Recently, there has been some support for suspending rent and mortgage payments, the goal being to provide financial relief during the Covid-19 response.
I'm wondering what the impacts for the economy would be if this was put in place. Here is what I could think of...
- Obviously, this would provide relief for those feeling the economic effects
- It could impact the bank's reserve rate, because they aren't getting payments
- The Fed owns a considerable amount of mortgage backed securities, a market that I assume would be impacted.
Are these valid concerns, or are there larger ones I'm missing? I'm not advocating for or against the policy, just trying to think through it's impact.