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Guest Post: Investors Are Doing The Fed's Bidding

Tyler Durden's picture




 

Submitted by Abigail Doolittle of Peak Theories Research

Investors Are Doing The Fed's Bidding

 

 

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Fri, 09/24/2010 - 12:54 | 602800 Jack
Jack's picture

I wonder if it's a fair comparison to make:

Americans who will buy stocks dogmatically, compared with Japan's savings culture.

 

Both in a sense give the government an unbelievably long leash to run debt up.

Fri, 09/24/2010 - 12:56 | 602803 Village Idiot
Village Idiot's picture

"...and Ben doesn’t even look like the bad guy..."

 

I thought you wrote "doesn't even look like the bald guy."  That would have been a feet. 

 

No disrespect to bald guys, btw.  I have a hair peninsula.

Fri, 09/24/2010 - 12:57 | 602812 frankTHE COIN
frankTHE COIN's picture

Moral suasion and manipulation always comes to a climax.

Fri, 09/24/2010 - 12:58 | 602815 Turd Ferguson
Turd Ferguson's picture

TD gave you all you needed to know on this subject back on 12/26/09. See below:

http://stockrankings.istockanalyst.com/article/viewarticle/articleid/373...

Fri, 09/24/2010 - 13:00 | 602819 williambanzai7
williambanzai7's picture

More like shAring the same bong.

Fri, 09/24/2010 - 13:07 | 602829 The Franchise
The Franchise's picture

"stimulate economic growth", ummm, to produce what?

Fri, 09/24/2010 - 13:13 | 602838 A Man without Q...
A Man without Qualities's picture

Yes, it's funny how it works.  QE creates fake demand for US Treasuries which the Fed has promised to do everything in it's power to be a loss making investment if held to maturity.  The promise of QE creates the expectation of fake demand, which gets people to buy as it means the greater fool will be coming along soon...  

Fri, 09/24/2010 - 13:15 | 602842 Hondo
Hondo's picture

Stupid is stupid does.

Fri, 09/24/2010 - 13:22 | 602852 Village Idiot
Village Idiot's picture

Life is like a box of, turds.  Not the "Ferg"

Fri, 09/24/2010 - 13:16 | 602848 Traianus Augustus
Traianus Augustus's picture

Bennie boy shooting up the markets with that crack... um... liquidity once again.  What a great guy!  I guess that is what the junkies think about their dealers right after they take their drugs too!!! 

Fri, 09/24/2010 - 21:51 | 603889 StychoKiller
StychoKiller's picture

Debtrol   - the red and blue pill.  Ask for it by name!

Fri, 09/24/2010 - 13:23 | 602865 Hondo
Hondo's picture

After reading more closely it is clear abigail hasn't a clue of what is and isn't "wealth creation".  Her difinition is completely inaccurate.........not very good research on a key point.

Fri, 09/24/2010 - 13:26 | 602873 MuadDib
MuadDib's picture

What is the USD's purchasing power (i.e., it's real value) based on, i.e., what factors?

There is no absolute answer to that question, IMO, and it is leaving the markets extremely confused.  As a result, the end-game is, IMO, hyperinflation -- a loss of faith in the currency.

Even if you subscribe to the deflationist story, should the purchasing power of the USD go up merely because supply is diminished? 

Fri, 09/24/2010 - 13:26 | 602878 firstdivision
firstdivision's picture

So what is causing all this gapping in the 1 min chart (both up and down) of the market? 

Fri, 09/24/2010 - 13:29 | 602884 Chemba
Chemba's picture

if we rally to 1250, say through mid/late Oct, does that impair likelihood that Socialists lose control of Congress?

Fri, 09/24/2010 - 14:43 | 603030 Ned Zeppelin
Ned Zeppelin's picture

If by that you really as asking whether the Demoncrats have a better chance of retaining control vs the Rethuglicans if the equities market continues its vertical ascent, the answer is no - the voters by and large are not benefitting from this circus act, and will remain largely unemployed, and perturbed, until further notice, a fact which is completely irrelevant to all but a handful of politicians in challenged seats.

Fri, 09/24/2010 - 13:31 | 602890 Tic tock
Tic tock's picture

The next week sees a short squeeze, that's for profit -taking, the issue is, that investor onfidence never returned to this market - somewhere between 8000 and 9000 on the Dow ws comfortable- but not enough for the Fed, and since then it's been out control.

There's a disconnect between investor signals and monetary stability which the Fed has got singularly wrong. The few buyers in the equity market HAVE to keep buying up because the alternative is Armeggedon, for the buyers... the Fed made its bed in that regard some while ago and so it's in for the ride. I don't think anyone is under any illusions that the dollar is as good as worthless - the much-vaunted economic strenght of the US GNP has effectively ground to a halt already and with a indiscernable value in the dollar, that isn't about to change anytime soon. There is only one way out of this- the Fed is going to be finished, at least the primacy of the New York branch.

On the basis that banks cease to be powerful when the economy is is in rapid decline, the reserve is dwindling in value and they are schock full of numbers that marked-tomyth, for God's sake. There is only one obstacle remaining, the judicial processes - at this stage though, they rely on enforcement..dream on. ...this is it, the duel between Hamlet and whoever that cousin of his was called... 

the article makes reference to imports/exports, ..with a falling dollar.. either America cobbles together a five-year plan, or the anglo-saxon civilzation is over.

Fri, 09/24/2010 - 13:34 | 602897 Zexe
Zexe's picture

Dont fight the fed. Play along and you will make money. It has just struck me....cud the flash crash have been just like the 1987 crash, with nothing more to it than computers going bananas? If so, we shud go to new highs. I think it is stupid to bet against the fed, the moment they crumble the whole world will.

Fri, 09/24/2010 - 13:45 | 602920 merehuman
merehuman's picture

Zexe, you will be an accessory to a crime in progress .

Fri, 09/24/2010 - 22:33 | 603935 Village Idiot
Village Idiot's picture

.

Fri, 09/24/2010 - 14:06 | 602952 djrichard
djrichard's picture

And really the message at the end of the day from Ben is that we're all each of us TBTF.  Glad to know he has our backs.

Fri, 09/24/2010 - 15:40 | 603216 Lux Fiat
Lux Fiat's picture

"Mr. Bernanke has convinced investors he's holding a royal flush".

Yes, that royal flushing sound is our currency going down the toilet.  Benbo has lopped 10% off of the DXY since the early June peak.  I was only able to offset with a 10% gain in one account.  Thanks for eroding my hard earned savings' purchasing power, MF.

Fri, 09/24/2010 - 18:30 | 603625 pyite
pyite's picture

Please stop with the !#$#%&^$% scribd links.  If the post isn't Lynx-compatible, it's crap!

KTHX

 

Fri, 09/24/2010 - 19:42 | 603739 tom
tom's picture

"Mr. Bernanke has convinced investors he's holding a royal flush"

More like Bernanke has convinced investors he's holding five aces. Inflation is the one thing he could achieve.

http://keynesianfailure.wordpress.com/2010/09/24/why-this-time-qe-really-will-spur-inflation/

Sat, 09/25/2010 - 22:44 | 604954 CL1
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