Jamie Dimon Expects a ‘Bad Recession’

Bill Ackman is an optimist now

The hedge fund billionaire captured Wall Street’s attention for his panicky appearance on CNBC last month, when he said, “Hell is coming.” Now, it appears he’s in much better spirits.

“I am beginning to get optimistic,” Mr. Ackman tweeted yesterday, citing what he believed to be a slowing rate of infection in New York, a potentially lower-than-expected Covid-19 fatality rate and other signs.

That newfound cheer ran up against skeptics who recalled his previous outburst a few weeks ago. (A reminder: Mr. Ackman fretted that shares in Hilton could sink to zero, then later revealed that he had bought shares in the hotel chain and generated more than $2 billion in returns on short bets.) One Twitter user pithily responded to Mr. Ackman’s newfound optimism: “Is this because you’ve gone long now?”

Apollo’s quest to open up Fed lending

America’s central bank has pledged to provide billions of dollars to businesses through one of its lending programs, known as TALF. But the giant investment firm Apollo thinks the Fed can do much more.

It thinks the Fed should expand TALF to accept more types of collateral, according to a presentation prepared by Marc Rowan, an Apollo co-founder. TALF, short for Term Asset-Backed Securities Loan Facility, was last used during the 2008 crisis. It accepts only some kinds of debt assets — chiefly securitized bundles of credit card, auto loans or small business loans — that carry the highest possible credit ratings.

• The Fed should accept more types of assets, Mr. Rowan says, including other kinds of mortgages, certificates of deposit and short-term business loans known as commercial paper, across the investment-grade spectrum.

Article source: https://www.nytimes.com/2020/04/06/business/dealbook/jpmorgan-jamie-dimon-letter.html