The Federal Reserve’s new Main Street Lending Program is being shepherded by economist Lael Brainard ’79, a member of the Federal Reserve Board of Governors. The program is designed to provide up to $600 billion in loans to small- and mid-size companies hurt by the COVID-19 pandemic (especially those too big to qualify under the Paycheck Protection Program).
“The Main Street lending program will rely on banks to help screen applicants and maintain 5% of the loans on their balance sheets. The Treasury, meantime, will offer up $75 billion in cash for the program, and take the first hit on any losses. Those funds are part of a $500 billion pot established by the $2.2 trillion CARES Act passed last month,” reported cnbc.com.
Also according to cnbc.com, Lael’s “role in the program, which is being conducted under a Republican administration, is notable given her Democratic ties.” She was previously the undersecretary of the treasury for international affairs under President Barack Obama and an economic advisor to President Bill Clinton.