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Financial Drops of Ford, The Fed, and The Bond Market Amid COVID-19 Pandemic

With the widespread COVID-19 outbreak, almost all companies are facing financial risks and challenges. The economy has completely gone down and there is still no signal how it can be set to normal like earlier in no time. Every existing industry is coming up with the strategies to upscale the market and on the other side with no profits in the businesses employment rate has also decreased.

So there are a few giant companies who are almost down with finance. Ford is in big trouble as the United States manufacturing operations are shutting down and there is no date to resume the market. Moreover, right from European operations, Mexican plants have shut down and with this critical situation, the loss of billions are estimated. The firm has drawn down its entire credit line. Ford has stated that there has been only six months of cash left to survive the company finance.

On April 9, the Federal Reserve made an announcement of expanding its program of buying bonds in the market. The Fed promised “unlimited buying” of government bonds in what one pundit called “QE Infinity”. It was the proposal for a qualitative metamorphosis of the QE program. Moreover, the treasury bonds and government-back mortgage bonds.

Ford urgently needs to raise new money to deal with the impact of the crisis, but until April 9. A company with impaired credit might become very puzzled for the customers. Ford narrowly avoided the bankruptcy fate in 2008. The market value of Ford is valued at $20 Bn.

There are no predictions that when the market will reopen and settle down the economy like earlier. Though it will be needing more six months to settle down the things at best.