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Rosenberg's Takeaways From Bernanke's Speech: "Cause For Pause"

Tyler Durden's picture


Yesterday we brought you Goldman's quite bearish takeway on Bernanke's speech (excluding the highly irrelevant Jamie Dimon monologue detour: we can't wait to hear what the JPM CEO says once it is announced that Glass-Steagall is being reinstated). Below we present Rosie's key takeaways on Bernanke's remarks.


  1. The Fed seems to have cut its second-half forecast of near-4% real growth to something closer to 2.5-3.0% ... growth is now seen to pick up just "somewhat" in the second half of the year from what looks like a sub-2% trend in the first half. Not exactly a ringing endorsement for pro-growth cyclically sensitive investments.
  2. The broad focus seems squarely on the labour market — what seems to be Bernanke's greatest worry is lack of traction. The words "jobs", "labour", "employment" and "unemployment" collectively showed up no fewer than 23 times. The comments on how aggregate hours worked are still more below the cycle high than was the case at the depths of the 1982 should be resonating on even the most ardent growth bulls and inflation-phobes.
  3. On fiscal policy, his comment suggests that he is concerned that the zealots will tighten the budgetary screws too hard over the near term — hence his emphasis on the need for "long-term" solutions.
  4. The Fed expects commodity prices to stabilize and as such for inflation to decline going forward. Interesting to see the analysis that ALL of the build-up of inflation so far has been due to gas prices, which seem to have peaked.
  5. Another QE round cannot be dismissed after reading this sombre assessment of the macro backdrop; at the least, the funds rate stays on hold and that should provide an anchor for yields out the steep Treasury curve.

Bernanke said the 'jobs situation remains far from normal" and as such, this recovery cannot be regarded as being "truly established." That is quite an admission — free money, a tripling of the Fed's balance sheets and 10% deficit/GDP ratios have fallen short of establishing an established recovery. Cause for pause.

Source: Gluskin Sheff


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Wed, 06/08/2011 - 11:20 | 1350984 FOC 1183
FOC 1183's picture

Jamie's monolog detour was so rhetorical I almost expected Bernanke to move on to the next question

Wed, 06/08/2011 - 11:31 | 1351005 Temporalist
Wed, 06/08/2011 - 12:42 | 1351341 Problem Is
Problem Is's picture


"Oh, woh, woh, Jamie's cryin'..."

Wed, 06/08/2011 - 12:22 | 1351257 Arrowflinger
Arrowflinger's picture

There was another take to be had in Dimon's recitation of all of the fraudulent financial contrivances now banned, dead, or producing entity-threatening losses.

If FIRE became an unsustainable 40% of markets and 20% of the economy, doesn't his admission that the engines of this ascendancy are now blown translate into that the reversion to mean will require 50% of banks to go away?

JPM only exists because of trading profits from getting free Fed money and buying $UST's  and commodities. Even those are not going to outrun costs and shrinking banking revenues.

Wed, 06/08/2011 - 12:29 | 1351291 gabeh73
gabeh73's picture


I made this video to explain why the economy is tanking and what will be required to get QE3

Wed, 06/08/2011 - 16:55 | 1352403 Chuck Walla
Chuck Walla's picture

I tend to agree with you. I think its let us suffer, then Braack can come to the rescue. But this is all about timing. No way Big O can get re-elected if this goes on into 2012.

Wed, 06/08/2011 - 11:21 | 1350987 Ray1968
Ray1968's picture

Why isn't Jamie Dimon in jail???

Wed, 06/08/2011 - 11:36 | 1351057 schoolsout
schoolsout's picture


Jamie Dimon Becomes Wall Street’s Hero Figure
Wed, 06/08/2011 - 11:58 | 1351142 SRV - ES339
SRV - ES339's picture

Weiner's career is over for texting some lewd pics, and this sorry excuse for a human being is whining about regulation (after he and his buddies blow up the world economy) while his income skyrockets to $50M a year!

Jail(?)... screw that! When does congress pass the justifiable homicide waiver for bank CEOs?

Wed, 06/08/2011 - 11:22 | 1350990 hotkarlandthecl...
hotkarlandtheclevelandsteamers's picture

Rosie was bearish at 700 on the S&P went bullish at 1360...this guy is the ultimate contrarian.

Wed, 06/08/2011 - 11:39 | 1351054 Gubbmint Cheese
Gubbmint Cheese's picture

cherry picking stats here a bit.. Rosie was bearish at about 1,200 (before the top) and continues to be bearish. A few weeks ago he acknowledged that the market could go higher because of technicals.

I too am bearish - but I accept the market 'could go higher' before it ultimately blows up.

there is a big difference between that, and being 'bullish'

Wed, 06/08/2011 - 11:40 | 1351076 ihedgemyhedges
ihedgemyhedges's picture

Don't forget Bill Gross.  Shorted treasuries 50 bps ago and said go long equities at same time............

Wed, 06/08/2011 - 11:24 | 1350996 snowball777
snowball777's picture

Growth: Sub-2% H1, Sub-1% H2.

Job counts mean squat: aggregate income is the only meaningful metric for labor recovery.

3. The "just the tip" method of fiscal reform.

5. Yes, yield will be nailed to the floor for years.

Who's gonna ride, bitchez?

Wed, 06/08/2011 - 11:30 | 1351002 Cdad
Cdad's picture

(excluding the highly irrelevant Jamie Dimon monolog detour: we can't wait to hear what the JPM CEO once it is announced that Glass-Steagall is being renstated)

What, does anyone really doubt: 1. the power of J. Dimon whining?  2.  the fact that over regulation is the true source of criminal syndicate Wall Street banker problems?

/sarc off

Anyway, isn't it high time that J. Dimon considers spending more time with family?

Wed, 06/08/2011 - 11:36 | 1351052 JohnG
JohnG's picture

By "family," do you mean worms?

Wed, 06/08/2011 - 11:42 | 1351089 Cdad
Cdad's picture

We all know that bankers have been working very hard on the wealth effect...which has bankrupting all of us.  And I am sure the wife and kids would benefit, as would a grateful nation, if J. Dimon would simply decide to, at least, take the summer doldrums off.

That is what I mean.


Wed, 06/08/2011 - 11:48 | 1351121 JohnG
JohnG's picture

OK.  He should just retire and die imho.

Worm food.

Also, there is no better fertilizer than composted manure.

Wed, 06/08/2011 - 11:28 | 1351012 inkarri9
inkarri9's picture

I found it a bit comical that it was Jamie D. who said something along the lines of "the bad mortgage guys are gone" in his speech but yet isn't he one of the bad mortgage guys?  


Wed, 06/08/2011 - 11:34 | 1351014 TaxSlave
TaxSlave's picture

"Cause for pause."


Yet there will be no pause.

You are owned by this faux debt, they will see you killed before they allow you to repudiate it.


Wed, 06/08/2011 - 11:34 | 1351020 Hedgetard55
Hedgetard55's picture

Rosie still bullish?

Wed, 06/08/2011 - 11:31 | 1351025 zen0
zen0's picture

It is not surprising that Bernanke focuses on employment. This was the whole purpose of the Keyne's General Theory of Employment, Interest, and Money.


Also, as Keynes notes from the Preface to the German edition:


Nevertheless the theory of output as a whole, which is what the following book purports to provide, is much more easily adapted to the conditions of a totalitarian state, than is the theory of the production and distribution of a given output produced under conditions of free competition and a large measure of laissez-faire .

Wed, 06/08/2011 - 11:35 | 1351051 SheepDog-One
SheepDog-One's picture

Hard to have employment grow when youve sold all your production overseas and the nations #1 employer is Walmart, #2 employer apparently McDonalds.

Wed, 06/08/2011 - 11:59 | 1351148 Cleanclog
Cleanclog's picture

Yep.  Disney is cutting jobs now.  All the fantasy and magical thinking is on Wall Street, not Main Street, Fantasyland nor the Magical Kingdom.  The Happiest Place on Earth is no longer the Disney Parks but the banking basements.  Sigh.

Wed, 06/08/2011 - 11:36 | 1351034 MarketTruth
MarketTruth's picture

So if growth is 2.5% yet REAL inflation is 6% that means....

Wed, 06/08/2011 - 11:48 | 1351117 Tuco Benedicto ...
Tuco Benedicto Pacifico Juan Maria Ramirez's picture

Exactly, we are going backwards in real terms and nobody except intelligent people ever mention that fact.  Good job!


Tuco Benedicto Pacifico Juan Maria Ramirez

Wed, 06/08/2011 - 12:34 | 1351298 NotApplicable
NotApplicable's picture

2.5 steps forward and 6 steps back?

Wed, 06/08/2011 - 11:33 | 1351036 AldoHux_IV
AldoHux_IV's picture

Inflation-phobes or people just concerned about currency destruction in a time of depression?

Wed, 06/08/2011 - 11:37 | 1351039 Quinvarius
Quinvarius's picture

I have yet to see anyone bullish after Bernanke's comments, even though I heard QE and low rates forever.  I don't like stocks.  But I must now conclude they are due for a big rally.

Wed, 06/08/2011 - 11:38 | 1351067 Boston
Boston's picture

Um, what did the markets do IMMEDIATELY after Bernanke's Jackson Hole speech in late August of last year?

Wed, 06/08/2011 - 12:01 | 1351153 Quinvarius
Quinvarius's picture

Bernanke started his speech at 3:45pm.  He announced continued QE 25 minutes and 40 seconds into that speech.  The fact that GS sent out multiple comments insinuating we are all doomed should have been a big tip off as to the reality of the situation.

Wed, 06/08/2011 - 11:37 | 1351068 SheepDog-One
SheepDog-One's picture

Really, well lets hear your opinion on how they plan on providing a QE that would fool anyone. What, they just print totaly imaginary money out of thin air? Its not 2008 anymore, thats not fooling anyone so how do you see a QE playing out?

Wed, 06/08/2011 - 11:57 | 1351136 Quinvarius
Quinvarius's picture

Bernanke announced exactly the QE I was expecting.  Reinvestment of payments on existing balance sheet items and low rates.  I don't understand why everyone is in such denial.  It is like a mass psychosis.  And when I see that, I know a lot of people are wrong.  Reinvesting interest and principal on 2.5 trillion dollars is a lot of QE.  It is just an accounting gimmick to say it is all rollover.

Wed, 06/08/2011 - 12:03 | 1351178 SheepDog-One
SheepDog-One's picture

Theyre gonna roll it over, re-invest the interest? Ok well who is that supposed to impress? And who's paying interest? Certainly not Mr Market Frankenstein monster with his $8 billion daily crank habit.

Wed, 06/08/2011 - 12:37 | 1351309 gabeh73
gabeh73's picture


All the mainstream academics already support QE3. Sumner, Tyler Cowen, Paul Krugman: Now they just need to brow beat the tea partiers as the markets crash and the path will be cleared to renew the pruchases of US government bonds.

Wed, 06/08/2011 - 11:37 | 1351040 SheepDog-One
SheepDog-One's picture

Now that they have Mr Frankenstein Market hooked on a $7 billion per day crank habit, lets pause giving it to him and see what happens. This should be great fun to watch as Mr Market doesnt get his daily fix and goes on a murderous rampage thru the Wall St village.

Wed, 06/08/2011 - 12:07 | 1351181 Franken_Stein
Franken_Stein's picture


Frankenstein Market - I like that term.

Bernanke is assembling his monetary monsters in the cellars of Marriner Eccles building, to be unleashed on the American public at the next FOMC meeting.


Wed, 06/08/2011 - 11:35 | 1351048 TooBearish
TooBearish's picture

Have a salad Rosie and take a seat- lay off the eggs when u having "breakfast with Rosie"

Wed, 06/08/2011 - 11:40 | 1351077 spartan117
spartan117's picture

Cause for pause?

I'll believe it when I see it.  Who's going to buy all those treasurys needed to pay for deficit spending?  Federal government going to cut 1.5 trillion from the annual budget starting July 2011?  Bring it.

Wed, 06/08/2011 - 11:46 | 1351092 Juice Box
Juice Box's picture

I read his "Breakfast with Dave" report every morning, and he always has great tidbits of info, but the guy has been way off on the market for a while.  After being a Bear for two years, he just went bullish one month ago - great timing.

He is better at bonds. 

Wed, 06/08/2011 - 12:08 | 1351197 Johnny Lawrence
Johnny Lawrence's picture

He didn't go bullish.  I wish people will read the full context.  He said that technically the market looked like it would go higher.  It wasn't a change in his fundamental outlook.

But I agree that he's missed the runup in equities over the last couple years, but he did call the 2008 crash and he's been hyping gold for at least the past 5-6 years.

If anything, I give him credit for speaking the truth about the economy despite being one of the most well-know economists on the street.  He doesn't cheerlead like everyone else.

Wed, 06/08/2011 - 13:40 | 1351556 hbjork1
hbjork1's picture

And it is one thing to be commenting on the market and another to be predicting FED pumping.  FED action probably has created much of the bull run.


Wed, 06/08/2011 - 11:47 | 1351110 SheepDog-One
SheepDog-One's picture

'This recovery cannot be regarded as being 'truly established'...LULZ yea real unemployment 25% at least, record high bankruptcies, worst housing market ever, 50 million americans only eat and live due to food stamps and 99 weeks of free govt checks, and the only economic activity is totaly synthetic 100% dependant on ZIRP free money flow from FED to banks to stocks to bonds.

#1 employer is Walmart, #2 employer apparently McDonalds, and Bernank dances on the head of a pin saying 'Welllll 'the recovery' is a bit short of being totaly confirmed right now'. Totaly tragicomedy is what it really is. And a stupid dumbed down general public to boot.

Wed, 06/08/2011 - 12:06 | 1351175 bubba1231
bubba1231's picture



The banks - especially JPM DID NOT cause the meltdown.  You want a culprit?  Look in the mirror.  The average American caused the meltdown as much as anyone buying into the real estate hype.  Throw in Barney Frank and others and there are your culprits.  The banks were just intermediaries...

Wed, 06/08/2011 - 12:08 | 1351188 Franken_Stein
Franken_Stein's picture


... but also main beneficiaries.

Don't let them off the hook here.


Wed, 06/08/2011 - 13:01 | 1351386 Problem Is
Problem Is's picture

"The banks - especially JPM DID NOT cause the meltdown."

Who are you? A sock puppet for Jamie & Lloyd?
The Wall Street TBTF derivative whores CAUSED the financial collapse...

Then used their bought, bribed and owned political useful idiots to bail out their loses with $$$Trillions in tax payer money and debt continuing to this very day...

Wall Street TBTFs looted Fannie and Freddie (a bad idea, agreed), for mega tax payer loses, legislated  by Wall Street political whores like Frank, Shelby, Dodd and of course Obama Bin Lyin'...

Wall Street caused the crash... Wall Street needs to pay... Jail time for Jamie & Lloyd, Amerika's Shoe Shine Boys...

Wed, 06/08/2011 - 14:03 | 1351657 JW n FL
JW n FL's picture
by bubba1231
on Wed, 06/08/2011 - 12:06




The banks - especially JPM DID NOT cause the meltdown.  You want a culprit?  Look in the mirror.  The average American caused the meltdown as much as anyone buying into the real estate hype.  Throw in Barney Frank and others and there are your culprits.  The banks were just intermediaries...



Pay Attention stupid.


Corporations Own the Lobby!


The Lobby Owns the Government!


Law Enforcement works for the Duly Elected Lobby Whores!


We the People = Screwed!


do you want to know who owns your favorite Republican? 


there is no difference between a republican and democrat.. other than what they say on T.V. for you to listen too.. the dog and pony show is nothing more than a show.. to keep people like you transfixed on singular thoughts that have nothing to do with the river of money that they all drink from.

Wed, 06/08/2011 - 14:28 | 1351743 Problem Is
Problem Is's picture

+5... Accurate analysis...

Wed, 06/08/2011 - 12:04 | 1351186 Cone of Uncertainty
Cone of Uncertainty's picture

Jamie Dimon is a little cunt, fuck him.

Wed, 06/08/2011 - 12:10 | 1351193 Franken_Stein
Franken_Stein's picture


Asscunt, to be precise.

Btw, some days ago was 30th anniversary of the first HIV case in the U.S. .


Wed, 06/08/2011 - 12:08 | 1351199 Franken_Stein
Franken_Stein's picture


Does anybody still remember the 1907 collapse of the Knickerbocker Trust fund ?

It was horrible to say the least.


Wed, 06/08/2011 - 13:47 | 1351590 hbjork1
hbjork1's picture

I don't remember that one.  Do you?

I do remember poliomyelitis which, unlike Aids, affected mostly innocent young people.  Worst cases would up in an iron lung to stay alive.  It is now only history.  With luck, Aids will now go the same route.

Wed, 06/08/2011 - 12:13 | 1351222 Curtis LeMay
Curtis LeMay's picture

Goldman's quite bearish takeway on Bernanke's speech 

Is that right?

Well, here's something for Obama, Bernanke, Timmayy and the trivial leeches at 85 Broad Street to chew on:

"U.S. debt to exceed size of economy this year"

6:03 a.m. CDTJune 8, 2011,0,1361927.story


Wed, 06/08/2011 - 12:40 | 1351331 NotApplicable
NotApplicable's picture

Well, it's not like much of the US economy exists outside of the financial/debt sector anyway.

Wed, 06/08/2011 - 13:20 | 1351487 Curtis LeMay
Curtis LeMay's picture

Great, yet more verbal diarreah/utter insanity from a EUnuch...

Does your mother know you tried to post here?

Long live ZH!

Wed, 06/08/2011 - 14:00 | 1351648 hbjork1
hbjork1's picture

Curtis,  we need you now.

Obama doesn't know what to do and, IMO, Bernanke, Timmayy and 85 Broad  Street will close their eyes and try to keep kicking the can down the road hoping for an American miracle like Apollo 13.  What they have been engineering is closer to is Apollo I.


Wed, 06/08/2011 - 12:33 | 1351306 JW n FL
JW n FL's picture

someone needs to pass out the pom, poms.. so the cheerleaders can get back on pepping "We the Sheepeople" into stocks! how many times earnings? YAYYYYYY!!!


Put some lipstick on those pigs and gettem movin!! Come on girls! show a lil leg! gewt those boys thinking with their lil heads! that will get the markets un-forzen! (minus POMO)


everyone ready for some pain with a lil forced austerity sprinkled on top!


well not everyone, but the majority to be sure! 59% of the Sheepeople recieve some kind of Goobermint Help! and the Minority with a well funded Lobby want the majority to be hungry! it is not like there are bench marks through out history to review with regard to a hungry mob and what a hungry mob does for everyone's quality of life! Who cares!! Let them Starve, we will offer cake later after we thin the herd some!


everyone does understand that the over all goal is population control? and what better way to control the population than to let the population fight each other for scraps of food!

Wed, 06/08/2011 - 13:02 | 1351399 JW n FL
JW n FL's picture

once the population is reigned in..


it is easier to kill a million people in this day and age of instant communication and information than manage a million people.


finite resources and over development of the United States..


what happens when hunger is created in the masses? I dont care what your beliefs are.. but history has shown us again and again that when you have a hungry mob.. or a hungry enough mob.. what the result of the mob + hunger is DEATH!


factor in we are talking about America where there are 5 guns per person and 10 Billion Bullets a year sold (10 billion is a real number, use google for ATF numbers). sprinkle in some forced austerity and BOOM! you have Hunger Riots which turn into Racial Riots or God Knows What kind of Riots.. but the end result will be a much smaller Mob to have to manage.. and the Mob that is left will be so much more manageable after all the death and hunger..


Finite Resources SUDDENLY are going to last a LOT! Longer!


But more important than even that, the Mob is now manageable.. power will be restored to the people who created these recession(s) / depression(s), the same people who create the Faux Fight to cause Austerity to reign down on the Sheepeople are the same people who will be better able to control whats left after the fires get put out.


the passionate people, the people who care and who would fight for the rights of the people.. will surely be some of the first killed. the willing to fight for their rights will be eliminated and only the sheepeople or mostly the sheepeople will be what is left.. there is no World War to send these people who are willing to die for their beliefs too.. these people who would fight to the death for their beliefs are the Biggest Danger to the Lobby Owners. People who believe in the Constitution and People willing to fight for and even if need be die for the Constitution are the threat.


What easier way that to let the stupid sheepeople kill the people with some kind of real belief system? whos left after all the little people get done killing each other? who is left once the masses are worked up into a hornets nest? who will suffer the most when the masses start killing one another?


not the Goobermint! they are all going underground! not me and my kind we are going to the Bahamas or other.. the poor, hungry belief ridden people will be left to die and suffer and the cowards who ran and hid from the fighting will be what is left to manage when the dust settles.


The Cowards are all that will be left once the fighting dies down. The Cowards who dont care and just want to make everyone happy! even if it means them fucking themselves in the ass with a dildo becuase the creme' that rises to the top is to fucking lazy to do even that any more.


America is to filled with people who have guns and are willing to fight.. that is not a controllable crowd.. or more to the point they want an easier crowd to control than what is here now.


nothing but civil unrest comes from starving people and that is what a LOT! of you have talked yourselves into is a good thing for this Country.. and the top 1% of 1% just wants control over an easy going group of sheep. Civil unrest, let the hungry starve and let the top 1% or 1% have exactly what they want.. because it is good for you how? You live out in the middle of no where? well lets hope the hungry crowd doesnt find you cowards out there hiding! while the real men who believe in something die for no reason other than to clear the road for the top 1% of the 1%.



Wed, 06/08/2011 - 13:30 | 1351519 Eireann go Brach
Eireann go Brach's picture

There are no more experts! Just people spewing verbal diarrhoea from their mouths, including 80% of people on here. We are in unprecedented times and no one has any idea how this will play out! 

Wed, 06/08/2011 - 14:13 | 1351700 JW n FL
JW n FL's picture

what do you mean? like salesmen selling something?

like this?

I would like a lag button for their mouths!

Wed, 06/08/2011 - 13:48 | 1351602 AmazingLarry
AmazingLarry's picture

Silly Canadians and their "labour." 

Wed, 06/08/2011 - 14:13 | 1351674 Bob Paulson
Bob Paulson's picture

Rosenberg has no credibilty whatsoever. As one of the biggest bears I've ever come across, he goes bullish, when? April 27th, 2011, the absolute peak of the market


and then, after all the bad calls, has the hide to start charging for his rubbish report Breakfast With Dave.

Wed, 06/08/2011 - 17:19 | 1352492 alangreedspank
alangreedspank's picture


Does the Bernanke really think raising oil prices cause inflation ?


Wed, 06/08/2011 - 17:29 | 1352531 alangreedspank
alangreedspank's picture



Wed, 06/08/2011 - 17:37 | 1352576 JR
JR's picture

Here's a partial take from Robert Scheer regarding Bernanke's "much anticipated remarks” yesterday in his column “The Bernanke Scandal: Full-Frontal Cluelessness;” Bernanke, says Scheer, is putting the Big Lie technique to work, employed as he is “by a huge banking lobby…” Says Scheer :

“His full statement stands as a classic example of the limits of economic language as morally descriptive: ‘Overall, the economic recovery appears to be continuing at a moderate pace, albeit at a rate that is both uneven across sectors and frustratingly slow from the perspective of millions of unemployed and underemployed workers.’ Frustratingly slow—how about going bat nuts with fear over not being able to make your mortgage payment and losing your home? Tell it to workers who must contend with stagnant wage rates and sharply rising gas and food costs as better jobs and therefore consumer demand move offshore. Bernanke takes low wages to be reassuring news on what he sees as the all-important inflation front: ‘ ... Subdued unit labor costs should remain a restraining influence on inflation.’

All the while, says Scheer: “At home we are experiencing a social tsunami with the disappearance of a middle-class workforce of stakeholders who were assumed by observers as varied as Thomas Jefferson and Alexis de Tocqueville to be the very bedrock of America’s experiment in freedom. Many with jobs are struggling desperately to get by as the average workweek and pay scales fall, and countless workers find themselves settling for rewards well below their skill sets. Even those slim pickings are denied to the unemployed…”

Wed, 06/08/2011 - 23:24 | 1353540 dxj
dxj's picture

Why would Helicopter Ben be worried when he can simply print more jobs?

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