Archive - Feb 2013 - Blog entry

Gold is trading flat today near a one and a half week high hit yesterday as Federal Reserve Chairman Ben Bernanke defended the U.S.  ultra loose monetary policy.

The selloff in gold ETFs in February underscores the weakness in gold sentiment among retail investors that has been prominent recently. 

Bernanke: "None of the things you said are accurate"

Corker: "Oh yes they are"

Abe's honeymoon is over. Read why.

Ben was in congress campaigning er, testifying mostly about the effectiveness of all things ZIRP and QE. He was grilled about possible risks with QE especially if interest rates should rise. The Bernank saying that interest rates would rise was unlikely but he then cavalierly stated if rates rise, the Fed would just “hold back on payments” er, stiff the Treasury. That’s no big deal for him since by then he’ll be down the road writing his memoirs, making speeches and joining some big Wall Street firm as a well-paid consultant. The Bernank was also asked if he noted any bubbles or market excess and said he saw none. 

Fed officials are well aware that stocks have become totally disconnected from reality. However, they cannot simply come out and discuss ending stimulus efforts outright because it would cause a market collapse. Remember, the single most important role for the Fed post-2008 is to maintain confidence in the system. So they cannot risk any explicit statement that they will be pulling the punchbowl.

The 2011 changes by the FDIC to the safe harbor for "true sales" may have been the end of "Too Big To Fail."

Of rats and men...

Monday's selloff gives us opportunities pick up stocks for less and to write additional puts at better prices. 

Someone ended up holding the bag

I heard Ben say, "Buy gold and short bonds".

One of the least well-known precious metals continues to shine brightly this year - palladium.

Italy is driving the markets. Japanese developments means the market is closer to give Abenomics its first test. Bernanke to set the record straight after many gave the regional non-voting Fed presidents too much weight in understanding trajectory of Fed policy.

Market reform still has a ways to go but the turn around on special order types is welcomed and comes with a warning to the SEC to not sit back in front Brazzers for long as more work still needs to be done. 

Waste and Fraud Are the Real Causes of the Deficit

It's a cat and mouse game, only you're unable to realise that you were neither to begin with.