Bank of Japan
What do you do when you're a government statistician and the economic data doesn't say what you want it to say? Why you "adjust" it of course.
Global Stocks Tread Water After Two Consecutive Terrorist Scares; Oil Rises, Industrial Metals TumbleSubmitted by Tyler Durden on 11/18/2015 07:03 -0500
If this weekend's gruesome terrorist attack on Paris ended up being hugely bullish for stocks, then two subsequent events, a stadium-evacuation scare in Hannover (where Angela Merkel was supposed to be present) and a raid in north Paris which left several dead in the ongoing manhunt against the alleged ISIS mastermind, appear to have but some question into if not stocks then algos whether a rising wave of terrorist hatred across Europe is truly what central bankers need to unleash more QE. That said, we expect the current weakness to last only until the traditional USDJPY carry ramp pushes stocks traditionally higher.
"Japan’s experience suggests that QE has its limits, and could bring a range of side effects. These include years of tepid growth, the reduction in secondary trading liquidity, an increase in asset ownership by central banks (the BoJ now owns half of the national ETF market), potential formation of asset bubbles and social problems like inequality."
- Belgian Police 'Arrest' Public Enemy No.1 (Sky News)
- France Widens Crackdown at Home as Bombs Rain on Islamic State (BBG)
- Putin Goes From G-20 Pariah to Player at Obama Turkey Talk (BBG)
- Paris Attacks: 150 Raids as France Goes to 'War With Terrorism' (NBC)
- 'Rocket Launcher Found' In French Police Raids (Sky)
- Geopolitical worries lift oil after Paris attacks, but glut weighs (Reuters)
- Japan's economy falls back into recession again (BBC)
"It is already too late. Having delayed way beyond the point when it might typically have raised rates in previous cycles, it has allowed an Orc-like monster to incubate, hatch and emerge into the sunlight, snarling and ready to do battle."
Inflation expectations are collapsing in the EU, Japan and the US. Is another deflationary spiral about to hit?
Below is a "help wanted" ad for a "trader" by the infamous 3Red "spoofing" outfit. We put trader in quotation marks because... well, just read the ad and you will see.
The cries for going totally crazy are growing louder... the lunatics are running the asylum. One shouldn’t underestimate what they are capable of. The only consolation is that the day will come when the monetary cranks will be discredited again (for the umpteenth time). Thereafter it will presumably take a few decades before these ideas will rear their head again (like an especially sturdy weed, the idea that inflationism can promote prosperity seems nigh ineradicable in the long term – it always rises from the ashes again). The bad news is that many of us will probably still be around when the bill for these idiocies will be presented.
A Stunning Admission From A BOE Central Banker: This Is What The Coming "Helicopter Money" Will Look LikeSubmitted by Tyler Durden on 11/06/2015 13:51 -0500
“Consider for example a tax cut for households and businesses that is explicitly coupled with incremental Bank of Japan purchases of government debt – so that the tax cut is in effect financed by money creation”
- Ben Bernanke, Some Thoughts on Monetary Policy in Japan, 2003
“Inequality seems to be widening. A sales-tax hike and price increases last year hit households hard. Abe hasn’t succeeded to bring benefits to most ordinary people.”
Until recently, the consensus assumed a strengthening of the global economy in 2016. It won’t happen. If the global economic growth manages to reach 3.1% next year, as forecast by the IMF, it will be a miracle. We are close to the end of the current economic cycle. The outbreak of a new global crisis in the coming years is inevitable. The Fed and other central banks are in a dead-end having fallen in the same trap as the Bank of Japan. If they increase rates too much, they will precipitate another financial crisis. It is impossible to stop the accommodative monetary policy.
Following this morning's basic admission by Janet Yellen that "no matter what" The Fed is raising rates in December (which was then solemnly supported by an obedient Bill Dudley who "100% agrees with Yellen"), Fed Vice-Chair Stan Fischer, speaking tonight, reaffirmed this belief by, as we detailed previously, telling investors to ignore weak inflation. After San Fran Fed's Williams admission that "there's something going on here we don't understand," Fischer tonight admitted "US inflation is not as low as you think," at once contradicting Yellen's earlier comments and the various market-based measures, while confirming our previous detailed solving of the mystery of the hidden inflation.
You don’t actually have any savings. When you make a deposit, you’re trading your money for a banker’s promise to repay you. And there are countless regulations giving them the authority to break that promise. (If you want to test this premise, try withdrawing $25,000 just to see how your bank reacts.) That’s the system that controls your wealth today. It’s almost entirely digital. And it’s run by unelected bureaucrats whose interests are not aligned with your own. This is not a free system. And any rational person should consider parking at least a rainy day fund outside of this system.