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Jim Grant: "The Fed Is Now In The Business Of Manipulating The Stock Market...Should Confess It Has Sinned Grievously"
Jim Grant, who will never be accused of being a fan of the Criminal Reserve, and whose views on what will happen to asset prices in a printer-happy world are gradually being validated, appeared on Bloomberg TV, telling Margaret Brennan upfront that Bernanke owes the world an apology. Alas, after various revolutions around the world have been catalyzed by Bernanke's policies, we have a feeling that ever more oppressed people will soon see the Printer in Chief as a patron saint of violent revolution, alas against crony regimes fully supported by the US (and hopefully the US will view it the same way when its time comes). That aside, Grant's criticism of the Fed should really start to grate on the Chaircreature: "I think what would be very good for the Fed if there would be a confession, the Fed should confess that it has sinned grievously, and is in violation of every single precept of its founders and every single convention of classical central banking. Quantitative Easing is a symptom of the difficulties that the Fed has created for itself. The Fed is running a balance sheet which if it were the balance sheet attached to a bank in the private sector would probably move the FDIC to shut it down. The New York Branch of the Fed is leveraged more than 80 to 1. Meaning, that a loss of asset value of less than 1.5% would send it into receivership if it were a different kind of institution...The Fed is now in the business of manipulating the stock market." Jim also has some very critical discussions on how the Fed never settles up on the $3.4 trillion in custodial debt on its books. As always, we can't get enough as more and more mainstream figures turn to bashing that biggest abortion of modern capital markets.
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End the Fed!
66(.6)% of the respondants view Bernanke favorably?
there, fixed it
i loved that intro. they must have spent days locating all of ben's relatives.....
bloomberg is now officially CNBC with a bigger vocabulary and more professional looking charts.
...and Margaret. Don't forget Margaret.
forgot to mention it was a poll of PDers
The poll was for "investors" not just "respondents" so...of course the people sucking off the Fed love The Bernank.
End the Fed, they're doing it all by themselves... the NY Fed is leveraged 80/1, they're supposed to be regulators for fuks sake... they're going after insider trading with a balance sheet looking more criminally negligent and with lower assets to liabilities than Bernie Madoffs ponzi scheme... you couldn't make this shit up after 3 days straight of LSD!!!
Banksters die like these ones.
A New York Times affiliate goes to war against a crooked failed board and mgmt.
http://www.pressdemocrat.com/article/20110128/OPINION/110129499
80% are not paying attention and "have no idea"...Yet
by Ragnarok
on Fri, 01/28/2011 - 16:06
End the Fed!
I'm trying!
Jim Grant's a hero -- one of the few back in the 90s who was pointing out how inappropriate and dangerous derviatives were to municipal issuers.
Agreed, he actually had some good calls during the crash as well, recommended a few good convertible bond names. Definitely a sharp guy.
Absolutely
Jim Grant has always been a straight shooter. He is a good guy.
He is dead on. We need someone like him to head the treasury instead we have incompetents like Timmy which was no accident. Why would the head of the NY Fed be promoted to Secretary of Treasury when NY is where all the fraud was taking place right under timmys nose?
Medicated and manipulated. Can't we arrest the Fed via the WAR on Drugs?
I mean this sincerely: Ultimately, when the truth about The Federal Reserve Bank is revealed, whether in one year or 10, for mass consumption, it will be cast as a financially terroristic organization...and rightfully so.
All politicians who shelter, defend, provide excuses for or otherwise impede the disclosure of what The Fed is doing, and impede its dismantling, do so at their own peril.
Hey, the stock market ended down. That wasn't what I was promised. I want my money back.
Just cover yer margin call and back up the truck!
I keep fucking up the arithmetic problem.
calculator ftw!
sufficient persistance
Yes, the FED is a problem, but its central banking that is the real root of all our problems. As long as bankers have the power to create money (and use it to buy politicians), nothing will change.
And that is probably based on mark-to-aquisition price, aka mark-to-unicorns-and-fairy-dust.
HEY!! They could play in the Gold futures!!
HEY!! They could play in the Gold futures!!
"Criminal Reserve"
Love it ...
Tyler , are you of Irish descent ?
You certainly have the "Gift of the Gab"
;-)
R, D, Tea Party, Coffee Party, I don't care what political stripe you are; everyone should support a full audit of the FED. We deserve accountability.
audit the beast.
then kill it.
real published audit --> system collapse
I'd prefer time as much as possible to prepare.
refreshing
He and Marc Faber should have a genetically mutated love child that stalks banksters around the globe making them confess.
Edit: And the mutant child shall eat only gold.
Nobody expects the Bank Inquisition...Amongst our weaponry are such things as...
Nobody expects the Bank Inquisition...Amongst our weaponry are such things as...
Nobody expects the Bank Inquisition...Amongst our weaponry are such things as...
Amongst our weaponry are such things as...multiple superfluous posts?
Meh...The Hedge was bogged. Got spooked and began strapping on the bandeleros when a MRE fell on the keyboard.
Hysterical. Just don't go poking anyone with the "SOFT CUSHIONS!"
I am in charge of the comfy cushions thank you...
Came in late on a CNBC conversation, missed who said it. Something like the FED is inflicting screwflation on the middle class.
Our two weapons are fear and surprise...and ruthless efficiency..
MRE-three letters, four lies
I'm a bit surprised that someone like Grant - who seems to understand money - references the FRN as the "Greenback". One could argue that this term for the dollar has become widespread, but the Lincoln Greenback was a Treasury-issued currency. Issued without debt and interest to criminal central bankers. It was a marked shift from the central-bank issued money (through debt) and likely got Lincoln killed. To a true money-guy, this is a massive distinction/difference.
Great point! Can we now debate the term 'buck' or 'cabbage'?
@traderjoe
Exactly. And I'd love to bring the greenback back. End the FRB. Of course, this shouldn't diminish Jim Grant's excellent analysis.
tj: greenback:
http://www.songmeanings.net/songs/view/3530822107858609632/
"I don't give a damn...
Yup. Stock market up. Mortgage rates higher and food inflation scaring the world. Ben must be calling 60 minutes so he can tell everyone he would give himself an A++ as he is doing everything right and answered the bonus question correctly. Pompous ivory tower ass!!
Didn't The Ben Bernank tell 60 Minutes that he can stop inflation in 15 minutes?
Yeah, he can stop it anytime...he just doesn't want to...na na na na na!
NFLX straight vertical at day end. Whatever it takes to keep the QQQQs from collapsing.
THE FED IS GOD.
KNEEL.
I love how the twinkie from Bloomberg doesn't understand what he's saying so she resorts to giggling and being dismissive.
That's the problem with trying to actually present something of substance. People are too fucking stupid to understand it and start to tune out almost immediately. Now, if you were to have a sound effects board and bite the head off of clay bears...
Solid as Granit!
Grant has been on the mark since I knew of him 1990.
Wasn't he with BMO. I believe that's where he authored/edited the Interest Rate Observer.
Margaret Brennan is so fucking hot.
True that . And Sarah Eisen . Both of them are smoking hot .
I wonder if they take it in the butt?
An inappropriate, yet curiously intriguing, comment.
Margaret Brennan is so fucking hot.
Yes, I noticed that, as well. But I still like the fiery redhead, Liz Claman, even though Ron Paul had to explain to her the difference between monetary inflation and price inflation.
And today was a perfect example. This was a relief valve blow off day. Look at the chart. The market was on it's way down and down big when, all the sudden, it stopped, and traded sideways until closing. If today wasn't a perfect example of market manipulation, then there isn't one. It was a great chance to blow off some pressure. Look for a "relief" rally next week.
Let's not be too greedy . Most other days the market would have had the standard miracle rally from the lows .
Let's just wait and see if the Suez Canal is still open next week. If not, the exits will look like a fire in a crowded concet hall. Better get your protection on and pray Egypt doesn't totally blow up over the weekend. This could be the moment certain elements in the ME have been waiting for.
Quite depressing.
confess?
Those guys don't care about the people. They don't understand what if feels like for the common people. They feel to superior to give a fuck. They are and will always be home free.
Our last 2 generations have know peace at home, but the way they fuck up the foundations for their own profit , it may soon end it.
And by then we will be "stunned" how this could have ever happend.
In the US, you had the LA riots with the case of OJ. It shows how fast something can go bad.
It doesn't take much.
LA riots were because of the Rodney King beating, cops were aquitted for beating him on video. There were no riots about the oj trial
And today was a perfect example. This was a relief valve blow off day. Look at the chart. The market was on it's way down and down big when, all the sudden, it stopped, and traded sideways until closing. If today wasn't a perfect example of market manipulation, then there isn't one. It was a great chance to blow off some pressure. Look for a "relief" rally next week.
Who is the idiot who is across the table from this brilliant man? "We should hire you as a producer". Dumb as a stone. How is it possible she is on Bloomberg? What do they pay these 20 somethings????
Don't speak ill of the insanely attractive Margaret Brennan !
Dude you got to be kidding. She is NOTHING special looks-wise. Plus - being dumb as a stone does not help.
She takes it up the butt. Most asians do. It's common knowledge.
Brennan? Asian? If she were Asian she'd be smarter.
Brennan of course being an ancient Chinese name from the far travelling Irish Brennans who settled in Upper Mongolia before helping to build the Great Wall for payment in rice wine.
Don't even get me started on those dirty Micks and their Cleveland steamer and rusty trombone fetishes....sick.
History--there's no end to it!
Were the Brennans related to the Ho clan?
But she has a pen in her hand -- I think that's supposed to give the impression she can write.
A reporter? Nice try. She sounds like she has no clue as to what Grant is saying. Case in point...
"The New York Branch of the Fed is leveraged more than 80 to 1. Meaning, that a loss of asset value of less than 1.5% would send it into receivership if it were a different kind of institution..."
What the hell does she think this means? It's called Game Over Bitchez.
"But she has a pen in her hand -- I think that's supposed to give the impression she can write."
That's dang, blang funny right there.
"I'm only as smart as the woman I'm with,
and if she's a dunce I'm stupid at once, I'm flexible!" -- Martin Mull
No man she's got that cutesy look/smile , goddamn love it . I don't think she's dumb , but she does sort of stumble/freeze sometimes .
They can't all be Becky Quicks.
http://dealbreaker.com/_old/images/entries/beckyquickinwhite.jpg
must be an old photo - she actually looks cute, young & innocent, not the jaded, frenzied whore of today
Also the fuckwits couldn't even keep up with the visuals- there were only two!!,even when he told them which ones to show,just makes the whole Bloomberg channel look amateurish,and doesn't give Grant the respect he deserves.
At least they didn't have 4 chimpanzees shrieking over him. He actually got to speak.
Actually, it is a three-headed monkey.
Ha ha. "The Fed is running a balance sheet which if it were the balance sheet attached to a bank in the private sector would probably move the FDIC to shut it down."
No, the FDIC would never shut it down. It would just have the Treasury and the Fed funnel more Bennie Bux to the misguided institution. Although I do like Grant. Maybe he was being sarcastic.
He wasn't referring to Bair's FDIC...
How do I get a link to that bloomie video? I can't seem to find it.
anyone?
Thx in advance
Ned Lud
Trouble bringing it up also. Try reload. It's available now.
http://www.youtube.com/watch?v=bIw-ufWdWC8
Patrick Henry speech. Send this to everybody you know.
Did that bubble head actually think the amount was 2.4 billion?
Wow. ZH rules!
Fingers are starting to be pointed already. This is big stuff really. Cracks in the damn dam are appearing. There will be bitter clingers, but the people who don't want to be thrown to the mobs will start to sing like birds.
Self-determination. Self government. No more debt slavery.
I'll 2nd that .... in fact anything that brings closure to that fascist ponzi scheme called "democratic government" and a monopoly on money (and credit)
...freedom and free markets, only mechanisms that work for all of us
Now that Cabletown owns CNBC I am sure they will be more factual.
Oh, how wide is the equity exit door. Bids dropped 3-5% right off the bat.
Monday morning may not be so kind. GL all
They have spent 2 years buying up every single share in existence with the explicit rule that nobody can ever sell again with the attempts to sell for a profit in order to feign stability 20 years from now so I agree there is not a thing which can be done to prepare for even the mildest sell side volume that is in store especially one reliant upon false accounting, endless % monetary policy and a gentleman's handshake to not cannibalize your brother.
Go Jim. In appreciation of the fine work Zero Hedge has done today in bringing the most informative journalism on the globe with the utmost efficiency I have just donated. I hope others follow suit and support the cause of free press & the integrity we are so gifted with by supporting this fine symbol of freedom of press.
You are not your Khakis and to the mainstream media propaganda:
" We want you to hit us as hard as you can"
Holy shit... you're seeing this on a tertiary outer ring MSM channel?!?!? If this keeps up you might start seeing this kind of crap on CBS Nightly news. (NOT!)
See what happens when "The Bernank" takes the day off? DJIA down 166 and Bloomberg talkin' smack!?!?
"The Bernank!" - get out of that Davos Bordello and get your ass back to work, dammit!
Grant is super, and another great article today, Tyler. Viewing the responses, I can understand the angst at the old-timers leaving/taking a break. As a viewer, but an outsider, I have noticed a distinct troll emphasis/content in here for the past weeks/more likely months.
These little guys/girls are more worried about today than the big picture, about themselves than what is going on in America and the world.
This is why the X-generation, the me groupies, the high school students of the last 30 years, have led to our current problems--not the pre baby boomers, the baby boomers, but the one- parent freaks that we have produced from coke, meth, crystal meth, and (most probably) flouride!! who are concerned about themselves.
Because this is true, I see no short-term hope. It is all inter-related. If portion is weak, the whole wall falls.
the one new item is the fed shifting their debt to the treasury, which Grant assumes is legal. If the Fed and the Treasury were one continuous agency, which we were never led to believe, (ref term: Independent Fed), that this is in some ways the opposite problem of the GSE's, which claimed to be backed by the US government, but which those close to the law said they were not, backed by the US govt, which leads us to speculate, a) since the Fed is holding all this toxic MBS, that somehow they are trying to transfer that MBS from the GSE's to the Treasury and the deficit, because there never was a legitimate backstop in place. Suddenly the fine print is being used against the underwriters of the loans, and they don't care for it of course, and are trying to wiggle out by transferring the debt first to the Fed and secondly to the Taxpayer, because the GSEs never did guarantee those loans. And the Fed is not an agency of Treasury, but is a bank. I am not a screaming Tea Party advocate, but could become one very easily.
I always thought Meg Brennan was cute, but there is no question that she is yet another Fed-loving drone. I tell you people that think BBS is much better than CNBS - Not so! They are nothing but yet another liberal, plutocratic RAH, RAH machine.
yes Ben, go to confessions.com and do a one-click confession from one of the templates and all will be forgiven!!!!
Jim Grant and tyler durden are great Americans and market analysts.....Every other market pundit sucks donkey dicks.
66% look at the FED favorably???????????
Who the hell voted?
Was it BerNank, Geithner, and Jesus?
What a joke. It's all a Joke.
Pathetic.
Unfortunately it appears Vigilantism is going to be the only way any of these crooks will be stopped. I know that sounds 3rd Worldish but the USA is now past 3rd World but with Nukes. If it wasn't for that stash of warheads, the countries we owe would have attacked already.
What bothers me more than the 66% is the fact that 27% thought QE would "help the economy and create jobs" and the 35% who thought it would have "no effect". We all need to be telling a lot more people to wake up. And kudos should go to the network for giving Grant so much air time.
40% of Egyptians live in poverty. Is that what's required to get people to take notice? or does someone have to self-immolate?
Hay sus pay attention. 60+% LIKE the Fed chairman, Grant said he likes him too, he's like the professor who gives you an A with no term paper, but only half that number APPROVE of the job he is doing. Apparently someone is paying attention.
Funny how at the intro, when going over the poll numbers, although she mentions 33% of respondents worrying about QE2 potentially leading to inflation, they conveniently neglect to include that part on the display. Amazing how the media has gotten in bed with the govt. to keep a lid on the true inflationary pressures that are prevalent everywhere today...Well everywhere other than in Bernank's home.
Wonder how many more will have their "come to Jesus" moment now that they see the end game and their personal fortunes are at risk.
The second chart does not add up to 100%
Lets get this done Ron Paul...END THE FED..END THE FED...END THE FED
I just want to post because I can solve this Captcha
The Fed is levered? Levered what? WTF capital does the Fed actually have? The gold?
"Why Steal Less, when you can Steal More."
Wall Street Mantra
"Why Steal Less, when you can Steal More."
Wall Street Mantra
Has he ever been on CNBC, I wonder. If he has it was probably one time and that was it.
he used to be on there a lot
Grant used to be on Lou Rukeyser's Wall Street Week fairly regularly, as I recall. No discussions of such things in those days, but the Fed's role in the Wall Street corruption is only beginning to be revealed. I'm certainly happy to hear Grant openly supporting a hard money rule for the Fed to stop it from creating one crisis after another. The Fed's "flexibility" is what enables creation of the crisis. Money with stable value should be the Fed's one and only mandate. Or, end the Fed and do the same through the Treasury. Either way the financial elite must be brought under the rule of law.
The question for the FED is....'how can we keep the game going in our favor?' 'What can be done to make it look as though we are helping, but actually we maintain the same advantages as ever, if not expand them at the same time?' Maybe there is no Zimbabwe Outcome here, can we really expect anything at this point? Did anyone really expect the Fed to be doing what they are doing....no. When it all started happening I got short dollars in a big way, I thought there is no way the mkts will tolerate this crap and the fed will get crushed for its lack of respect for bond and FX mkts........................Wrong. Two years later, covered the trade for a scratch. I thought that was the retirement trade yet here we are predicting more doom and gloom, and we may just get it. However, the Fed would then have to start over from scratch, not an easy task. All we can do here is trade it. The reality is that as stupid as it gets, we can only trade whats there even though the Fed has turned it into a stupid circus act, and cheapened the entire system with a permanent bailout strategy.
The question for the FED is....'how can we keep the game going in our favor?' 'What can be done to make it look as though we are helping, but actually we maintain the same advantages as ever, if not expand them at the same time?' Maybe there is no Zimbabwe Outcome here, can we really expect anything at this point? Did anyone really expect the Fed to be doing what they are doing....no. When it all started happening I got short dollars in a big way, I thought there is no way the mkts will tolerate this crap and the fed will get crushed for its lack of respect for bond and FX mkts........................Wrong. Two years later, covered the trade for a scratch. I thought that was the retirement trade yet here we are predicting more doom and gloom, and we may just get it. However, the Fed would then have to start over from scratch, not an easy task. All we can do here is trade it. The reality is that as stupid as it gets, we can only trade whats there even though the Fed has turned it into a stupid circus act, and cheapened the entire system with a permanent bailout strategy.
I don't like this guy.
He said the FED was a government agency - not true.
He referred to the Federal Reserve Note as the greenback - not true, the greenback was a debt free currency issued by honest Abe Lincoln
How long will it be 'til "willie coyote" realises how far off the cliff he is and there's nothing, absolutely nothing, below !
Great article thank You for posting, i wish that this gentleman and more like him would speak up more often . A lot more often.
Despite market intervention/QE – natural market forces can not be stopped – only delayed.
When the market does reassert control (soon) - the reaction (the overdue correction) may be even more extreme due to that delay.
And some may erroneously refer to it as a Black Swan since it's an 'unexpected' event of large magnitude.
And they will be wrong because it can be predicted by some analysts.
http://stockmarket618.wordpress.com
Oh by the way "Sudden Debt". You have the best icon here. Jim is correct. Obviously so, however I think in the essence of global policy something will chage this all. I don't think these guys are that dumb. It would seen like it but lets not forget they have the very best minds on the planet advising them behind the scenes. The best money can buy so to speak. I am sure they are cooking up some new and unique plan the will change how we use money. In the true spirit of conspiracy I think a new monetary system is underway however they need to completely demloish the old one before such a system is implemented. These guys understand (to a degree) the effects of the monetary policy (perhaps and underestimation of the unforseen consequences, but I believe the problem arises in their lack of transparency. It is like a manager that constantly is planning change and fails to communicate the efficatious changes to their staff. It only fosters more rumors and in one sense produces just the effect that they wished to avoid. I know that the truth hurts at times but it is leadership such as this that is precisely what people need at this time. However that takes guts. It mightnot even be Bernanke but the Politicians and bankers he must listen too have none. Deceit only produces more deciet. People can handle the truth.
cheers,
In "Mr Market Miscalculates",
"Grant's, for most of its 20 years of existence, has refused to try to predict short-and medium-term swings in interest rates. It can't be done, we've protested"
Contrary to economic theory, & Nobel laureate, Dr. Milton Friedman, monetary lags are not “long and variable”. The lags for monetary flows (MVt), i.e. the proxies for (1) real-growth, and for (2) inflation indices, are historically (for the last 97 years), always, fixed in length.
I cacked the code in July 1979.
My predcition for AAA corporate bond yields in 1981 was 15.48%. AAA corporate yields hit 15.49%. I was off by .01%.
Of course the Fed manipulates the stock market. Bernanke told you himself. He wants a stock bubble so consumers can feel the economy is booming. However, I feel the Bernanke quite foolish in this mandate. Simply, because like a simple Keynesian proposal, that consumers have a lot of fear, that is why they are not spending doesn't describe this recession. Austrians simple view is much more correct than a consumer cycle, where the consumer simply realized he spent too much money, and than one day decided to save more. Savings have been stretched thin. Banks have been overleveraged, consumers as well. When the interest rates resetted, it showed that mortgage holders couldn't refinance, because they didn't have disposable income to do so, or savings, money that they don't spend allows them to be flexible to make higher payments. Simply put, the economy is broke, with very little savings. Not enough deposit money, and too much over-leveraging in the banks part, as well as consumer parts as well. Economic deflation didn't happen because of lack of spending, it happened, because of too much spending, little savings, and inflexilibility to adjust spending, which could of only resulted if there was existing savings that was enough to make it happen. Therefore no savings is good for short term growth with shocks that can derail it, while savings helps ensures long term growth that can withstand the speed bumps of a dynamic economy for long term growth. Lack of consumer spending wasn't the primary cause of economic deflation, but a result of it, because let's face it, Americans are not frugal people, not by a long shot in aggregate. The Fed in last couple of decades reward the speculators, and only concerned with short term growth. A speculatory internet bubble blew, the Fed rewarded them with cheap money to create a bigger speculatory bubble, the financial institutions involved in that speculatory bubble were bailed out again, by the Fed, and the US government, so it shows that the Fed, or government don't care for long term sustainable growth, they only care about short term, and want as much spending as possible make the economy boom again, meanwhile continuing to reward short term thinking. There's a word for it, called bubble economics. The Fed originally wasn't suppose to reward speculators, but it seems the Fed has reversed it's policy, or inverted it. The Fed wants the stock market to get higher, higher like what, the NASDAQ bubble that involved the internet, or does the Fed want economic long term stability, and allow the stock markets reflect actual economic productivity?