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Bill Gross: "No QE 3"

Tyler Durden's picture


The latest soundbite from Bill Gross comes from the Morningstar fund conference, where he again repeated his conviction that there will be no QE3. Reuters reports: "Pimco co-chief investment officer Bill Gross said the Federal Reserve would not be able to start a third round of quantitative easing after the second round expires at the end of this month. The members of the central bank's open market committee are "balanced but divided," Gross, manager of the world's largest bond fund, said on Wednesday in a speech at the Morningstar fund conference. "It will be difficult to initiate a QE3." Instead, the Fed will try to keep interest rates low with its official statements, Gross said.  Gross's fund, the $243 billion Pimco Total Return Fund, has gained 3.24 percent so far this year, trailing 58 percent of similar funds, according to Morningstar data."

It is odd that Bill continues to stick to his guns in light of both the economic deterioration and the market realization that there will need to be a major drop in stocks for further easing. Ironically, Gross should realize that absent more easing, there will be continued transfer of capital from equities into bonds for the time being (thereby further impairing his, yes, short position), and with the world slowing down and global central bank tightening, a global re-recession (deep in the depression that started in December 2007) seems inevitable. The paradox is that absent QE3 to force a capital reallocation out of fixed income into stocks but mostly commodities, PIMCO's TRF will continue to be unprofitable (even more if the fund has a steepener position on as many have speculated). The only wildcard is if there is a tax repatriation holiday which we believe has about a 30-40% chance of passing in temporary lieu of QE3.

Nonetheless, if indeed Gross believes there is no QE3, his increasing UST short position may be precariously positioned. We expect to get an update of the TRF positioning over the next 48 hours. It should prove quite informative on what Gross thinks now (and we completely ignore the discussion of "who will buy US debt" in the absence of the Fed, which is an unresolver quandary we share with Gross).


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Wed, 06/08/2011 - 17:17 | 1352475 camaro68ss
camaro68ss's picture

No QE3, but...but... i need my fix man. (scraching arms)

Wed, 06/08/2011 - 17:31 | 1352541 DutchZeroPrinter
DutchZeroPrinter's picture

It won't be bullish for UST, not even in the short term. Dollar and UST are no safe haven anymore. When the economy comes crashing through the floor, creditor nations will get out as fast as possible.

Wed, 06/08/2011 - 17:32 | 1352554 HpDeskjet
HpDeskjet's picture

To what? There is no market liquid/big enough to absorb that amount of money (yet)... If US continues down the current fiscal path, for sure the $ will be destroyed, but this point won't be reached for longer than most people think 

Wed, 06/08/2011 - 17:40 | 1352588 hack3434
hack3434's picture

Common misconception...Captical can and will be lost. The real question is who and how fast they can outrun the others. 

Thu, 06/09/2011 - 08:32 | 1354038 GetZeeGold
GetZeeGold's picture


Is it just me.....or do I not detect a whiff of ozone and a hint of panic?


Wed, 06/08/2011 - 19:57 | 1353000 unum mountaineer
unum mountaineer's picture

crack is whack Cam

Chapelle's Tyrone biggums came to mind

Wed, 06/08/2011 - 17:44 | 1352592 I think I need ...
I think I need to buy a gun's picture

aka gold revaluation

Thu, 06/09/2011 - 02:34 | 1353810 Michael
Michael's picture

Stop it, stop it, stop the speculation right now on whether or not there is going to be QE3. Jut stop it! They made a below 3% yield for a cushion on the 10 year you fucking morons. There absolutely will be QE3 when the 10 year moves back to it's nominal drop dead value of 3.5%, maybe 3.75% and panic sets in at that point.

The world will come to an end if there is no QE3. There will be QE3 come hell or high water. Can I make it any more clearer for you fucking morons?

Thu, 06/09/2011 - 08:29 | 1354040 GetZeeGold
GetZeeGold's picture


I believe you've made that perfectly ucking clear.


Wed, 06/08/2011 - 21:12 | 1353206 Re-Discovery
Re-Discovery's picture

Gross believes in Financial Repression theory which is a variant of loose monetary policy not technically QE.  he believes Fed will target inflation at 4-5 % for a long period of time to reduce debt.

He is making "No QE" call to tank bonds when Fed leaves as a buyer (prices tank) and validates his anti-treasury stance.

Under financial repression theory over the longer term, the TBTF step in to buy bonds when Fed exits because the Fed forces them to.

Wed, 06/08/2011 - 23:36 | 1353563 trav7777
trav7777's picture

Dunno how the USG is going to fund...not with sustained $2T deficits, that is.

The wars can't end because the oil supply is dwindling.

The Fed will print when the government puts a gun to their head

Thu, 06/09/2011 - 03:10 | 1353835 BorisTheBlade
BorisTheBlade's picture

Maybe Gross is right, QE sounds bad already. Time to rebrand it, then run for a couple more iterations.

Wed, 06/08/2011 - 17:18 | 1352480 Boston
Boston's picture

No QE3?


.....for Treasuries.


Wed, 06/08/2011 - 17:33 | 1352556 Dr. No
Dr. No's picture

Please explain.  I would expect the removal of $700B in demand to put pressure on prices.

Wed, 06/08/2011 - 17:45 | 1352594 Hugh G Rection
Hugh G Rection's picture

No QE3


Either they're rebranding under a new name, or its straight to QE4

Wed, 06/08/2011 - 17:55 | 1352641 Conrad Murray
Conrad Murray's picture

Who needs QEanything when you have a Marxist president, a neutered and captured Congress, and a complacent, if not outright treasonous, judiciary. This is end game for America. October 26, 2001 Lady Liberty was gutted like a hog. October 3, 2008 the markets were sacrificed to the demons of central planning.

Either the tree gets watered, or it will surely die.

Wed, 06/08/2011 - 18:53 | 1352844 Hugh G Rection
Hugh G Rection's picture

I agree, but you completely left out the Federal Reserve and its cabal of international banksters.  America started to die after the federal reserve act in 1913, the monetary terrorists have been bleeding us damn near a hundred years.

Thu, 06/09/2011 - 09:06 | 1354102 WonderDawg
WonderDawg's picture

 "a neutered and captured Congress"

You're not helping matters by buying into and perpetuating the euphamisms so prevalently used by the MSM. "Captured"? Call it what it is. Corrupt. Bought and paid for. Owned. Congress is corrupt and on the take. Captured sounds like some kind of kids game. Call a spade a spade. The motherfuckers are corrupt.


Thu, 06/09/2011 - 12:30 | 1354773 el Gallinazo
el Gallinazo's picture

Comrade, maybe it's time for you to learn the difference between Marxist and fascist. I am not a big fan of either one, but it's nice not to flaunt your ignorance. Obama talked like a moderate liberal running for election, but his policies, like Bush's, both foreign and domestic, have been totally fascists. Marxists do not hand the government over to the giant corporations.

Thu, 06/09/2011 - 13:34 | 1354977 Conrad Murray
Conrad Murray's picture

Fascism/Marxism, merely different sides of the socialist spectrum.

Obama most certainly did not talk like a moderate. He spoke of spreading the wealth around, and having energy rates necessarily skyrocket under his administration(which he most certainly followed up on by bringing Steven Chu aboard as US Energy Secretary, who said, "Somehow we have to figure out how to boost the price of gasoline to the levels in Europe") all while attending a church of pure hate( ).

The only people that thought he was a moderate were those not paying attention. The people who parrot whatever the talking heads tell them to, such as the lie that he is eloquent: He has a teleprompter and nothing more. He doesn't know how many states there are( ), and he doesn't even know what year it is( ). These are the same idiots that voted for him out of spite for Bush or to prove they are "post-racial", whatever the hell that is.

I'll give you Bush, but if Obama were a fascist he would be more homeland(USA, not Kenya) orientated. He wouldn't bow down to leaders all over the world apologizing for the past, he would firm up. Sure, there is plenty of corporatism left over from previous administrations, and Barry Soetoro isn't helping much, but Barack Hussein Obama wants global communism. He is a Marxist through and through.

In any case, if you want to quibble over terms instead of focusing on the issues, how about we agree to refer to all of it as Statism or Authoritarianism? Or maybe delusional mass-murder inducing bullshit...

Thu, 06/09/2011 - 14:28 | 1355158 GoinFawr
GoinFawr's picture

Oh, so it`s `quibbling` if you get called on misnoming one political ideology because you erroneously superimposed it onto its polar opposite? That is propagating the sort of misinformation that anyone should take issue with.

I recommend you update your lexicon if you want to be taken seriously.

Wed, 06/08/2011 - 19:32 | 1352938 Fur Trader
Fur Trader's picture

That's truth; thanks to ZH, 'QE3' will be called anything but that.    We should start a tracking sub-blog pool here on what it will be known as.

Wed, 06/08/2011 - 20:18 | 1353053 Hugh G Rection
Hugh G Rection's picture

How about Qualitative Fleecing?

Thu, 06/09/2011 - 13:07 | 1354898 Nathan Muir
Nathan Muir's picture

Certainly more appropriate! Although "money printing" rolls off the tongue nicely and sums it up perfectly.

Wed, 06/08/2011 - 23:54 | 1353619 Rational Psycho
Rational Psycho's picture

Certainly some acronym that means the opposite of what the program does. How about Highly Effective Liquidity Purchases Under Soveriegn Authority, HELP USA.

Wed, 06/08/2011 - 18:42 | 1352795 Bonesetter Brown
Bonesetter Brown's picture

See Irving Fisher

Wed, 06/08/2011 - 19:08 | 1352887 Boston
Boston's picture

One explanation is based on studying what happened the last time QE ended in the spring of 2010. Counter-intuitively, Treasury prices soared, taking the 10 year down to under 2.4% by early fall 2010.

There is no overwhelming reason why Treasuries would behave differently this time.  In fact, this argument is already supported by the "surprising" (hello Bill Gross!) Treasury rally we've seen over the last six weeks.

(BTW, I don't comment here often, but I've been yapping about the LONG Treasury trade here for over two months)

Wed, 06/08/2011 - 17:19 | 1352491 RobotTrader
RobotTrader's picture

The market has spoken.

The PigMen have decided to allow the market to clear on its own accord and find its own level without any assistance from the Fed.

Wed, 06/08/2011 - 17:24 | 1352496 Deep
Deep's picture

Flip flop Cramer. STFU

Wed, 06/08/2011 - 17:26 | 1352517 Rynak
Rynak's picture

Since when is the market the bernanke and goldman? Oh wait.... nevermind..... that actually makes sense. The only problem is that this "The market" seems to contradict its own data all the time.

Wed, 06/08/2011 - 17:25 | 1352518 HamyWanger
HamyWanger's picture

Robot, bro', I'm beginning to be worried too about a possible stocks correction. XRT has started to fall like a stone and LNKD has not been supported by the Pigmen like I had anticipated. 

Wed, 06/08/2011 - 18:06 | 1352656 Sancho Ponzi
Sancho Ponzi's picture

OT: Cullen Roche takes Jamie Dimon behind the woodshed. Enjoy!

Via PragCap:

Wed, 06/08/2011 - 18:39 | 1352761 cosmictrainwreck
cosmictrainwreck's picture

I like the close "thank yer stars & shut up" but sure wish he'd have gone with "just STFD & STFU, ya asshole!"

Wed, 06/08/2011 - 18:26 | 1352733 Fiat2Zero
Fiat2Zero's picture

You and robot are such obvious agents of the ChairSatan that it is disturbing.

Wed, 06/08/2011 - 21:40 | 1353305 dark pools of soros
dark pools of soros's picture

or they are just E-trade babies

Wed, 06/08/2011 - 17:21 | 1352519 Deep
Deep's picture

Ok Cramer.

Wed, 06/08/2011 - 17:35 | 1352566 LongBalls
LongBalls's picture

And the buyer of $1+ Trillion dollar treasuries will be? And the Treasury will pay back the pension fund money it has borrowed while awaiting congress to raise the debt ceiling how?

Wed, 06/08/2011 - 18:09 | 1352662 css1971
css1971's picture

Someone like me possibly, at 12%


Wed, 06/08/2011 - 17:24 | 1352495 Smokey1
Smokey1's picture

Gross may well be full of shit. If the Dow backs off about a thousand points, the Bernanke  will not hesitate to continue with QE.

Bernanke's probably going to do QE anyway, because his heart is set on it and it is what he does. But he would love the cover provided by a nasty drop in stocks.

Wed, 06/08/2011 - 17:30 | 1352534 rbjmartin
rbjmartin's picture

My thoughts exactly, although I don't think it will take another thousand points to spook Fed board members into begging for more QE. Another 400 to 500 points down, more weak GDP numbers, unemployment constant around 9% to 10%, and sinking real estate prices will leave them with no choice.

Wed, 06/08/2011 - 20:30 | 1353085 WonderDawg
WonderDawg's picture

In a word: bullshit. The Dow is down about 850 since early May and not a peep about QE3, other than the wishful thinking bulls. Unemployment has been around 9-10% for a couple of years now, and the previous QE's did nothing to improve that. Real estate prices have another 40-50% down before they touch any kind of bottom, and the Fed can do nothing to change that, and everyone knows it. It will take several thousand points more off the Dow before the will to throw more money away will reach the tipping point, and at that point it will be too late to make a difference. IMO. 

Wed, 06/08/2011 - 21:46 | 1353315 dark pools of soros
dark pools of soros's picture

QE is not about making the country better..  it's about making the country better for the banksters

Wed, 06/08/2011 - 18:11 | 1352686 Strider52
Strider52's picture

Every time I go to Ireland there is a financial calamity. I arrive in Dublin in 16 days.

 Prepare accordingly.

Wed, 06/08/2011 - 21:47 | 1353320 dark pools of soros
dark pools of soros's picture

are they asking YOU to bring scotch to them yet?

Thu, 06/09/2011 - 00:00 | 1353622 Rational Psycho
Rational Psycho's picture

In insolvent Ireland, scotch drink you!

Wed, 06/08/2011 - 17:24 | 1352498 Mae Kadoodie
Mae Kadoodie's picture

an enigma trapped inside a riddle.

Wed, 06/08/2011 - 17:31 | 1352539 ursus.peracto
ursus.peracto's picture

Throttle down on the clichès.

Wed, 06/08/2011 - 17:25 | 1352523 Smokey1
Smokey1's picture

Gross may well be full of shit. If the Dow backs off about a thousand points, the Bernanke  will not hesitate to continue with QE.

Bernanke's probably going to do QE anyway, because his heart is set on it and it is what he does. But he would love the cover provided by a nasty drop in stocks.

Wed, 06/08/2011 - 22:16 | 1353398 tekhneek
tekhneek's picture

There's no reason to debate it. There will be QE3. It really is that simple.

Imagine what they were saying about QE2 near the ending of QE1.

Buy as much AGQ as you can. I give it 2 weeks before they announce more "fiscal stimulus" regardless of the naming.

Wed, 06/08/2011 - 17:23 | 1352526 Conrad Murray
Conrad Murray's picture

Who will buy debt? Why, your 401k/pension/IRA and whatever the hell else they can find. Bend over and take it debt slave. Come on, squeal like a pig! SUCKERS!!!

Wed, 06/08/2011 - 17:29 | 1352536 carbonmutant
carbonmutant's picture

If the Department of Education is breaking into people's houses to collect on student loans this government is desparate for money.

Wed, 06/08/2011 - 19:05 | 1352875 Sockeye
Sockeye's picture

Wake up people! This is fascism.

Wed, 06/08/2011 - 20:55 | 1353159 Medea
Medea's picture

Preacher, meet choir.

Wed, 06/08/2011 - 21:51 | 1353334 dark pools of soros
dark pools of soros's picture


In September 2009, Jeffrey Stearns, a concrete-company owner, answered a knock at the door from a Hancock County, Ind., deputy sheriff. The deputy was holding a warrant to arrest Mr. Stearns for not paying $4,024.88 owed to a unit of American International Group Inc. on a loan for his pickup truck.

After being handcuffed in front of his four children, Mr. Stearns, 29 years old, spent two nights in jail, where he said he was strip-searched and sprayed for lice. Court records show he was released after agreeing to pay $1,500 to the loan company. "I didn't even know I was being sued," he said, though he doesn't dispute owing the money. "It's the scariest thing that ever happened to me."

Wed, 06/08/2011 - 17:29 | 1352542 Deep
Deep's picture

I am begingging to think that QE3 will be a no go. And even if it hits, i dont think it will have the effect that everyone thinks it will have. The debt overhang is too much.

Anyone who thinks that QE3 will be a replay where we rally 30% is kidding themeselves

Wed, 06/08/2011 - 17:34 | 1352549 Spalding_Smailes
Spalding_Smailes's picture

We will rally 30% because the economy will hit overdrive over the next 6 quarters ....

Wed, 06/08/2011 - 18:04 | 1352658 css1971
css1971's picture

Oil to the MOON!

Wed, 06/08/2011 - 17:29 | 1352543 Spalding_Smailes
Spalding_Smailes's picture

Officials for heavy-equipment manufacturer Caterpillar Inc. of Peoria, Ill., said Wednesday they could see adding a new shift at its North Little Rock motor grader plant as demand for its machinery improves. "The mining business coming back strong and products sales are picking up in a big way," spokesman Rusty Dunn said at the Fortune 500's company's annual meeting at Little Rock's Peabody Hotel.

Caterpillar makes construction and mining equipment, diesel and natural gas engines and industrial gas turbines. It makes a line of motor graders at a new plant in North Little Rock. Dunn said the North Little Rock plant is at about one-third capacity now, leaving room for more production. The company sees signs that demand for its products could soon grow.

Chief Financial Officer Edward Rapp said May 19 that the company expects the U.S. economy will grow by about 3 percent in 2012. He said growth of 3.5 percent to 4 percent should kick off demand for new heavy machinery like the company's construction equipment.

Wed, 06/08/2011 - 17:35 | 1352552 Fancy Bear
Fancy Bear's picture

CAT has been a good emerging market play.

Wed, 06/08/2011 - 17:37 | 1352559 zaknick
zaknick's picture

Here's to you and that scum topcallingtroll:

In 1789 Alexander Hamilton became the first Treasury Secretary of the United States.  Hamilton was one of many Founding Fathers who were Freemasons. He had close relations with the Rothschild family which owns the Bank of England and leads the European Freemason movement.  George Washington, Benjamin Franklin, John Jay, Ethan Allen, Samuel Adams, Patrick Henry, John Brown and Roger Sherman were all Masons.

Roger Livingston helped Sherman and Franklin write the Declaration of Independence. He gave George Washington his oaths of office while he was Grand Master of the New York Grand Lodge of Freemasons.  Washington himself was Grand Master of the Virginia Lodge.  Of the General Officers in the Revolutionary Army, thirty-three were Masons.  This was highly symbolic since 33rd Degree Masons become Illuminated. [1]

Populist founding fathers led by John Adams, Thomas Jefferson, James Madison and Thomas Paine- none of whom were Masons- wanted to completely severe ties with the British Crown, but were overruled by the Masonic faction led by Washington, Hamilton and Grand Master of the St. Andrews Lodge in Boston General Joseph Warren, who wanted to “defy Parliament but remain loyal to the Crown”. St. Andrews Lodge was the hub of New World Masonry and began issuing Knights Templar Degrees in 1769. [2] 

All US Masonic lodges are to this day warranted by the British Crown, whom they serve as a global intelligence and counterrevolutionary subversion network. Their most recent initiative is the Masonic Child Identification Program (CHIP). According to Wikipedia, the CHIP programs allow parents the opportunity to create a kit of identifying materials for their child, free of charge. The kit contains a fingerprint card, a physical description, a video, computer disk, or DVD of the child, a dental imprint, and a DNA sample.

The First Continental Congress convened in Philadelphia in 1774 under the Presidency of Peyton Randolph, who succeeded Washington as Grand Master of the Virginia Lodge.  The Second Continental Congress convened in 1775 under the Presidency of Freemason John Hancock.  Peyton’s brother William succeeded him as Virginia Lodge Grand Master and became the leading proponent of centralization and federalism at the First Constitutional Convention in 1787.  The federalism at the heart of the US Constitution is identical to the federalism laid out in the Freemason’s Anderson’s Constitutions of 1723. William Randolph became the nation’s first Attorney General and Secretary of State under George Washington. His family returned to England loyal to the Crown.  John Marshall, the nation’s first Supreme Court Justice, was also a Mason. [3]

When Benjamin Franklin journeyed to France to seek financial help for American revolutionaries, his meetings took place at Rothschild banks.  He brokered arms sales via German Mason Baron von Steuben.  His Committees of Correspondence operated through Freemason channels and paralleled a British spy network.  In 1776 Franklin became de facto Ambassador to France.  In 1779 he became Grand Master of the French Neuf Soeurs (Nine Sisters) Lodge, to which John Paul Jones and Voltaire belonged.  Franklin was also a member of the more secretive Royal Lodge of Commanders of the Temple West of Carcasonne, whose members included Frederick Prince of Whales. While Franklin preached temperance in the US, he cavorted wildly with his Lodge brothers in Europe.  Franklin served as Postmaster General from the 1750’s to 1775 – a role traditionally relegated to British spies. [4]

With Rothschild financing Alexander Hamilton founded two New York banks, including Bank of New York. [5]  He died in a gun battle with Aaron Burr, who founded Bank of Manhattan with Kuhn Loeb financing.  Hamilton exemplified the contempt which the Eight Families hold towards common people, once stating, “All communities divide themselves into the few and the many.  The first are the rich and the well born, the others the mass of the people…The people are turbulent and changing; they seldom judge and determine right.  Give therefore to the first class a distinct, permanent share of government.  They will check the unsteadiness of the second.”[6]

Hamilton was only the first in a series of Eight Families cronies to hold the key position of Treasury Secretary.  In recent times Kennedy Treasury Secretary Douglas Dillon came from Dillon Read (now part of UBS Warburg). Nixon Treasury Secretaries David Kennedy and William Simon came from Continental Illinois Bank (now part of Bank of America) and Salomon Brothers (now part of Citigroup), respectively. Carter Treasury Secretary Michael Blumenthal came from Goldman Sachs, Reagan Treasury Secretary Donald Regan came from Merrill Lynch (now part of Bank of America), Bush Sr. Treasury Secretary Nicholas Brady came from Dillon Read (UBS Warburg) and both Clinton Treasury Secretary Robert Rubin and Bush Jr. Treasury Secretary Henry Paulson came from Goldman Sachs. Obama Treasury Secretary Tim Geithner worked at Kissinger Associates and the New York Fed.

Thomas Jefferson argued that the United States needed a publicly-owned central bank so that European monarchs and aristocrats could not use the printing of money to control the affairs of the new nation.  Jefferson extolled, “A country which expects to remain ignorant and free…expects that which has never been and that which will never be.  There is scarcely a King in a hundred who would not, if he could, follow the example of Pharaoh – get first all the people’s money, then all their lands and then make them and their children servants forever…banking establishments are more dangerous than standing armies.  Already they have raised up a money aristocracy.” Jefferson watched as the Euro-banking conspiracy to control the United States unfolded, weighing in, “Single acts of tyranny may be ascribed to the accidental opinion of the day, but a series of oppressions begun at a distinguished period, unalterable through every change of ministers, too plainly prove a deliberate, systematic plan of reducing us to slavery”. [7[

Wed, 06/08/2011 - 17:45 | 1352599 Spalding_Smailes
Spalding_Smailes's picture



1976 - $2 T

1984 - $4 T

1991 - $6 T

1997 - $8 T

2000 - $10 T

2007 - $14 Trillion

Wed, 06/08/2011 - 18:11 | 1352687 zaknick
zaknick's picture

Funny money, motherfucker, funny money. All of that paper wealth has accrued to the elites not ppl like you, moron.

All you have to know is that before one parent's blue collar income paid for all expenses including vacations and college tuition. That was the American Dream you so eagerly dismiss in favor of the Banksters/KKK Empire.

To those of you who junk Truth and the words of true freedom loving men Thomas Jefferson:


Wed, 06/08/2011 - 18:19 | 1352705 Spalding_Smailes
Spalding_Smailes's picture


NEWARK, N.J.June 8, 2011 /PRNewswire/ -- U.S. containerized exports jumped 12.5 percent, year-over-year, in April, to a total of 1,076,113 20-foot equivalent units, the 19th consecutive monthly year-over-year expansion for U.S. exports, said Mario O. Moreno, economist for The Journal of Commerce and PIERS. The growth comes after a 13.9 percent year-over-year growth in March and left U.S. containerized exports up 12.3 percent through the first four months of the year.

"Despite a cooling in the manufacturing sectors of China and other key U.S. markets, U.S. containerized exports continued growing by a double-digit pace, partly aided by a weak U.S. dollar whose foreign value against a basket of major currencies fell again in April, this time by 1.8 percent over the average of March," said Moreno.

Gains were mostly driven by demand for paper and paperboard, up 12 percent or 15,766 TEUs; fabrics, including raw cotton, up 33 percent or 10,005 TEUs; and logs and lumber, which grew by 34 percent or 9,064 TEUs. Outbound shipments of motor vehicles displayed remarkable gains as well, jumping by 40 percent to a total of 40,526 TEUs. On the downside, pet and animal feeds fell by 19 percent or 10,420 TEUs, to a total of 43,711 TEUs.


Wed, 06/08/2011 - 18:33 | 1352738 kito
kito's picture

spalding, some of these folks just cant grasp that commerce still exists!!! yes, entities still produce, sell, service, ship, and consume!! amazing! and yes, corporations have not fared too badly considering the downturn!!

Wed, 06/08/2011 - 18:41 | 1352792 zaknick
zaknick's picture


This is Fight Club, bitch!!!!

Anybody can go through my comments and see my track record. I have been analyzing humanity (and therefore commerce as well) for over 10 years. I know what's really going on not just now like you but in its historic context while following the key hidden architects of this "commerce" you mention; a truly malevolent system of slavery is all it is.

Like I said before, globalization was always a cover for KKK/Bankster empire.

Wed, 06/08/2011 - 18:58 | 1352849 kito
kito's picture

i commend you for your long term humanalysis.

Wed, 06/08/2011 - 21:42 | 1353300 Re-Discovery
Re-Discovery's picture

Dude, I know its your jobto say everything is OK in America but give it a rest. 

Check growth in GDP ex Govt priced in gold less growth in national debt and you will understand this great engine of commerce is a sputtering wreck that needs daily oil changes (QE) to continue to operate.

Wed, 06/08/2011 - 18:31 | 1352725 hambone
hambone's picture

Here's an easy way to think bout it -

1970 - GDP $1T vs. $380B debt

1980 - GDP $2.7T vs. $909B debt

1990 - GDP $5.7T vs. $3.2T debt

2000 - GDP $9.7T vs. $5.6T debt

2010 - GDP $14.5T vs. $13.5T debt

2011 - GDP $14.9T (@3%) vs. $15.4T debt

2012 - GDP $15.35T (@3%) vs. $17T debt

2013 - GDP $15.8T vs. $18.5T debt

GDP up 15x since '70, debt up 38x...look at the trend, GDP now growing @3% vs. debt growing @9%...given they are same total size, this is the Rheinhart / Rogoff problem...if you slow debt growth, you slow GDP in a deflationary trap...if you don't slow debt growth, you run headlong into an inflationary / hyperinflationary debasement.

Wed, 06/08/2011 - 18:50 | 1352812 Spalding_Smailes
Spalding_Smailes's picture

We are the global reserve currency .... This answers most of your points

How many countries peg to the dollar ? China , Opec, and .....

The countries that peg recycle back into USA assets .....

Dollar denominated debt always a thirst for more dollars. And forex trade, commodities , global banking all run through the USD

Wed, 06/08/2011 - 19:04 | 1352871 hambone
hambone's picture

How's that dollar "peg" working out bout now in MENA?  China?  Vietnam?  Elsewhere?  These countries are experiencing massive inflationary spikes leading to instability, potential revolt, chaos. 

Curious to believe that given our dollar devaluation will only ramp up (given the above) that these countries will continue to play nice and recycle our dollars like good little lap dogs.  Somehow, I'll take the other side of that bet that these folks will find a way to a "stable medium" of exchange rather than the dollar...and far sooner than you will presuppose.  Revolutions have a funny way of reshaping things in short order.

Wed, 06/08/2011 - 22:00 | 1353360 dark pools of soros
dark pools of soros's picture

Spalding is stuck in the 90's..  keeps the Friends re-runs going to keep his mood level

Wed, 06/08/2011 - 21:45 | 1353324 Re-Discovery
Re-Discovery's picture

Spalding, get your foot off the boat!  And get better arguments than something "is" because it "is."

Check the history of "reserve" currencies.  Hint: they all have lost that vaunted status.

Wed, 06/08/2011 - 20:44 | 1353134 WonderDawg
WonderDawg's picture

2011 and 2012 GDP @ 3%? That's wildly optimistic. We had 1.8% in the first quarter, trending down. I'm thinking by the end of the year it will be contracting, even with a raise in the debt ceiling and continued .gov deficit waste, er, spending.

Wed, 06/08/2011 - 18:28 | 1352735 Fiat2Zero
Fiat2Zero's picture

That's because GDP counts government spending. So as you rack up debt, your GDP goes up.

Definitely not bullish...

Wed, 06/08/2011 - 18:42 | 1352794 Spalding_Smailes
Spalding_Smailes's picture

Does GDP count Apple, Google, IBM, Johnson & Johnson, Exxon, Chevron, Ford, HP, GE revenues.... ?

Just checking ....

Wed, 06/08/2011 - 20:01 | 1353002 Biosci
Biosci's picture


Wed, 06/08/2011 - 19:16 | 1352909 azengrcat
azengrcat's picture

Back out the .gov borrowing and inflation... not so spectacular.


Wed, 06/08/2011 - 18:15 | 1352697 kito
kito's picture

you left out the part about the rothschilds actually being the universe [8]

Wed, 06/08/2011 - 17:29 | 1352544 roymunnson
roymunnson's picture

So if Gross is short.....


and there is no QE3....


What would cause treasuries to fall....hmmm....





Wed, 06/08/2011 - 17:39 | 1352565 Rynak
Rynak's picture

A (partial) default?

Wed, 06/08/2011 - 17:44 | 1352606 roymunnson
roymunnson's picture

Just a thought... 


Wed, 06/08/2011 - 17:57 | 1352639 alexdg
alexdg's picture

Probably explains why the Pimco equity fund is heavily invested in Gold, they call it a "just in case" investment.

Wed, 06/08/2011 - 20:49 | 1353140 WonderDawg
WonderDawg's picture

I've been wondering the same thing.

Wed, 06/08/2011 - 18:00 | 1352654 css1971
css1971's picture

Just a little one. Just a sliver of a default.

Wed, 06/08/2011 - 18:14 | 1352693 Rynak
Rynak's picture

Won't that set a bad example for the PIIGS? :-)

Wed, 06/08/2011 - 18:40 | 1352769 GoinFawr
GoinFawr's picture

Just a silver of a default?

Wed, 06/08/2011 - 19:09 | 1352885 cosmictrainwreck
cosmictrainwreck's picture

just a partial one.... a transitory one

Wed, 06/08/2011 - 17:43 | 1352585 Rainman
Rainman's picture ( 1 ) miserably failed bond auction ??

Wed, 06/08/2011 - 17:46 | 1352602 carbonmutant
carbonmutant's picture

A junk rating by Fitch?

Wed, 06/08/2011 - 17:51 | 1352627 Rainman
Rainman's picture

Obeyme goes full tard, cleans house and admits how fukked we really are ??

naw, me will keeps thinkin'.....

Wed, 06/08/2011 - 17:33 | 1352546 NotApplicable
NotApplicable's picture

Once again, Gross spouts conventional wisdom while hedging his words. In this case the hedge is the phrase "after the second round expires at the end of this month," while the wisdom is "'The members of the central bank's open market committee are 'balanced but divided'."

So, now everybody knows the storyline that "the board is grid-locked and thus there can be no immediate remedy." But, that just means (as we all know) that they have to break more crap in order for the board to become more accomodative to the idea of QE3.

To me, the only question is just how long do they let the pain set in before the inevitable turning of the tide, when Gross will suddenly tell us all that the board is ready to act?

Wed, 06/08/2011 - 17:31 | 1352548 swissinv
swissinv's picture

Who is buying 1.2 trillion of US Treasuries?

The Chinese? No fucking way

Europe? Busy with the Trojka

Bill Gross? Short treasuries

Sorry too big to fund - need Bernanke and his helicopter!


Wed, 06/08/2011 - 17:38 | 1352560 Boston
Boston's picture

How about the $trillions that will pour out of stocks, HY and commodities after QE2 ends?


Wed, 06/08/2011 - 17:40 | 1352574 HpDeskjet
HpDeskjet's picture


Wed, 06/08/2011 - 17:49 | 1352611 swissinv
swissinv's picture

I think the money goes somewhere else as long as the FED maintains such ridiculous low interest rates. In a negative real interest environment rational investors will continue to invest in gold. This fact won't change due to the FED's massive PV01.

Wed, 06/08/2011 - 18:10 | 1352679 HpDeskjet
HpDeskjet's picture

Real interest rates are negative due to QE-inspired "investing" in commodities that creates a short term upward shock in inflation. However, as wages dont increase, higher food/oil prices will result deflation in everything else and cause the economy to fall off a cliff => inflation decreases => real rates up => bonds attractive.

Wed, 06/08/2011 - 18:34 | 1352744 swissinv
swissinv's picture

Well I see where you coming from but if you follow the Silver market and COMEX inventory you'll see there is a complete different game going on as well. I highly doubt that you will see a lower Silver or Gold price.

Wed, 06/08/2011 - 20:53 | 1353151 WonderDawg
WonderDawg's picture

I'm damn sure not betting that way. I see silver below $20 before any kind of significant bounce back to near the highs.

Wed, 06/08/2011 - 18:28 | 1352726 Infinite QE
Infinite QE's picture

So DOW 200 here we come? LOL. Hopey's got an re-election campaign coming and any massive dip in the DOW will set alarm bells a ringing. The fact is that there is no buyer for the longer term treasuries. Sure the short end gets some attention when stocks go down but they'll be out of them ASAP when a better play comes down the pipe. 


QE to Infinity is the only game in town. 

Wed, 06/08/2011 - 17:36 | 1352570 HpDeskjet
HpDeskjet's picture

Who is buying 1.2 trillion of US Treasuries?


The "investors" that bought stocks/commodities in anticipation of infinite QE....

Wed, 06/08/2011 - 17:42 | 1352590 augie
augie's picture


Wed, 06/08/2011 - 18:51 | 1352835 topcallingtroll
topcallingtroll's picture

china will buy all the treasurys we care to sell them.

They complain a lot, but they are addicted.

Wed, 06/08/2011 - 17:33 | 1352557 Scipionz
Scipionz's picture

Anyone ever saw the documentary :

Bill Still's Wizard of Oz Documentary

Its a matter of who control the money supply... and who pay interest to who.

For sure all ZH's know that. In current form of doing the thing, there's no way out of the ponzi scheme whitout printing more bc there is not enough money on the table to pay the interest attach to it. So the game will end in full debt world so that banker apply ONE to rules them all, or revolution. This is no issue about Q#.... but about the way the bank system is done. They have the controlover money supply, not the gouv, not the people. So they will put us in debt to establish total dictature/empire as they ever tried since.... since we know man kind. 

Wed, 06/08/2011 - 18:01 | 1352649 css1971
css1971's picture

Yup. I think most here know how it works. But ZH is ~0.000001% of the population.


Wed, 06/08/2011 - 17:42 | 1352580 AGuy
AGuy's picture

Bill Gross is an idiot if he thinks QE3 isn't going to happen.

As I recall, Benanke, Hank Paulson and friends promised that there would be no bailout for Lehman or any finance firms. 12 hours later, Benanke starting backstopping everything, and Hank Paulson pushed TARP.

QE3 will begin the moment the first signals of pending crisis is coming. I bet QE2 will begin as soon as 10 Yr rises by 100 bps, which will probably happen in a matter of hours if not minutes when the market hits crisis mode. Although I haven't got a clue when crisis mode will begin. Perhaps, if Congress fails to raise the Debt ceiling by the Aug 2nd Deadline.



Wed, 06/08/2011 - 17:45 | 1352612 camaro68ss
camaro68ss's picture


Wed, 06/08/2011 - 20:26 | 1353075 I dont belong here
I dont belong here's picture

What happens July 5th?

Wed, 06/08/2011 - 17:59 | 1352636 swissinv
swissinv's picture

Bill Gross is certainly not an idiot - like all others he has to play the game... The heroin getting more difficult to smuggle and it will take some time to come to the consumer...

Wed, 06/08/2011 - 18:22 | 1352717 4shzl
4shzl's picture

I haven't got a clue

At least we can agree on this.

Wed, 06/08/2011 - 18:29 | 1352730 Infinite QE
Infinite QE's picture

A month from now it will be revealed that QE 3.0 has already started.

Wed, 06/08/2011 - 17:42 | 1352581 alexdg
alexdg's picture

What is Gross take on the debt ceiling? Is QE3 totally independent of the fact that Government raises the ceiling with or without and future budget cuts?

Bernanke warned Congress that fiscal stimulus shouldn't retreat as it would harm the recovery. Wouldn't an increasing debt ceiling of 2.4T's and high deficits alone be negative for the USD, even without QE?

Wed, 06/08/2011 - 17:42 | 1352582 grunk
grunk's picture

No Viagra3?


Wed, 06/08/2011 - 17:43 | 1352587 I think I need ...
I think I need to buy a gun's picture

gold revaluation

Wed, 06/08/2011 - 17:44 | 1352593 TheGoodDoctor
TheGoodDoctor's picture

So, how much cash does PIMPCO have? Is it enough for them alone to be QEIII?

Wed, 06/08/2011 - 17:56 | 1352632 alexdg
alexdg's picture

That's precisely what Pimco is trying to avoid. But if they didn't have anywhere else to invest but treasuries, then no QE3 would be needed; aka what Gross calls "Financial Repression".

Wed, 06/08/2011 - 18:05 | 1352660 TheGoodDoctor
TheGoodDoctor's picture

Yeah but if they are sitting on a bunch of cash and bonds go down and rates rise because of a lack of QEIII and then the pain that is caused creates QEIII then won't those bonds be worth more that PIMPCO just bought? Isn't that the game here?

Wed, 06/08/2011 - 18:06 | 1352664 swissinv
swissinv's picture

Pimco's AuM are around one trillion as far as I know... Thus a PQE would theoretically last a little bit more than year-end. But I doubt that Gross would assume such a big FX exposure... He would rather diversify by buying high quality corporate bonds across the globe. 

Wed, 06/08/2011 - 17:42 | 1352598 bob_dabolina
bob_dabolina's picture

Fuck welfare AND the debt ceiling.

UPDATE: The story has verified. It is true. Someone bought lobster and Porterhouse steaks with food stamps.

Wed, 06/08/2011 - 17:54 | 1352642 css1971
css1971's picture

What's wrong with that? Food stamps are money too.

Wed, 06/08/2011 - 18:50 | 1352830 topcallingtroll
topcallingtroll's picture

yeah the sooner we end big government and transfer payments the sooner these losers will either die or get a job.

Wed, 06/08/2011 - 17:53 | 1352608 bob_dabolina
bob_dabolina's picture

I also heard about another scam today regarding food stamps. 

Drug users (whom don't need feed stamps) are getting food stamp cards and selling them for 200-300 bucks so they can get high. Yea the food stamp money is worth thousands of dollars but they hock it for a couple hundred bucks so they can buy some coke or weed, and the person they sell it to gets a bunch of free food. 

More on the selling of foodstamps

And they want to raise the debt ceiling? FUCK NO

Wed, 06/08/2011 - 18:06 | 1352663 Irwin Fletcher
Irwin Fletcher's picture

From what I understand, the typical food stamp ration will buy more food than needed. Indeed, people involved in the drug trade use them to buy food and barter for cash. In south Chicago, the going rate in grocery store parking lots is about 50 cents on the dollar. The drug dealers who prefer to eat at restaurants generally trade all their stamps for cash.

Wed, 06/08/2011 - 20:03 | 1353007 Biosci
Biosci's picture

Interesting.  That exchange rate hasn't moved in 20 years.

Wed, 06/08/2011 - 23:54 | 1353614 Dr Zaius
Dr Zaius's picture

Sad that food stamps are more stable than the dollar.  Perhaps GS has a hedge fund on them.

Wed, 06/08/2011 - 18:51 | 1352820 GoinFawr
GoinFawr's picture

Persnickety, I know, but,

" ...and the person they sell it to gets a bunch of free(sic) food."

Sounds like a free market exchange to me; abusive and illegal no doubt, but pretty petty all in all. Probably count the losses to the state in the hundreds of thousands on that one.


"Look Up. Look waaaaaay Up."

Wed, 06/08/2011 - 18:53 | 1352825 topcallingtroll
topcallingtroll's picture

Losses to the state?

These are losses to hard working taxpayers.  The state doesn't have its own money.  It takes it from the people.

Fri, 06/10/2011 - 00:35 | 1352861 GoinFawr
GoinFawr's picture

Right. Petty losses to get incensed about considering the example being set by the plutocrats. Those people exchanging their foodstamps for drugs are likely barely surviving day-to-day anyway. IE it's still hitting its target demographic,  which makes it paper better spent than giving it to the already wealthy, regardless of the fact it's only a small tithe of the amount. But thanks for the lesson on your special subject, the Bleeding Obvious.

"This is particularly the attitude of intelligent, cultivated people; one can read the substance of it in a hundred essays. Very few cultivated people have less than (say) four hundred pounds a year, and naturally they side with the rich, because they imagine that any liberty conceded to the poor is a threat to their own liberty. Foreseeing some dismal Marxian Utopia as the alternative, the educated man prefers to keep things as they are. Possibly he does not like his fellow-rich very much, but he supposes that even the vulgarest of them are less inimical to his pleasures, more his kind of people, than the poor, and that he had better stand by them. It is this fear of a supposedly dangerous mob that makes nearly all intelligent people conservative in their opinions." -Eric Blair


Look, just so we have things nice and sparkling clear here I am not condoning illegal foodstamp trading in comic book stores any more than you are condoning bank bailouts (you aren't are you?). All I am arguing is that the plugged nickel each taxpayer coughs up every year to fund the former is effing insignificant when compared to the thousands/man, woman and child being pumped into the latter (not to mention the mother of all welfare queens, the MIC). 

Starting with the plugged nickel crowd won't get you very far balancing the books, and will leave ever more armed impoverished people in an even worse position than they obviously already are...

just sayin', try not to be so universally stupid.

Wed, 06/08/2011 - 19:58 | 1352945 Rynak
Rynak's picture

Strangely, whenever you mention "hard working", it seems the conditions you are mentioning mostly apply to employers and rich people, neither employees nor unemployed. I.e., you consider everyone below your class, to be a lazy slacker that needs a good beating to improve morale.

It's not restricted to the above post, but systematic in your comments.

To put it simple: You're a slavedriver, and you like to kick employees as well as unemployed.

Heck, in an earlier post of you, you even suggest to "let people die or find a job"... completely ignoring, that there are not enough jobs, to sustain everyone's living costs, at current wage-levels. You also ignore - even though i explained it to you before - that measures as those which you propose, send wages even lower (what else do you expect, when during an interview, the employer basically has a loaded gun in his hand, when discussing the employment contract?). So, following this train of thought, what you propose is this:

1. Let about 10% of the population die right now (about 30 million).

2. Another 10% will get employed, below current wages, because employers can now set whatever wages they want.

3. Employers will fire past employee's or renegotiate contracts, to get them down to the new lower wages

4. Now, even more demand for jobs exists, because the reduced wages mean that people need to work more hours to pay their living costs - the supply of work hours however did not increase.

5. More people die.

6. Some find a job.... again, at further reduced wages.

7. goto 3.

What this ultimately will result in, is that each employee will work the maximum possible hours he can, without collapsing unconscious from exhaustion... and they will at this load ultimately be paid the minimum necessary to barely survive.

After all available workhours are distributed on people, according the above conditions, the rest of the population dies. So in principle, you encourage to kill millions of people, until the population is decimated to be just enough to at max capacity match the available jobs. Meanwhile, the buying power of consumers, will have gone so far down, that none of the workers can afford anymore what they are producing.

Or in short: You want to turn the USA into something worse than slavery, and kill off all the "unnecessary" people.

Luckily, even if you egomaniac had the power to implement such a policy, you would soon afterwards by lynched by the population.

P.S.: People with a mindset as yours are the reason why i'm a freelancer. I do not want to be employed in a market, that is going into the direction which you propose. I refuse to be a slave, and refuse to treat others as slaves. This my dear, is why i'm out of the system, while you are still part of it, playing the role in the class-warfare sadomaso-game, that you are supposed to play.

Wed, 06/08/2011 - 20:28 | 1353080 ColonelCooper
ColonelCooper's picture

Change #1 to around 25-30%, and you're onto something.  Only make it global.  And hurry up about it, please?

Wed, 06/08/2011 - 21:10 | 1353217 blunderdog
blunderdog's picture

Save your breath, Rynak, TCT's time won't be up until the medical infrastructure collapses.  The fact is, there isn't sufficient demand among the elites for his line of work.  Once the poor and the elderly are no longer getting subsidized health-care, he'll be introduced to a truly competitive market, and we'll get to find out exactly what kind of hourly wage psych-services are worth.

Maybe his investment income will sustain him at that point.  Heh.

Wed, 06/08/2011 - 22:09 | 1353358 Rynak
Rynak's picture

we'll get to find out exactly what kind of hourly wage psych-services are worth.

Okay, i'll drop the bomb:

He will find out, that the wage he is worth, is his current income, minus privileges, minus most of the taxes he is paying.... but he will refuse to acknowledge it, because doing so would mean to acknowledge, that he actually isn't paying for anyone else - instead, he is just earning too much, and is then made to redistribute the bloat to the losers of the employment-casino, via taxes and stealth-taxes (aka inflation): Artificial class-warfare.

Wed, 06/08/2011 - 22:11 | 1353389 blunderdog
blunderdog's picture

You know, it's like...not government malinvestment when it's my paycheck.  For sure.

As a computer techie asshole, I sure did enjoy the '90s.  Most of us didn't manage to break into the aristocracy then, either.

Me and my colleagues occasionally like to amuse ourselves with the statistics these days.

"Dude!  You know what a PROJECT MANAGER makes?!?!"

Hee hee.

Wed, 06/08/2011 - 23:00 | 1353479 Rynak
Rynak's picture

Actually, in the 90's, computer techies were at least paid for above average performance. Nowadays, with the massive influx of script kiddies to do bogstandard work, it's just race to the bottom, unless the skills you provide, are exotic and rare (disclaimer: Cross-architecture assembly programmer, and VM designer here. Though, i still like to provide highlevel skills to people, who value simple, unbloated and handtailored services. But the demand in this sadly is low by now, so i now make most of my revenue from more exotic skills).

Slightly off-topic: Is it just me, or has software reached it's peak around Y2k? It seems to me, all software had the optimal balance in usability, efficiency and maintainability back then. I.e. if it weren't for hardware support, i'd still be running windows 2000 (not that abomination that was winME).

Wed, 06/08/2011 - 23:45 | 1353589 blunderdog
blunderdog's picture


Kids on dumb-dust who could set up printers stood a good chance of $40K/year jobs doing shit-work in any big corporate environment.  By and large, "performance" was determined by whether you could perform the work and showed up.  Programmers had to know a bit more than the infrastructure guys, but churning out PeopleSoft and/or SAP automation could EASILY bring in $80K, despite the fact that a smart high-school kid who understood the principles of chess and could read documentation would've done the same (or better) work.  How old are you?

The market's been commoditized.  You (and your competitors) can earn most of your income based on your sales skills. 

As to when software reached its peak: Win2K was the best Microsoft OS, and I think there was a bit of carryover because of that--there were still significant disk-space and RAM limitations to deal with, and it was relatively easy to distinguish good from bad software.  But it was a coincident kind of thing.  The crash of the late '90s tech-boom and the global effect of Chinese MFT status and "free-trade" displaced most experienced (high-wage) coders and replaced them with cheap emerging-economy guys. 

If it cost one-tenth as much and worked half as well, it was a "productivity" gain of 500%.

Thu, 06/09/2011 - 00:45 | 1353643 Rynak
Rynak's picture

I stand corrected - looks like i was just looking at employment chances in a too "honest" fashion. Still, in the 90's i had plenty of opportunities, to get good compensation, for above average highlevel work. Now, it seems almost everyone just wants bogstandard stuff, that can easily be rendered profitable by copy-n-paste.

So, i stand corrected on the ways to get cheap profit in the 90's. However, i continue to claim, that back then one could earn a good living, by offering honest, efficient and handtailored highlevel work - while nowadays, the majority just wants to pay as little as possible, for as low quality as possible.... ESPECIALLY, when it comes to webapps.

P.S.: Location may make a difference. I'm takling from an european POV here. I.e. one thing that was different back then, regarding where i live, is that there was no euro (the euro instantly inflated currency and wages, by at least 40% over here)

Thu, 06/09/2011 - 00:50 | 1353699 blunderdog
blunderdog's picture

I was in the USA.  Maybe Europe was more of a meritocracy at the time.

Thu, 06/09/2011 - 01:06 | 1353741 Rynak
Rynak's picture

Maybe. After all, the pattern of "us trailing the USA" regarding evolution, is not restricted to europe. It happened and still is happening in other continents as well.

Kinda ironic, that back then, "we" were looking at the USA as an example, regarding where to move fowards to.

Makes me kinda curious.... and a tiny bit hopeful.... regarding where things are moving now. After all, if there ever were significant movements away from the USA-blueprint, they are happening right now.

Wed, 06/08/2011 - 17:47 | 1352620 kito
kito's picture

EVERYONE, i repeat, EVERYONE, will continue to buy u.s. debt for the foreseeable future!! why is that such a hard concept to understand. 

Wed, 06/08/2011 - 17:52 | 1352633 css1971
css1971's picture

How do you get your teeth so white?

Wed, 06/08/2011 - 18:31 | 1352747 kito
kito's picture

oh css, you flatter me [blush]!

Thu, 06/09/2011 - 00:56 | 1353713 abalone
abalone's picture

Those chompers have got nothing on Cyan the way anyone seen him of late. He made some really good calls early on in the rally

Wed, 06/08/2011 - 17:56 | 1352634 Spalding_Smailes
Spalding_Smailes's picture

And they are buying longer term debt via U.K. & Canada .... on the down low ....

Wed, 06/08/2011 - 18:07 | 1352661 Rynak
Rynak's picture

Well, it's totally easy to understand, once one disregards that it isn't happening now already. That's something which a lot of people fail to understand.... once one rejects reality, a lot of things make total sense. I.e., this is also why people fail to understand, that the economy is really recovering.

Wed, 06/08/2011 - 18:11 | 1352684 kito
kito's picture

this one goes out to all the zh pundits waiting in the station for that qe train to roll by any minute now...

So, bye, bye, Miss American Pie.
Drove my Chevy to the levee, but the levee was dry.
An' them good ol' boys were drinkin' whiskey and rye.
Singin' "This'll be the day that I die.
This'll be the day that I die.

Wed, 06/08/2011 - 17:59 | 1352644 SunBlaster
SunBlaster's picture

Gross is not a fool, the guy does one thing but talks about something else, cmon people it's clear as water what hes doing.

Wed, 06/08/2011 - 17:55 | 1352645 JR
JR's picture

Retired Professor of Finance Michael S. Rozeff commented today on the LRC Blog that, in his opinion, the Fed will continue its easy money policy. Writes Rozeff :

“I've just read Bernanke's latest speech. It's long and boring. Historically, the Fed fails to recognize that inflation in the world money supply causes prices to rise, and it fails to recognize that its own actions influence growth in the world money supply by influencing other central banks and through exchange rates. The Fed simply pursues a nationalistic monetary policy and ignores the rest of the world. It really doesn't care if the dollar is rising or falling, and it's blind to all currencies falling against gold. Bernanke retains all of this limited vision. Consequently he rationalizes sharply rising commodity prices by invoking high demand overseas (as if it were exogenous and uncaused by anything the Fed has done) and various supply disturbances like droughts or excessive rainfalls, which are almost always present somewhere on earth and almost invariably are invoked to justify price movements in commodities. I never believe these facile explanations.

The bottom line is that the Fed will continue its low interest rate policy even though QE2 is coming to an end. There is no QE3 ready in the wings, but that means little. These QE programs were widely heralded large-scale interventions that propelled the Fed's balance sheet higher. I expect that the Fed will, for a time, revert to form, which is to continue expanding its balance sheet, but at a less steady rate and a lower rate, and without announcing that the major trend will be up. It will continue monetary expansion. That's my belief. Bernanke didn't say this explicitly, but he said as much because he said that policy would continue accommodative and with zero interest rates until further recovery was evident in the economy. There's little reason to expect robust recovery, what with the incentive to save and invest being so poor.” (my emphasis)

Wed, 06/08/2011 - 18:02 | 1352651 Pinefox
Pinefox's picture

A QE3 would scream that the US economy has hit the iceberg and is sinking like the Titanic.  Even retail investors would see the inevitable and pull out of the market completely.  World confidence should sink just as fast. 

Wed, 06/08/2011 - 18:10 | 1352667 Thomas Paine
Thomas Paine's picture

IMHO, it's possible fiat reserves are now sufficiently placed with the PDs and their corptocracy to buy the dip in rapidly deflating global assets and consolidate smaller banks, for pennies on the dollar...a stronger dollar is more bang for the buck.

- tom

Wed, 06/08/2011 - 18:10 | 1352680 Ying-Yang
Ying-Yang's picture

"the Fed will try to keep interest rates low with its official statements"

Believe me honey..... I pulled out.

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