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The Fed is going to launch in a few days for loans to medium-sized businesses

The u.s. Federal Reserve (Fed) should start in the help to medium-sized businesses in just a few days after a long period of time to develop this instrument is unprecedented, promised on Friday his boss, Jerome Powell.

read also : The Fed renews its commitment to keep interest rates close to zero

"We believe start these loans in a few days", said the chairman of the u.s. central Bank in a video conference for the University of Princeton. These loans are targeted at businesses too small to be able to finance themselves on the stock Exchange, but too large to benefit from the loans provided by the stimulus of the economy american, and for which the Congress and the administration Trump have released 849 billion in two tranches. This program is so "companies that are in the middle, and this is very difficult because (...) the credit needs of different types of companies in different sectors are extraordinarily diverse," commented Jerome Powell.

The companies involved are those who were in good health prior to the crisis, have fewer than 15,000 employees and an annual turnover of up to $ 5 billion. The amount of the loans will be from 500,000 to more than $ 100 million. "It is about creating the conditions (...) for employees to have the best chances of maintaining their employment, to return to their former jobs or, finally, to find a new one", pointed out Jerome Powell.

40 million request for unemployment benefits

Since the beginning of the crisis, more than 40 million Americans have asked for an unemployment allowance. They are currently 21 million to benefit, the other may not claim, or have been able to return to work. The historical peak of beneficiaries of unemployment had been reached during the first week of may, with nearly 25 million people.

The u.s. Treasury will pay out $ 75 billion for this program, recorded in the gigantic us stimulus package of the economy, had indicated the Fed at the end of April in a press release announcing that the program would be accessible to a higher number of firms than originally intended. The Fed, which has deployed an arsenal of measures since the beginning of the crisis in march, to allow companies to quickly resume after the storm, has also set up another lending facility for companies that have access to equity markets.

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