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We’ll Never See Dow 10,000 Again – And Other “Good” Things
A guy I know for a long time calls up to bitch about my rants on
Bernanke and the QE. He is a 2&20 Walls Street “buy side” type.
He’s been at it for a long time. He says to me:
You don’t get it. Bernanke is giving you a once in a lifetime opportunity. He’s writing a put under the market. You’ll never see Dow 10,000 again. What the Fed is doing is a “good” thing.
This guy is coining money on the prospect of QE, he will probably rake
in more when it is a reality. We shall see if this all works out, but
one can’t argue the fact that from his perspective QE=Good. There are so
many things that we contemplate as being “good” when in fact they are
really not good. To me, saying,” QE is good” is like saying. “War is
good for the Economy”.
-It is Good when the US pursues a beggar my neighbor policy of trashing
the dollar. It is Bad when China manipulates its currency however.
-Laisse-Faire economics is Bad, Keynesian economics is Good.
-Price discovery is Bad, mark to model is Good.
-Balanced budgets and paygo are Bad, deficits are Good.
-ZIRP is Good for the economy, saving is Bad.
-A no downside risk equity market is Good. Bubbles however are very Bad.
-The Fed forcing inflation is Good. It would be Bad if prices were stable or went down.
-That QE and ZIRP undermine the dollar is good. When oil goes to $100 that would be Bad.
At the end of the day QE is going to raise the cost of living for every
American. We face the double hit of homegrown and imported inflation due
to the collapse of the dollar. The vast majority of Americans will be
poorer as a result. But some fat cats earning 2&20 will make a
bundle in a rigged market. QE will put the mother of all hurts on us at
some point in the future. But for now it is a Good thing. And therefore
we need more of it. And we’re certain to get it.
We need some leadership that cuts through the crap. It makes no sense
to follow a reckless and dangerous policy that has the objective of
enriching such a small portion of the population. The downside risks are
large. We are in completely uncharted waters with monetary policy. The
Fed is making a “Grand Experiment” with absolutely no consent from the people.
We can only hope that the next election brings a sea change of thinking.
That would appear to be unlikely. While it is now certain that the “Ins” will be “Out”
I don’t see a single voice in those who will step into leadership that
is apposed to QE. Until that happens Bernanke will continue to brush off
the warnings (from other Fed board members) and plod down a road that
he is espousing as Good, even though he knows full well that it is Bad.
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Woosie little bastards that can't spell, let alone conjure up a thought.
I'd dust off my old A2000 to personally catch the asteroid if I could see these bitchez swallow Dow 1000. BTW, didn't EWFF say Dow 400?
That's in 6-7 years. More important, the dow will be worth about 1 oz of gold again. Not a shocking prediction; it happened in 1980 and several times in the past.
The Dow will trade at 1oz again. Deflation = dow meets gold, inflation = gold meets dow (current scenario). Gold will only underperform stocks when the 'real' economy begins to improve. This will be the time to pile into stocks but is some years away.
Dow 1000 in the era of the ink jet is about as likely as Andrew Jackson rising from the grave to strangle the FOMC. Sure it might be fun to think about but it's not going to happen.
+1
where's Stonewall when we need him?
Got your Jacksons mixed up there.
thanks, never knew that!
http://en.wikipedia.org/wiki/Stonewall_jackson
Fiscal insanity rules the day. We reached the end of the universe, back to the Big Bang.
Looting the coffers before the collapse....
Good
= greatest number of people w/ sustainable incomes, sustainable lifestyles?
or
= greatest amount of debt retired?
i would like 5 lbs in one hundred bills and 2 pounds in 50s to go.
Or you could eat it here.
WAR IS PEACE, FREEDOM IS SLAVERY, and IGNORANCE IS STRENGTH.
and DEBT is MONEY...
and SAVING is SQUANDER.
and CENTRAL GOVERNMENTS GIVE 'RIGHTS'.
and the BEAR DOESN'T SHIT IN THE WOODS!
thought that was the pope?
We've always been at war with East Asia!
Came up somewhere else, not sure where but we should simply stop calling it QE and start calling it "QE/money printing". Any reference to it, always. Quantitative Easing almost sounds like a name for a new lounge chair. For god's sake, it's money printing. I think even your buddy, Bruce, might at least think harder about the stupdity of it all if you simply bludgeon him with money printing.
Bruce, ask him if he thinks counterfeiting is good or bad. Of course he'll tell you bad. Then ask him why it's bad. Then just shake your head and slowly repeat QE...money printing...counterfeiting...
Wait, wait, I have one....
Making an honest living is bad, making a living via counterfeiting is good.
There, we all can do it.
Would be better if you included who they print it for.
Oh, I like that - call it "money printing for the banks".
Sorry. It ain't about paper money, it's about STUFF.
Giving free money to the banks don't produce NOTHING. Stuff is produced by working people. So to produce Stuff you've got to give money to working people.
Money is a medium of exchange. It only has meaning if you have something to exchange. Without STUFF money has no meaning.
Of course none of the delusional assholes with the power to do something about this, stupid Bernanke, stupid Geithner, stupid Obama, all of stupid congress & all the stupid regulators have no clue.
What we really need to do is get TD some power.
They got their "stuff' and the power to keep it, so why should they give a damn.
We never saw Nasdaq 5000 again either.
They'll reverse split it when the AAPL bubble blows.
Remember. ipods replaced 8-track tapes.
iphones are cell phones
Ipads are notebooks
more than a few stocks trade better than 6x cash
..and Macs suck
Ipods replaced Walkmans
uh....I think CDs replaced 8-tracks......and I don't get your point anyway.
I do belive it was the cassette... Just sayin...
cassettes
Minidiscs
I should have said "ipods replaced those big black flat circles of plastic called records"?
I thought Ipods replaced walkmans and cds replaced cassette tapes.
hmmmm what is going to replace the iPod? AAPL tanked before with Herr Jobs at the helm. It could happen again.
Whose only saving grace was that they STILL sound so much better.
Bruce,
"solutions" which enrich the wealthy and indebted at the expense of impoverishing the middle and lower ranks of income...well I guess those in the top would see this as good from a very miopic viewpoint. Seems typical now and shows the degree to which our society has broken down. No longer any collective thinking...just dog eat dog, I win / you lose attitude. Unfortunately, I agree "good" is that which is sustainable and moves the entire entity along...I just don't see any powers that be interested in this kind of good.
That's what a pure fiat currency does to society.
Ghost, welcome back.. been wondering where you have been hiding. Always look forward to, and appreciate your insight.
Cheers,
Gub
...which can only exist with private centralized money planning (The Fed).
well, they are not going to vote themselves out of a job; so now what?
E-min's are red. Where would the bulls be w/o GOOG?
I smell a nasty open. If nothin else jest a fckoff kiss to the morning expiry calls.
VIX !!! VIX you lonely overlooked stalker.
Wall Street is Bad. It's negatives far outweigh its positives.
Why do we let this giant casino with the potential to destroy us all operate on top of our whole economy? What do we get out of this legalized system of gambling though leveraging other people's money to the tune of tens of trillions of dollars? What utility is this possible providing society?
How could any reasonable person defend it other than as a means to make a small subset of people very very rich?
¬ Wall Street is overpaid relative to the value they create.
¬ Capital markets where the risk is backstopped by taxpayers is criminal.
¬The FED manipulating and supporting bad assets very detrimental.
¬A healthy capital market system where taking risks are rewarded, savers/investors earn a decent return on capital, companies have a marketplace to raise funds for growth and bad investments are punished quickly without remorse......priceless!
I have a dream that the FED and the GuvMINT would be enabling and protecting the latter.
all a function of private centralized money planning (The Fed), fractional reserve lending, and fiat (faith-based paper) 'money'.
...it will probably only cause a World War (again).
bruuuuuuuuuuuuuuuuuuuuuuuce :D
So sad, and so true. At best, it will take years to get back to free markets and sane government.
edit
Time alone won't do it.
a good cry won't even do it.
Zimbabwe Ben is great if you are willing to bet that he will destroy America. But in the example above it's like being in the fire department and being happy that some crazed arsonist is burning down schools. Sure you get paid but it wears on people with a soul to deal with charred little bodies.