottom 90%. They can't possibly understand or be empathetic for people who have to decide which bills to pay. 5/

And even if they did, they don't care. They're looking for ways to capitalize on the situation & take care of their clients. They also know that they're going to get bailed out, b/c they always get bailed out. Always. Their friends are the ones who are making these decisions. 6/

And it turns out they're right. Here's the Fed. Stepping in. Hoisting up CLOs (which is crazy). Purchasing shares. Purchasing shares?! Creating moral hazard-again. 7/ https://www.cnbc.com/2020/03/29/what-it-would-take-for-the-fed-to-start-buying-stocks-during-coronavirus-crisis.html

"Is there any limit to the amount of money that the fed can lend?"

Powell: "we can keep doing that as long as those needs arise. There is no limit on how much we can do....one thing I don't worry about is inflation right now." 8/

How is the market responding to all of this? It's in the green, of course. Dow is up 1.85% right now. Banks are going to clean up because the fed is going to take

When asked "what about the waitress at your local restaurant? How does this help her?" 9/

Powell: "the most important thing that she can do is stay home and stay healthy...She'll probably find that it is hard to get access to that right away, b/c there are backups at the unemployment offices."

Clearly, he's never worked as a waitress or had 0$$ in savings. 10/

How does he think "she" is going to eat over those two weeks? How is she going to survive on $600/week? Pay rent? Pay electricity?

What's the answer? Well, let's buy some mortgage-backed securities. Let's dip our toe into CLOs. Let's dip our toe into buying some equities. 11/

Gotta tell you, this isn't going to help her. It is, of course, going to help big business, the banks, the top 10% whose savings is in equities. This is not going to help her. And that's why you see the market responding the way that it is. 12/

The thing is, it is still going to get worse. A lot worse. Businesses aren't going to rehire for months, if they even decide to rehire at all. Rent and mortgage payments that are currently being deferred are going to have to be paid at some point, crowding out spending. 13/

Student loans are going to continue to crowd out spending. Increased insurance costs, which are poised to go up 40%, are going to crowd out spending. Inflation is going to kill the most vulnerable. And we're going to continue to plow cash into big business and banks. 14/

This is going to cost us so much more because the government isn't just making the politically unpalatable decision to just give direct support to the 90%. SMH.