Economic Stimulus for the Middle Market

Diego A. Pacheco, Steve Kesten, Taylor Gaver

March 23, 2020

With response to the Coronavirus Pandemic driving the American economy into downward spiral, on Monday, March 23, 2020, the Federal Reserve announced a host of unprecedented economic measures in an attempt to soften the landing.

In order to help small-and-medium sized businesses, which have been hit particularly hard by the economic effects of the Pandemic, the Fed announced that details would be released soon regarding the Main Street Business Lending Program, which is a program tailored to support eligible small-and-medium sized businesses.  This new lending program is expected to provide sweeping new stimulus for the middle market and supplement programs already in place by the Small Business Administration, including the Economic Injury Disaster Loan program, which allows small businesses to apply for up to $2 million in assistance in the form of low interest rate, extended maturity loans.

Further, the Fed announced the following additional sweeping actions to support and stabilize the securities, money market and bond markets:

  • Facilitating the purchase by the Federal Open Market Committee of Treasury securities and agency mortgage-backed securities;
  • Creating the Primary Market Corporate Credit Facility and Secondary Market Corporate Credit Facility that will support credit for large employers and “provide liquidity for outstanding corporate bonds”;
  • Reviving the Term Asset-backed Securities Loan Facility (TALF), a program developed in response to the 2008 economic crisis that fostered lending to consumers and small businesses;
  • Establishing the Money Market Mutual Fund Liquidity Facility to include a wider range of securities; and
  • Expanding the Commercial Paper Funding Facility to include high-quality, tax-exempt commercial paper as eligible securities.

Click on the link below to see the full announcement from the Federal Reserve: and find us on daily to see our upcoming discussion on more economic stimulus information for the middle market.