The One Chart Von Bernankestein Will Never Admit To Seeing

Tyler Durden's picture

Charting Austrian Money Supply, the Fed's outright security holdings, and commodity prices. Any questions?

(no snow was abused as a strawman excuse for the Fed's mandate of "price stability" in the making of this chart)

Courtesy of Sean Corrigan


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tellsometruth's picture

nope that about somes it up...

Popo's picture

Hmm... I'd love to see the same clean correlation... But when I look at the chart I see the AMS spike massively in August of '08. That's before QE1.

Someone help me out here. I agree with the premise, but this particular chart doesn't support the above conclusion IMHO.

HoofHearted's picture

Looks like a good clean *lagged* correlation to me. AMS rises and within six or nine months, the prices of commodities follow. Of course this is just a small part of a much larger time series that could be graphed, but my guess is you'd continue to see this.

cswjr's picture

Need some way of backing out declines in the DXY for reasons other than massive printing of money.  Haven't thought about the validity of it much, but regressing D(DXY) v c, D(AMS) and plotting the residuals vs D(CDF), etc. might do the trick.  'course, there's also China buying up commodities by the boatload, which isn't reflected in the DXY.

Mikey3211's picture


not quite good enough for me. Coincidence does not equal correlation. As you said, more data is needed, as is some idea of whatever the underlying mechanism is.

I'm sure that you have some ideas - pity it's so damn hard to test them.

defender's picture

I think the explanation for that is the sudden injection of $700 bln from TARP, but it could be any of the other programs in that time frame that involved bags of cash and helicopters.

hedgeless_horseman's picture

Silly little monkey, the Fed used standard measures before QE, thus causing causing AMS to increase before QE.

tom's picture

I guess the date axis just isn't lined up very well. Nothing much happened with the money supply, no matter how you count it, till September 08.

ebworthen's picture

AMS Spike?

Digital money printing.

You don't need to wait for bills to be printed and distributed, just a few keystrokes and...Viola!

Tarp as others mentioned.

Then...the FED money lending at the back door to the TBTF banks at 0.25%.

A great deal of this was likely done overnight and all off the books.

ThreeTrees's picture

The part that strikes me is how after QE1 commodity prices mirror (but lag) the MMS rather than behave of their own accord like they did before the crash.

Golden monkey's picture


Do you think that, once the USD will be worthless, the lemmings will still rush to go to work the next Monday morning?


High Plains Drifter's picture

Well they are creatures of habit. I mean, heck, after work it is time for football and beer.

flacon's picture

Don't knock BEER! The oldest beverage known to mankind! LOL! :)

Rodent Freikorps's picture

Beer is the reason we have civilization.

Man needed to settle down and grow crops to insure a good supply of grains for beer production.

Only bacon is more central to cosmic goodness.

GoinFawr's picture

Hahahaha! Caught me completely off guard with that last sentence! effing lovely, that.

Rodent Freikorps's picture

The old reversal of expectations.

I need to write a book. You wouldn't believe the number of people I work with who think they are funny. Down right painful sometimes.

ebworthen's picture


Take that chart and plug in bacon somewhere; it has almost doubled in the past year.

saulysw's picture

Where does chololate fit into the cosmic goodness scale?


Nefarious Deeds's picture
“Beer is proof that God loves us and wants us to be happy.”  Benjamin Franklin
slewie the pi-rat's picture




hi.  and we know-how many benjamins it takes to learn that!

Rusty Shorts's picture

Well, Jebus very first miracle was to turn "water to wine".

FeralSerf's picture

What about water?

 And milk -- I drank milk before tasted beer.

SteveNYC's picture

Yes. In the US, there is no other way, no other way that most can even comprehend to think. It will be off to work, purely for the sake of needing to occupy the restless mind that strikes the fear of God into its unconscious host if its needs are not sated, and the habitual behaviour of obedience.

There will be "hope" of a new dawn all the while, being pedalled by some huckster sponsored by the banks who have looted the gold and anything of value.

As all things end, I just don't think that this "thing" we call society ends well.....

Bringin It's picture

Steven - I'm compelled to restate your excellent words. 

purely for the sake of slaking the need to occupy the restless mind that strikes fear into many.  

re. ends well.  Everyone has a chance to wake up.

Thanks for your post.

Psquared's picture

We have learned to escape, repress and deny our existential anxiety in many ways. Working to pay for things which we use to distract us from finding real meaning in our lives is but one.

takeaction's picture

This is my first post.  Wow....your comment is astounding.  So true.

RockyRacoon's picture

Welcome!   Now I'd like to hear your story -- how 'bout some astounding info from your corner of the world, such that it is.

Bringin It's picture

Excellent post.  People are socialized to find happiness and meaning in destructive ways when they don't have to.

We have learned to escape, repress and deny our existential anxiety in many ways. Working to pay for things which we use to distract us from finding real meaning in our lives is but one.

I think people have to break out of this realization via consumption approach.

StychoKiller's picture

Alleviate some suffering then, Buddha sez thanks...

chistletoe's picture

yes, but is anxiety really "existential"?

Or, is it something that we all are taught from birth,

taught from our parents and educators,

taught from hours and hours of lookiing at tv, movies, shopping ...

being constantly confronted with our own faults and lack of self-worth?

(so that we may all work harder and spend more, to try to overcome it)


Ever travelled in a third-world nation?  I mean, not just staying in the local Mariott,

but eating, dancing, sleeping and praying with the people?


Its a warm, tropical breeze that knocks you over with its joy, fun, and peacefulness.

This society really, really, really sucks ....

Double down's picture

There is no "worthless".  Negative infinity in action.  Something else will break

whatz that smell's picture

"we had to destroy the market to save it."

...alan greenspan describing his creative destruction psychosis.

RockyRacoon's picture

The Ben Tre defense doesn't work any longer.

hampsterwheel's picture

When the Concentration camps were liberated the prisoners stood around not knowing what to do for weeks - it will be the same here. It will take a few months for the anger to really boil over --

ThirdCoastSurfer's picture

"Real wealth is represented by actual items that people want or need. This can be food, land, natural resources, buildings, factories etc. ...According to Exters theory ..., the levels of the pyramid disappear in order from highest to lowest. "

The second highest tier is "Misc" which represents: "land, buildings, factories etc." It seems counterintuitive that aggregate demand for these items would decrease at greater pace and thus actually proportionately expand investment in stocks and bonds.  


gwar5's picture

We want a gold standard back. Economic empowerment. This sucks.

Herd Redirection Committee's picture

All I want is one set of rules for everybody.  Is that so much to ask for?  We don't need more rules or regulations, necessarily, we need the existing ones to be enforced, something that has definitely not been the case the last few years.

Check out the latest from the Capital Research Institute

"What is Wealth?"

Wealthy.  We have all wanted to be ‘it’ at one point or another.  But really, what is wealth?  Is it numbers on a computer screen, pieces of paper, gold bars?  Strictly speaking, it is one’s net asset position, of course.  But in a more fundamental sense, what is it?  Wealth is something we want, and yet, we go through most of our lives confusing currency and wealth.  The end result: the never-ending pursuit of ever-increasing digits on a computer screen.   But arguably wealth is a lot more than just money, it is anything “of great worth or quality”.  The other aspects of wealth have been massively downplayed, for most of the last century.

Real wealth is many things, but what will prove to be most valuable in the years to come?  The Capital Research Institute presents: The Top Alternative Measures of Wealth for the 21st Century...


topcallingtroll's picture

Happiness, leisure, good health, and good pussy.  That is true wealth. Everything else is just a distraction.

plocequ1's picture

Amen Brother. I may not be rich, But i do have what you mentioned including love and God. Thats why i dont give a fuck about everything else.

topcallingtroll's picture

our zen master speaks!  He often teaches us with blank comments.

plocequ1's picture

 Yes, My son. Sometimes words are futile.. Sometimes we need a moment of silence.

FEDbuster's picture

Good health requires a healthy diet which will soon be more expensive.  Good pussy has always been expensive.

ebworthen's picture

Lol, yes, true that.  Whether outright paid for or maintained in relationship status Women are not attracted to a lack of money or power.

RockyRacoon's picture

It's in their DNA to select the one most able to provide for the offspring.   No rocket science there.   Big pecs, a three-piece suit, and a full wallet will attract most women whether they admit it or not.  Ladies: Note I said "most".  Feel free to exclude your individual selves as needed.  I don't need no snarky comebacks for laying out the most obvious of truths.  Some government subsidized study has without doubt shown this to be true; although its publication has been suppressed for obvious reasons.  It's amazing how much tax money is spent to prove the obvious:  Rich people are happier than poor people.  I coulda told 'em that for $1.50.

BigJim's picture

"Women are not attracted to a lack of money or power."

No, they're not attracted by a lack of those things. But that's quite different to saying women are repelled by a lack of those things.

I know plenty of non-wealthy, non-powerful guys who get very hot women.

Gold-diggers are attracted to money and power. If you think you need money and power to get a hot woman, you need re-educating in what it is to be a man.