Monday, July 6, 2015

7/6/15 China shows what the US can do to stop a stock market decline

Have the central bank print money to make loans to brokerage firms to use for margin lending.

Cut interest rates.

Reduce bank reserve requirements.

Suspend IPOs (in order to reduce the number of shares available for trading to help keep supply short of demand).

Let companies voluntarily suspend trading in their stocks on the exchanges if their stock is declining.

Expand collateral for margin loans to include equity in homes on top of existing art work and antiques.

Have the central bank print money for a reserve fund to buy stocks (ETFs and mutual funds) directly.

Keep the housing boom going as a way to support stocks buy having the central bank print money to buy the debt of local governments which debt was used for real estate financing.


Ban pension funds from selling stocks in their portfolio.

 

It seems to be working.

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