According to The Wall Street Journal, our present administration had the Federal Reserve identify companies, including Apple, Verizon, Berkshire Hathaway and Walmart, whose bonds it will be buying as part of a $500 billion effort to support the stock market. These are some the largest companies in the country. Apple’s estimated value is two trillion dollars. Why do they need our tax dollars to support the market for their bonds? If they need cash, they should sell more stock. Currently it’s valued at more than $400 a share.
The average share of the half trillion dollars for each of the 894 companies would be $559, 284,116! I did round up.
Currently we have thousands of businesses across our nation that have been hanging on because of federal aid but that aid is now running out. These businesses and the jobs they provide are the glue that holds our communities together. Why would this administration select eight hundred-plus corporations and provide them with a half trillion-dollar credit windfall? Where will this half a trillion dollars come from? Will we print it or borrow it? If we borrow it, will the interest rate ratio, between the bonds we sell to raise the half trillion and the bonds we buy to support these companies’ growth, afford us a net profit?
I can’t comprehend the logic of this huge infusion of our dollars into some of the largest companies in the world, but then I am not a financial wizard like President Trump.
I hope Representative Paul Mitchell would enlighten us on the administration’s reasoning and logic behind such a huge outlay of our dollars to so few companies when so many companies need help.
If I were a CEO of one of these companies and had a five hundred-million-dollar line of credit available to me the first thing I would do is give myself a big raise and a fat bonus and then write a large campaign contribution check to the political party of my choice.
What would you do?