For me, not for thee………
As far as adages go, this one contains the most useful and actionable investment advice of the 21st century. In the wake of the 2008 financial crisis, the ‘Bernanke Put’ was the driving force behind the subsequent stock market rally, and the Fed didn’t bother waiting until after the COVID-19 pandemic to double down on backstopping everything.
What didn’t happen in 2008, and has yet to materialize in 2020, is a similar sentiment for social safety nets. What if we had a fully functioning, highly competitive insurance marketplace where the Federal government agreed to backstop everything?
What if we removed all non compete agreements in the labor market and the Federal government always had a job available for bolt turning?
Too inflationary? Would that be a bad thing right now?