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Did The Fed Just Give The Green Light To Sell The Stock Market?
Remember when the president uttered the magic words back in March 2009, when he said that "profit and earning ratios [whatever the hell those are] are starting to get to the point where buying stocks is a potentially good deal if you’ve got a long-term perspective on it" giving the green light for the 2 year bear market rally? Well, if that was global market Risk On, Janet Yellen just gave the Risk Off command. To wit: "forward price-to-earnings ratios in the stock market fall within the ranges prevailing in recent decades, and are well below the early-2000 peak, although corresponding measures for small-cap equities (not shown) appear somewhat elevated....special questions included in the March 2011 SCOOS suggest an increase
in the use of leverage by some traditionally unlevered investors (such
as pension funds and insurance companies) as well as hedge funds during
the previous six months.
" Yup: small caps, aka the Russell 2000, aka the Economy according to the Fed's third mandate. Ironically, the Fed realizes the Catch 22 it is caught in, which we noted earlier, namely that stocks are pricing in QE 3, but for QE 3 to happen stocks have to drop 20% from here. Well, this may be the last warning from the Fed.
h/t London Dude Trader
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"Should broader concerns emerge, I believe that supervisory and regulatory tools, including new macroprudential approaches, rather than monetary policy, should serve as the first line of defense."
WHAT is "macroprudential"?
A ten-dollar word for management of the entire credit cycle. (Because central banks have done so well "managing" interest rates).
How about a deflationary event, putting further pressure on the PIIGS to post collateral and sell assets at huge discount to current prices ultimately benefiting the usual suspects.
Is Alvarez outright lying?
33 Liberty st.
A public competition for design of the building was held and the architectural firm of York and Sawyer submitted the winning design. The bank moved to its current location in 1924.[6] The Federal Reserve Bank of New York maintains a vault that lies 80 feet below street level and 50 feet below sea level,[7] resting on Manhattan bedrock. By 1927, the vault contained ten percent of the world's official gold reserves.[6] Currently, it is reputedly the largest gold repository in the world (though this cannot be confirmed as Swiss banks do not report their gold stocks) and holds approximately 7,000 metric tons of gold bullion ($335 billion as of April 2011), more than Fort Knox. The gold is owned by many foreign nations, central banks and international organizations. The Federal Reserve Bank does not own the gold but serves as guardian of the precious metal, which it protects at no charge as a gesture of goodwill to other nations.[citation needed]
umm, no. being a custodian is not owning.
btw, you have posted the greatest line ever, i always use it. The Federal Reserve Bank does not own the gold but serves as guardian of the precious metal, which it protects at no charge as a gesture of goodwill to other nations.
LOL!!! good will!
According to the latest info I have read.
The 8100 Tons of US gold. is held in FOUR locations.
The Fed's Bank in NYC, Ft Knox, West Point, and one other institution that escapes me now.
The Fed's Depository Bank, is used to store mostly other countries stock.(rumor is they have stolen that too).
As far as the US Gold reserves being supposedly the largest, it makes NO difference.
At current mkt rates, it would not pay one months expenses of this gov't.(if we were to sell, approx 380 Billion) if at mkt value.
Problem is the USG has the official price set at $42.xx+/- per ounce.
Now, that is what I call STUPID.( as if it matters).
Any Dow 10,000 3.0 hats for sale?
Do they show the 2nd derivative too?
The Fed has been so successful in promoting the free RUT put option now they find themselves having to talk down the risk assets. But the crowd has become Pavlovian dogs traned on buying any dips, talking won't get them to puke and sell. Certainly gold and forex aren't biting - the UUP toilet paper index has been stuck dead below the 50dma since start of the year even a european/greek porn comedy cannot give it a short erection. It will have to be a catastrophic GDP contraction, or a -200k print in NFP number for the JBTFD to be purged. If any start-up can make a a memory zerorize button that works on the pavlovian dogs, the fed would pay handsome money for it now.
Everyone assumes that the Fed is driven by their so-called dual mandate (full emplyment/low inflation). But, since the Fed is a private corporation it works in the best interests of its SHAREHOLDERS. These shareholders are NOT the citizens of the United States. Its utilization of the QE mechanism is evidence of a much deeper agenda that does not coincide with the interests of the American citizen.
The owners of the Fed are interested in power and control. Arguably the corporate oligarghs own over 90% of the world's wealth so the moves being made are not about additional profit. When you own/control 90% of that welath it is a diminishing return game. The real end game is control over the populance of all the sovereign nations of the earth. You can see this unfolding in Europe as they follow the IMF playbook: more debt and taxation for the common man and fewer services in return (austerity) with a nice dose of privitization (confiscation) of the national assets. This creates perpetual serfdom and it is coming here, soon.
The plan, as I see it, is let the economy wallow for 6 months or so and inject more liquidity into the system. This gives political cover for QE3 (or whatever it is called). This is intended to bring Russia and China untimately under control. The US economy (and the American Dream) need to be extinguished and this will be done via the dollar destruction. Hungry, desperate and scared people are always willing to trade something (i.e. rights, sovereignty) for security or a full stomach. This may happen next year (in which case Obama will be a one-term sacrifical lamb) or in 2013 after the election. It will pay to have non-dollar demoninated assets as well as as assets outside of the US if you have the means.
No, the level of control and influence wielded by the elites will wane in the future. The New World Order will be disorder and fragmentation. Price discovery will be local, as will resources. Once the currency dies, the power dies.
Not if they already own most of the gold.
Here's the deal. Energy boom lowers our cost which would make higher interest rates tolerable- if they'r a dollar for dollar offset. Higher interest rates would help our savings dividents big time (helps business). Which city led the national commercial real estate marets 1976-1979? DENVER- hello!
If you walked down 17th street then it was like the downtown financial district of New York. If you had a degree in geology you were set. If you had a degree from the Colorado School of Mines, you were golden. We had the CA Gold rush, we had the OK sooner 1889 land run. How else is a 6% ^TNX going to swallowed.
Well I just got 999'd from Yahoo. I know here I won't get nixed. What is it with this world though hey? People can say all sorts of nasty stuff but if you take the time to write out a thoughful comment.. NO Yahoo Police say. All I brought up is that there is a (small) faction who are creating some real problems for real people.
I think you hit it. They are not going to let anything deflate. Watch for a news story about how easy money will be the right way for a few more months. I can almost smell the copywriters typing up the article.
But first you have to feel a bit of pain in your 401k.. Then when they say print, you will be all please go for it. I am losing my shirt here.
What was wrong in that? Honest..May not be right, but it is an opinion. And not rude to boot.
Agree.
As I and many others comented way back in QE1, this engineered happy talk and CNBS BS simply cannot last forever.
Too many people have lost their jobs, too many are worried about losing theirs, and all the figuers have been getting worse regardless of the reckless stimulus, money printing and orgainized theft.
At this point even the QE3 would be electorial suicide given growing concern over public debt and the lack of legal change in wall st.
This party was over before it began, but most people and MSM just didn't want to admit it.
Remember when people laughed when we said Greece would default? Eveneryone laughed despite the mathematics, now everyone is talking about 'NOT IF BUT WHEN!'
The same applies for this, as we knew it would.
Prepare accordingly.
In the mean time, get out your fiddle and watch rome burn.....should be quite a show.
yellin is a c---t. I wish she's shut the fuck up. keynesian. where do all these idiots come from.
Hell. They come from Hell.
Maybe make a list of people who say QE3 is not likely and then look were they left their brain or their money they got to spread these nonsense in "Operation FED Mockingbird".
OK, lookey here. QEwhatever is about bonds and rates. The QEs have been about keeping the Government credit card fully charged up for spending. QE3 has already started. Moving money out of stocks and into bonds is the goal. They can't name that tactic as an actual Quantitative Easing so there will officially not be one. Even though there is one.
Isn't there already enough 'printed' USD outside the country ready to be dumped if 'people' lose confidence in the USD? Could not one or more entity in dumping USD create a self reinforcing dumping and an accelerating devaluation of the USD that feeds on itself.
Would US producers rather then sell all their product overseas for more USD or alternatives than they would get on the domestic market, would their prices on the domestic market rise to that they could achieve on the international market? Would those prices increase at an accelerating rate in tune with the accelerating devaluation of the USD.
It's already happening. Japan and China have stopped buying and started selling. Possibly others as well. They aren't going to dump all at once, they don't want to wreck the market for themselves. But if the Fed was not buying the S would have hit the F a year ago.
Average cross-asset correlation at third highest level since 1990. Only exceeded
by period prior to collapse of LTCM and just prior to QE2.
http://ftalphaville.ft.com/blog/2011/06/01/581676/the-calm-before-the-vo...
Hugh Hendry's planet Hendry:
http://av.r.ftdata.co.uk/files/2011/06/Planet_Hendry.png
I believe the "we are here arrow" just moved a little further to US and Germany slow.
I completely agree with your views. If QE3 was to happen, more people will come around to this scam. They don't want that actually. Cash payday loans
what is working with qe..banks saved from BK, stocks rebound, commodities rise..pensions and insurers kept solvent..that's why Leo loves it and solar's of course
what is not working : employment, did I say employment? and quality of life..massive debt.
next up: ?? solve massive debt..what if the FED is broken up and the debt on its balance sheet is nullified?
who wins and who looses with above?
Tyler is this too dumb to be a possibility?
to justify QE3, they'll take the market down to the 200 MA, shake the line and spook the traders by penetrating it for a bit of time, and then, and only then, will the banksters then get the cue that QE3 will indeed occur.
That's the way the game is played.