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SocGen's Albert Edwards Lowers Equity Allocation To Minimum On Fears "Fed Will Destroy The World"

Tyler Durden's picture





 

It has been a while since we heard from SocGen's uber-soothsayer Albert "Ice Age" Edwards. He is now back, and with quite a bang, reiterating a line from Marc Faber that will prove 100% accurate in a few short years. The French bank's forecaster, who has proven more accurate than most (and certainly far better than Wall Street's permabull-by-default brigade which is trotted out every day there is a market uptick and promptly tucked in when reality returns) just made the call to cut equity allocation to the lowest possible 30% (from 35%), while hiking cash from 15% to 20%. Deja vu? "the last time I reduced my equity weighting to 30% was 8 May 2008 when the S&P was stlll standing at 1400."

From Albert Edwards:

Lowering equity weighting to minimum - "The Fed will destroy the world”

 

In 2005 when Alan Greenspan was being hailed as a “maestro” I wrote that his policies would ruin the world and history would judge him to be “an economic war criminal”. I now think Ben Bernanke’s policies will prove even more ruinous than Sir Alan’s (yes unbelievably he still retains his honorary knighthood). Hence we are lowering our equity weighting to 30%, the minimum possible. The last time I did this was 8 May 2008.

  • I'm reading some insanely stupid stuff at the moment. Okay, I know some of my writing is pretty insane, but when I read direct quotes and commentary about Bernanke's policy of driving up asset prices in general and equity prices in particular, I almost want to cry over the ludicrousness of this position. The Fed is pursuing the same road to ruin as it did between 2003-2007. I'm becoming more and more convinced that, Gloom, Boom, & Doom's Marc Faber is right when he says that "the Fed will destroy the world" - link. (Also keep your eyes open for Dylan's next Popular Delusions.)
  • I agree with Philadelphia Fed President Charles Prosser, who dared to suggest the Emperor had no clothes by saying that QE, including the bank's purchase of $40bn a month of mortgage bond purchases, was unlikely to do much to boost growth and decrease unemployment.
  • Regular readers will know that in the main, my market timing is unerringly inaccurate, normally months if not years too early. But for those who might write off this move down to 30% as the yet more rantings of a lunatic, the last time I reduced my equity weighting to 30% was 8 May 2008 when the S&P was stlll standing at 1400.
 


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Thu, 09/27/2012 - 07:45 | Link to Comment Debtonation
Debtonation's picture

Good thing I've been stocking up on physical food lately.

Thu, 09/27/2012 - 08:00 | Link to Comment ratso
ratso's picture

Another load of BS from Bernanke bashing doom mongers.

Thu, 09/27/2012 - 08:04 | Link to Comment overmedicatedun...
overmedicatedundersexed's picture

sam nunn ex dem senator on cnbc:" compramise push back the cliff for six months so we can think more.."(not that it pushes it far from the nov election, no no it's for thinking).LOL

looking very good there Sam, very rich, very in the know, very reptile like. he's touted as a rational pol out to do good for our kids..LOL this MSM stinks 2 -3 minutes and i gotta just shut it off.

Thu, 09/27/2012 - 09:28 | Link to Comment Thomas
Thomas's picture

I picked a bad day to quit smoking crack.

Thu, 09/27/2012 - 09:59 | Link to Comment Stackers
Thu, 09/27/2012 - 08:09 | Link to Comment NewWorldOrange
NewWorldOrange's picture

"Another load of BS from Bernanke bashing doom mongers."

You must be absolutely blissful;)

Thu, 09/27/2012 - 08:11 | Link to Comment LongSoupLine
LongSoupLine's picture

fuck you ratso bank troll sacksuck

Thu, 09/27/2012 - 08:42 | Link to Comment JPM Hater001
JPM Hater001's picture

Take it easy.  He's doing the best he can with his limited intelligence.

Although a fuck you seems fair from time to time now that I think about it.

Thu, 09/27/2012 - 08:43 | Link to Comment MFLTucson
MFLTucson's picture

How about you fill us in on what Greenspan and Bernanke have done right??  If this is doom mongering then I have to assume you know something more that the rest of us, so we will all wait in anticipation of your wisdom!

 

Of course I will expect nothing from you because you are undoughtedly a fucking idiot to write something so stupid.

Thu, 09/27/2012 - 08:47 | Link to Comment EscapeKey
EscapeKey's picture

Yes, because all these GREEN SHOOTS in our STRONG RECOVERY which Bernanke, Geithner and Nobama promised us have all turned out exactly as your kind told us it would, and the Gini coefficient is on a stong rebound in favour of the middle class.

Your clueless level = Keynesian economics student.

Thu, 09/27/2012 - 10:00 | Link to Comment exi1ed0ne
exi1ed0ne's picture

There was a time, not long ago, when having a few months of food on hand was normal.  Then, supply chains got better and more efficient, warehouses and huge supermarkets were built to ensure there was endless supply available for consumers.  Now things have gotten so efficient that we are doing real time allocation in the supply chain.  Why have a huge warehouse with capital lying on pallets?  Lets just order what we need plus a day or to in order to have Just In Time delivery.  Makes total business sense, but it also makes the supply chain very fragile.

Nowadays you have people conditioned to believe the shelves will always be full in the store, and have MAYBE a week of food on hand.  I hope for the sake of your family there is never a disruption (weather, earthquake, tornado, flood, outbreak, Canadian invasion) longer than your food stores.  Having a store of food, water and first aid supplies isn't just about the zombie apocalypse.  Heck, at least you'll eat for a while if you get laid off.

Thu, 09/27/2012 - 08:04 | Link to Comment zilverreiger
zilverreiger's picture

YOU CANT EAT FOOD

Thu, 09/27/2012 - 08:06 | Link to Comment saturn
saturn's picture

LoL

Thu, 09/27/2012 - 08:48 | Link to Comment EscapeKey
EscapeKey's picture

Don't they call McDonalds and KFC "food" - in which case I tend to agree with you.

Thu, 09/27/2012 - 08:08 | Link to Comment stocktivity
stocktivity's picture

Chuck Shumer (Democrat) told the Bernanke to "get to work".  Romney (Republican) has already said he would fire Benny. Obama (Democrat) will keep him.  Benny just went all in.  HELLLLLOOOOO!!!! What part don't people understand???

Thu, 09/27/2012 - 08:50 | Link to Comment EscapeKey
EscapeKey's picture

Ooh yeah I can't wait for Obamney's Bernanke replacement who will do more of the same.

http://www.sott.net/image/image/s5/104959/full/obamitt1.jpg

Thu, 09/27/2012 - 09:38 | Link to Comment ATM
ATM's picture

insuider info is Romney would pick John Taylor - Stanford. He of the Taylor Rule.

Thu, 09/27/2012 - 10:10 | Link to Comment metastar
metastar's picture

Its a small head for such a big suit.

Thu, 09/27/2012 - 07:45 | Link to Comment vinayjha
vinayjha's picture

I wished fed could simply deposit the money to people account rather then increase their balance sheet by trillion of dollar. Everyone could have easily got $50k by now  http://www.freefdawatchlist.com/2012/09/stock-market-expected-to-open-higher_26.html

Thu, 09/27/2012 - 08:08 | Link to Comment Urban Redneck
Urban Redneck's picture

If everyone received 50,000 sea shells with which to trade, why would someone be willing to exhange real goods or services for more worthless sea shells... Even the retarded Krugmanites will concede inflation would occur under such circumstances, as every seller would demand more sea shells for the same quantity of guns & butter or bread & circus.  

Thu, 09/27/2012 - 08:10 | Link to Comment Antifaschistische
Antifaschistische's picture

Vinay! Your suggestion of distribution would benefit the 99.9% which means it will never happen....while POTUS pretends to believe in redistribution of wealth, its only as a kickback from the .1% who are enriched by current policy. tHATS how the mob works, thats how the DC/NY machine works

Thu, 09/27/2012 - 08:41 | Link to Comment Beam Me Up Scotty
Beam Me Up Scotty's picture

Except it won't benefit the 99% either.  You think gas will stay at $4 a gallon if everyone got $50k?  Why not make everyone a millionaire?  Then you can buy your $10,000 loaf of bread.  Its called INFLATION moron.

I know, you thought inflation was what happened when you looked at the lingerie section of the Sears catalog.

Thu, 09/27/2012 - 08:14 | Link to Comment LongSoupLine
LongSoupLine's picture

 

 

vinay, that would suggest the Fed exists to support the people and not banks.  This simply is not the reality.

Thu, 09/27/2012 - 09:09 | Link to Comment KidHorn
KidHorn's picture

Finally, someone understands that the FEDs job is to support banks. The FED works for the banks, not the people. It's not even part of the US government.

There are way too many morons who post comments like 'The FED is bailing out the banks' as if it's some secret plan. They're supposed to bail out the banks. It's what they do.

Thu, 09/27/2012 - 07:53 | Link to Comment GetZeeGold
GetZeeGold's picture

 

 

"Fed Will Destroy The World"

 

Use it and abuse it.....rinse and repeat. Play with it...but don't kill it.

 

Thu, 09/27/2012 - 07:55 | Link to Comment pamriallc
pamriallc's picture

"fondle the cube"

Thu, 09/27/2012 - 07:58 | Link to Comment GetZeeGold
GetZeeGold's picture

 

 

Be careful with that....we've only got the one.

 

Thu, 09/27/2012 - 10:33 | Link to Comment franzpick
franzpick's picture

It'll work better if you add a little tonguesten.

Thu, 09/27/2012 - 07:45 | Link to Comment Meesohaawnee
Meesohaawnee's picture

the 64k question is.. does the fed care? survey says....

Thu, 09/27/2012 - 08:12 | Link to Comment trebuchet
trebuchet's picture

.... the fed? who's that??

Thu, 09/27/2012 - 08:15 | Link to Comment LongSoupLine
LongSoupLine's picture

It's now the 64B question...inflation. (note: do not refer to CPI)

Thu, 09/27/2012 - 08:41 | Link to Comment CrimsonAvenger
CrimsonAvenger's picture

oh, they care - they care lots. Just not about the same stuff you do. Your interests and theirs are not the same.

Thu, 09/27/2012 - 07:46 | Link to Comment crito
crito's picture

money aint got no owners, only spenders...

Thu, 09/27/2012 - 07:55 | Link to Comment GetZeeGold
GetZeeGold's picture

 

 

I hope the Printers have Secret Service protection.

 

Thu, 09/27/2012 - 08:17 | Link to Comment LongSoupLine
LongSoupLine's picture

only if the printers have hooker access...

Thu, 09/27/2012 - 07:47 | Link to Comment becky quick and...
becky quick and her beautiful mouth's picture

need to buy more propane tanks...looks like it will be cold at the end of the world this year.

Thu, 09/27/2012 - 10:42 | Link to Comment franzpick
franzpick's picture

Don't forget the propane electric generators.

Thu, 09/27/2012 - 07:48 | Link to Comment Ralph Spoilsport
Ralph Spoilsport's picture

We're on the same road to ruin because it worked so well last time. They have had the same map for a while and this "road to ruin" is clearly marked (except on the new iPhone Map App).

Thu, 09/27/2012 - 08:08 | Link to Comment Mister Ponzi
Mister Ponzi's picture

The quality of their maps is infamous - at least so the official story goes:

http://en.wikipedia.org/wiki/U.S._bombing_of_the_Chinese_embassy_in_Belgrade

 

Thu, 09/27/2012 - 08:23 | Link to Comment Urban Redneck
Urban Redneck's picture

Lets see-  the AF loses an F-117 stealth fighter over Yugoslavia, and 41 days later the CIA "accidentally" bombs the local HQ of the largest industrial espionage shop in town...

Thu, 09/27/2012 - 09:00 | Link to Comment XitSam
XitSam's picture

Everyone assumes that an American was flying that F-117. Hmm. Haven't thought about that rumor in quite a while.

Thu, 09/27/2012 - 07:48 | Link to Comment NaiLib
NaiLib's picture

SocGen is one of the three IndexWatchDogs in Europe, Making sure there is no real pricing of the indices. As soon as volume is down a bit, they come in with full force driving up the indices seamingly with the only wish to pay as much as possible...

Thu, 09/27/2012 - 07:52 | Link to Comment orca
orca's picture

If he is (correctly) assuming the FED is destroying the world, why is he at 70% cash? Were he to tell his investors that he returns the money and they are to buy physical stuff with it I would get it, but what I understand from his rant is that he plans to let all that money gather dust while hyperinflation is about to kick in.
What is left of my non-physical net worth is 130% in stock, for that very reason.

Thu, 09/27/2012 - 08:41 | Link to Comment NewWorldOrange
NewWorldOrange's picture

I think he was speaking for the allocation of SocGen's accounts, not his own personal account. And it sounds like that 30% minimum (which he states twice is the minimum allowable) is mandated either by the corporate charter or in contracts with account holders, or perhaps even by the laws in Europe. Tylers?

Thu, 09/27/2012 - 07:52 | Link to Comment Landotfree
Landotfree's picture

The fed isn't going to destroy the world, all you lemmings are and the generations before you who wish to engage in a ponzi scheme.  ZH is apparently made up unfunded liabilities that do not wish to be liquidated, unfortunately or fortunately there is only one outcome from using the equation.... liquidation of the unfunded liabilities.

Blaming the Fed is for this is like blaming the Fed for the Sun rising in the East this morning.  There is nothing the Fed can do to stop the collapse.  Sorry.

Thu, 09/27/2012 - 07:55 | Link to Comment bigbwana
bigbwana's picture

You sound like Illuminati spawn.

Thu, 09/27/2012 - 07:58 | Link to Comment Landotfree
Landotfree's picture

No, I sound like somone that knows 8th grade Math.  Sorry, someone is going to have to go, matter of fact quite a few are going to have to go this time.

 

"The Oracle: Seems like every time we meet I've got nothing but bad news. I'm sorry about that, I surely am. But for what it's worth, you've made a believer out of me. Good luck, kiddo." - The Matrix Reloaded

Thu, 09/27/2012 - 08:03 | Link to Comment GetZeeGold
GetZeeGold's picture

 

 

 

No, I sound like somone that knows 8th grade Math

 

You'll learn Algebra in the 9th grade.....it will totally change your perspective.

 

Thu, 09/27/2012 - 08:13 | Link to Comment NewWorldOrange
NewWorldOrange's picture

Perfect. Laughed out loud

Thu, 09/27/2012 - 08:04 | Link to Comment bigbwana
bigbwana's picture

The Fed IS owned by the Illuminati. JFK knew it and tried to stop them, They assasinated him. Evil. Evil. Evil.

Thu, 09/27/2012 - 08:07 | Link to Comment Landotfree
Landotfree's picture

Irreleant, the system will collapse and it does not matter if there is or is not a Fed and whether or not it's owned by the Illuminati or Mickey Mouse.

Thu, 09/27/2012 - 08:11 | Link to Comment bigbwana
bigbwana's picture

Of course it matters! The Illuminati are also poisoning our skies with chemtrails.

Thu, 09/27/2012 - 08:11 | Link to Comment Bay of Pigs
Bay of Pigs's picture

Irreleant? Your spelling is as good as your math. LOL.

Your knowlegde on the FED is sorely lacking as well.

Thu, 09/27/2012 - 08:18 | Link to Comment Landotfree
Landotfree's picture

You are just an unfunded liabilities that is scared of being liquidated, so instead you are looking for someone blame.  

Sorry buddy, nothing the Fed can do once max potential has been hit.   

 

"knowlegde"  LOL

Thu, 09/27/2012 - 08:22 | Link to Comment Bay of Pigs
Bay of Pigs's picture

You saw what I did there?

I guess you are paying attention.

Thu, 09/27/2012 - 09:11 | Link to Comment hapless
hapless's picture

Memo to Self:  If the Fed offers me a ride in open convertible, DON'T ACCEPT IT.

Thu, 09/27/2012 - 08:00 | Link to Comment pamriallc
pamriallc's picture

absolutely agree with you.  the epic battle is between "fiscal policy" and "monetary policy" where the drug addicted patient is going through DT's and needs to be on morphine in order to not die in the process of becoming healthy.  the FED in this case is nothing more than a doctor doing all they can due to a sick patient and the doctor has few remedies.  the patient in this case as per "fiscal policy" continues to abuse their privledge and the FED is forced to produce their own version of stability/medicine under the current system.  remove the FED and voila! we now have a direct-connect between politics and federal spendng with zero buffer.  PERFECT.  politicians....you're now on your own and must take personal responsibility.  free lunch.....all gone.

Thu, 09/27/2012 - 08:04 | Link to Comment Landotfree
Landotfree's picture

What is the Fed's purpose?

To prolong the coming collapse as long as possible.  The Fed's purpose has never been to stop the collapse as that is impossible.   Blaming the Fed serves no purpose, it's like blaming an ant on anthill for all their problems.

 

Thu, 09/27/2012 - 08:07 | Link to Comment overmedicatedun...
overmedicatedundersexed's picture

landot, the fed is to enrich the banksters and thier tools..please at least get that right. I should not but I will:

the fed is a tool to enable the elite to pick up cheap assets from the fools like you.

Thu, 09/27/2012 - 08:15 | Link to Comment Landotfree
Landotfree's picture

Those assets would be hell of alot cheaper if not for the Fed.  Of course, I am in no way saying what the Fed is or isn't doing is going to help you.   

There simple is no way for the Fed to stop the collapse, their job is simple, prolong as much as possible.

The top always takes from the bottom, as you are typing on this board, I would suspect you are closer to the top then the bottom.   We all must look in the mirror.

Saying this or that about the Fed does not address the problem.

Thu, 09/27/2012 - 08:34 | Link to Comment GetZeeGold
GetZeeGold's picture

 

 

I remember being a freshmen in college taking Econ 101.

 

Do they still serve that green jello crap in the cafeteria?

 

Thu, 09/27/2012 - 08:39 | Link to Comment Cosimo de Medici
Cosimo de Medici's picture

You ought to explain your argument, though I suspect you are having fun sticking it to the loons.  Introduce yourself.  Those of us who have been reading ZH since Day One know you and your argument, but the addled set suspects you of shilling for Bernanke.  How wrong they are.  Since yours is the Doomiest and Gloomiest opinion ever voiced in Zerohedge Comment history, bar none, all those now panning you would stand up and applaud if they understood your argument, especially those who think they'll survive your predicted culling of the "unfunded liabilities" (beautiful term, by the way).  Please, "LandotFree" (ahem), take them out of their misery.  Put the equation up there.

Thu, 09/27/2012 - 08:49 | Link to Comment Landotfree
Landotfree's picture

Use any interest rate equation you want... simple, compounded, etc.  Unsustainable long term, requires unlimited power.   Go look a graph of compound interest, that is the root of the system.   Generation after generation continue to want to lend/borrow at a rate of interest, the equation is unsustainable long-term or even medium term... usually around a generation then collapse.   

There really isn't much too it, certainly nothing the Fed can do about it.   The system will start, the system will rise, the system will be unable to continue to rise (peak), the system will decline and collapse.... then liquidation of the unfunded liabilities.   100+ million last time, my guess 1-3 billion this time.   

Thu, 09/27/2012 - 09:26 | Link to Comment IndicaTive
IndicaTive's picture

Pandemic. Nukes. 

Thu, 09/27/2012 - 09:52 | Link to Comment Liquid Courage
Liquid Courage's picture

Or Jubilee ... if you could enforce it, which you can't because Man's Laws are for sale to the highest bidder.

My, my ... what a conundrum.

Thu, 09/27/2012 - 10:48 | Link to Comment franzpick
franzpick's picture

The journey of a 1000 miles starts with one step, from the USPS ForEver Stamps, to Benny's ForEver Bonds.  Uncle Sam Wants You again.

Thu, 09/27/2012 - 09:28 | Link to Comment kridkrid
kridkrid's picture

So a question for you 13-1-11-15... After the collapse, what then? If you were to start over with a form of exchange that doesn't have interest tied to it, no reason to have to cycle through it all over again, is there? Of course that assumes there is something left from which to start over.

Thu, 09/27/2012 - 10:25 | Link to Comment Greater Fool
Greater Fool's picture

Thank you, Mr. Malthus.

Thu, 09/27/2012 - 10:35 | Link to Comment Overfed
Overfed's picture

The proper term used by the 'elite' is useless eater.

Thu, 09/27/2012 - 08:33 | Link to Comment Pegasus Muse
Pegasus Muse's picture

Equating the Fed to a doctor ignores the reality the Fed created today's disastrous economic circumstances by addicting a body politic and people to Easy Money.  The Fed is a fiat money Pusher Man. 

http://www.youtube.com/watch?v=3XqyGoE2Q4Y 

Thu, 09/27/2012 - 08:50 | Link to Comment Landotfree
Landotfree's picture

Irrelevant.  The Fed could stop everything they are doing to day, instant collapse, they could have been dissolved 20 years ago, eventually the system would collapse.   The Fed could have not been formed in 1913 and the system would have still collapsed.   

Thu, 09/27/2012 - 09:44 | Link to Comment JimBowie1958
JimBowie1958's picture

The rise and collapse of markets is a natural cycle. The problem is that for the last 80 years or so we have artificially muffled corrections or collapses by spreading the consequences of inefficient businesses and bad investments around to everyone, thus allowing too many of these bad players to continue to participate in the markets when they should not have.

So we have been kicking the can down the road in one form or another until now we have the entire Treasury of the US and the developed world trying to backstop an exponentially growing global financial debt that now NO ONE can pay off.

So it will be one HUGE collapse or correction, and then new technologies will create new opportunities for investment and we will recover as WE ALWAYS HAVE EVENTUALY.

Cheer up; it's only half as bad as you think as we will carry on one way or another.

Money properly understood is a store of labor and resources. Nothing more. The labor and resources will not just disappear, so real wealth will not end or disappear either. It will simply re-emerge in another form or format. Probably Thorium commodity based currency that also represents an energy storage of value, lol.

Thu, 09/27/2012 - 10:49 | Link to Comment Pegasus Muse
Pegasus Muse's picture

The most vibrant and dynamic periods of economic growth in America -- periods in which the working class generally improved their lot -- were those in which the parasitic central banksters and their european masters were given the boot.

If men of character and backbone -- guys like Andrew Jackson -- can muster the resources to again exterminate the Central Bank and put an end to (or place tight control over) Fractional Reserve Lending we will regain prosperity.  It is a matter of purging the parasitic vermin from our economic system so the nation can heal itself. 

This is all laid out clearly in The Money Masters: http://www.youtube.com/watch?v=H56FUHgqRNE 

 

Congressman McFadden understood the bankster scam:

“We have in this country one of the most corrupt institutions the world has even known.  I refer to the Federal Reserve Board … This evil institution has impoverished … the People of the United States …. And has practically bankrupted our Government. It has done this through …. The corrupt practices of the Moneyed Vultures who control it.”

Louis T. McFadden

Remarks in Congress, 1934

http://www.afn.org/~govern/mcfadden.html  

Thu, 09/27/2012 - 08:04 | Link to Comment Dr. Engali
Dr. Engali's picture

You forgot your sarc tag... But your bold typing is nice.
The fed and their ZIRP policy is the problem. If we had a free floating market rate the government could never spend what they are now. And there is no way we should be paying interest to print our own money.

Thu, 09/27/2012 - 08:16 | Link to Comment NewWorldOrange
NewWorldOrange's picture

Don't confuse the 8th grader with facts.

Thu, 09/27/2012 - 09:16 | Link to Comment hapless
hapless's picture

Guns don't kill people - it's the fuckin' bullets.

Thu, 09/27/2012 - 12:54 | Link to Comment JimBowie1958
JimBowie1958's picture

The fed and their ZIRP policy is the problem. If we had a free floating market rate the government could never spend what they are now.

That is the ideal solution, but these theives have stolen so much money and built our national debt so high that the only thing keeping the interst payments on the debt manageable is ZIRP.

What is a pratical and plausible solution that does not require the complete devaluation of the USD to trash on one hand or bankruptcy of the US on the other?

I dont see it.

Thu, 09/27/2012 - 08:05 | Link to Comment zilverreiger
zilverreiger's picture

I agree , but they sure as hell shouldnt worsen the collapse!!!

Thu, 09/27/2012 - 08:10 | Link to Comment Landotfree
Landotfree's picture

The system is based on the idea of convincing the lemmings that the system is sustainable.  How do I know the lemmings believe the system is sustainable... as the system would instantly collapse as soon as the didn't believe.   The Fed is not worsening the collapse, they are doing their purpose which the lemmings have programmed them to do.   

I figure 1-3 billion unfunded liabilities will have to go this time, only 100+ million went last time.

Thu, 09/27/2012 - 08:12 | Link to Comment overmedicatedun...
overmedicatedundersexed's picture

too may words to say nothing why waste your time here Landot? what the heck the fed is programmed by the lemmings?? off your meds is my best guess.

Thu, 09/27/2012 - 08:19 | Link to Comment Landotfree
Landotfree's picture

Yeah, I am nuts because I know the Fed does not have unlimited power.   Sorry I don't worship your God.... I know, I know... the helicopters are coming to save you.

Thu, 09/27/2012 - 08:35 | Link to Comment NewWorldOrange
NewWorldOrange's picture

Their power to destroy the currency (and hence pretty much everything else) is essentially unlimited. See, it's like this:

Prices are proportional to the quantity of money divided by the quantity of all goods and services. Since you like to describe it as (merely) "simple 8th grade math", let me phrase it in another way.

Let P = the general price level

Let M = the quantity of money

Let G = the quantity of goods and services

Let a = a constant

Then P = aM/G

Understand now? If not, don't give up. Like GetZeeGold said above, you'll get to algebra in the 9th grade.

Thu, 09/27/2012 - 08:44 | Link to Comment Landotfree
Landotfree's picture

Irrelevant.   Attach interest to your medium of exchange, you'll be lucky to get a generation or so use out of it before the need for exponential growth blows it up.

Well, I am out of here for today.   You guys have fun discussing how the helicopters are coming to save everyone.   I will sit back and laugh during the liquidation.

 

Thu, 09/27/2012 - 09:02 | Link to Comment NewWorldOrange
NewWorldOrange's picture

I think I'm beginning to understand. LandotFree is one of those people incapable of detecting sarcasm. He thinks (a lot of) ZH posters actually think helicopters can "save us." In fact, the opposite is true, as most all of us here know.

"Attach interest to your medium of exchange, you'll be lucky to get a generation or so use out of it before the need for exponential growth blows it up."

Exactly! If the Fed doesn't CNTRL-P, the interest the gov is paying on treasuries will soar...and of course exponential growth in the real economy is not possible to finance that via taxes. So the system will collapse...but the degree of the collapse will be infinitely worse than if we just take the hit now. People/markets are much more able to move on without a big black cloud hanging over them, and an economy can finally move on and grow once all its malinvestment is shaken out rather than propped up/bailed out.

You can subscribe to the "in the long run we're all dead" mindset if you wish, but the long run always comes, and Keynes's long run is already here.

Thu, 09/27/2012 - 08:19 | Link to Comment bigbwana
bigbwana's picture

landotfree, you are most assuredly the spawn of the Illuminati.

Thu, 09/27/2012 - 08:25 | Link to Comment Landotfree
Landotfree's picture

I have no idea what that is suppose to mean.  You apparently don't know basic Math and wish to blame me for your problems or problems in the near future.

If you are lucky, you never know, maybe you can escape liquidation.   If nukes are used, well, good luck with that and all.  If nukes are used, my estimate of 1-3 billion goes to 6-7 billion unfunded liabilities being liquidated.  Either way someone is going to have to go.

Thu, 09/27/2012 - 09:09 | Link to Comment XitSam
XitSam's picture

Extra shot of 5 hour energy in your double espresso this morning?

Thu, 09/27/2012 - 08:28 | Link to Comment NewWorldOrange
NewWorldOrange's picture

"The Fed is not worsening the collapse, they are doing their purpose which the lemmings have programmed them to do."

Sophistry. They are prolonging the collapse, which is already underway. It's not an event, it's a process. And they're greatly "worsening" the effects of that process. Sheesh...is language really this hard for you? Shilling for Ben? Ben Dover?

Thu, 09/27/2012 - 08:32 | Link to Comment Landotfree
Landotfree's picture

The Fed is just a program, the system has generated the Fed.  You are a lemming.   The lemmings are all connected to the system.  I am a lemming who stopped marching and certainly knows the Fed or whoever else you want to blame is not the blame.  The lemmings are.  

"(if by "lemmings" you mean the out-of-control politicos who created the creature at Jekyl Island."

None of this is possible without the lemmings, that is the 7 billion people walking this floating rock.  

Thu, 09/27/2012 - 08:38 | Link to Comment Bay of Pigs
Bay of Pigs's picture

WTF are you babbling about? Haha...

Thu, 09/27/2012 - 08:49 | Link to Comment NewWorldOrange
NewWorldOrange's picture

LandotFree, that is some of the most simple-minded sophistry I've ever heard.Allow me to paraphrase:

"MF Global is just a business, the system has generated MF Global...None of what MF Global did was possible without it's lemming customers."

If you prefer to cast blame on the victims, go for it. I would have thought you had learned the absurdity of that by the 8th grade. Heh.

Thu, 09/27/2012 - 08:53 | Link to Comment Landotfree
Landotfree's picture

"If you prefer to cast blame on the victims"

Investing in a known ponzi scheme is not a victim.   Either way the unfunded liabilities will have to be liquidated whether they know or don't know.   

Zion was destroyed 5 times previously, so what?

Thu, 09/27/2012 - 08:57 | Link to Comment EscapeKey
EscapeKey's picture

It is, when the alternative is going to prison.

Thu, 09/27/2012 - 12:25 | Link to Comment Pareto
Pareto's picture

What...........in the fuck..........are you talking about?

Fri, 09/28/2012 - 09:57 | Link to Comment Boozer
Boozer's picture

Lando -

Please be so kind and return to the yahoo finance blogs.

Thu, 09/27/2012 - 08:22 | Link to Comment Pumpkin
Pumpkin's picture

Apparently you have a cause and effect problem.  Hell, just read the mandate (yeah go ahead and pretends it is real) and judge the fed by that.  The lies don't support the lies.

Thu, 09/27/2012 - 08:54 | Link to Comment Landotfree
Landotfree's picture

Of course not, that is why 7 billion people are running from the Truth.  7 billion people are ignoring the obvious, why?  Instant collapse and liquidation of the unfunded liabilities.

Thu, 09/27/2012 - 08:37 | Link to Comment yogibear
yogibear's picture

Ah, a bankster or his lap dog has shown up. Banksters get viscous when you attempt to reveal their schemes.

Like cornered rats. 

Thu, 09/27/2012 - 07:54 | Link to Comment bigbwana
bigbwana's picture

Why does the Fed continously adopt policies that everybody knows are destroying the global economy? Because they are owned by the Illuminati and, in their evil quest for a NWO, it is but one tactic. Their evil tyranny will soon be over.

Thu, 09/27/2012 - 08:12 | Link to Comment Landotfree
Landotfree's picture

"Why does the Fed continously adopt policies that everybody knows are destroying the global economy?"

Sorry buddy, your ATM card would have stopped years ago if not for the Fed.   Of course, one day your ATM card will stop working anyway as the Fed does not have unlimited power to hold off the collapse.  The unfunded liabilities will have to be liquidated.

Thu, 09/27/2012 - 08:29 | Link to Comment bigbwana
bigbwana's picture

The Fed has been printing your money, and lending it to your government and charging  interest! That is the reason for debt. The Fed should be abolished. They soon will.

Thu, 09/27/2012 - 08:36 | Link to Comment Landotfree
Landotfree's picture

It's not my money nor my government.   Sorry.

You can get rid of the Fed, instant collapse.   These systems have been collapsing the same way before there were things called banks or central banks.  

Thu, 09/27/2012 - 08:30 | Link to Comment LongSoupLine
LongSoupLine's picture

you're about as trolltarded as I've seem....is this Steve Liesman?

Thu, 09/27/2012 - 08:35 | Link to Comment Landotfree
Landotfree's picture

Sorry buddy, I do not worship the same God as you and Stevie.... Stevie believes the Fed has unlimited power to, he believes the helicopters are coming to save.   Sorry but you apparently haven't read a word I have written.

Fri, 09/28/2012 - 12:18 | Link to Comment andrewp111
andrewp111's picture

When all you have is a hammer, everything looks like a nail.

Thu, 09/27/2012 - 07:57 | Link to Comment lolmao500
lolmao500's picture

Short gold, silver, long ammo and food.

Thu, 09/27/2012 - 08:03 | Link to Comment Quinvarius
Quinvarius's picture

Wait for gold to get back to the mid 1900's before you think about putting on a short term short trade.  This is way too early to be looking for a trade there.  Silver is not to be messed with on the short side by retail ever.

Thu, 09/27/2012 - 07:57 | Link to Comment Quinvarius
Quinvarius's picture

Meh.  Going higher.  Stop seeing every problem as a problem.  See every problem as an excuse to print money.  They are not letting the banking system go down.  And that means they have to print trillions.

Thu, 09/27/2012 - 08:35 | Link to Comment Landotfree
Landotfree's picture

Sorry, nobody has the unlimited power you would need to stop the collapsing of the system.  The equation always wins.

Thu, 09/27/2012 - 09:51 | Link to Comment samcontrol
samcontrol's picture

your 1 to 3 billon equation is fucking pathetic.

Thu, 09/27/2012 - 09:51 | Link to Comment samcontrol
samcontrol's picture

your 1 to 3 billon equation is fucking pathetic.

Thu, 09/27/2012 - 07:59 | Link to Comment overmedicatedun...
overmedicatedundersexed's picture

pork belly.. buy, the bottem is in..duke and duke.. has spoken.

Thu, 09/27/2012 - 08:01 | Link to Comment orangegeek
orangegeek's picture

Not a fan of the Fed, but this nimrod from SocGen.  That's just too much. 

 

Socialist France is out of rope and so the blame game continues.

 

France can join the PIIGS - now rebranded as IFPIGS

Thu, 09/27/2012 - 11:52 | Link to Comment supafuckinmingster
supafuckinmingster's picture

orangegeek: "France can join the PIIGS - now rebranded as IFPIGS"

 

I think SPIFIG works better myself.

Thu, 09/27/2012 - 18:47 | Link to Comment Shigure
Shigure's picture

Now include the UK and Netherlands in the mix...

Thu, 09/27/2012 - 08:01 | Link to Comment booboo
booboo's picture

The Federal Reserve, by buying up all of the toxic mortgage paper the market sold to the rubes along with other legislation making it's way through congress will allow foriegn and American investor groups to buy large blocks of homes through government channels.

Ben thinks just the right amount of wage deflation and asset inflation is the cure as long as he and his ilk do not have to experience this lifestyle. Again, he will lose control as the middle shrinks after being consumed by the burning wicks at each end of this candle. 

Welcome to Pottersville on a grand scale.

 

Thu, 09/27/2012 - 08:13 | Link to Comment rsnoble
rsnoble's picture

What??? But futures are up this am! China recovered again overnight! Buy! Buy! Buy!  

LMAO. This entire planet needs a circus tent drapped over it.

Thu, 09/27/2012 - 08:16 | Link to Comment proLiberty
proLiberty's picture

In my opinion, it is not just the Fed, but all the major central banks because all their executives and officials had the same professors at the London School of Economics and all pal around with each other at the Davos and Jackson Hole confabs.  They all are following the same script and all talk with each other on a daily basis.  

 

We are preparing for the failure of fiat money in general, even though when it happens the world will blame the US and its Federal Reserve Corporation.

Thu, 09/27/2012 - 08:48 | Link to Comment oldschool
oldschool's picture

Is it really the destruction of fiat that is being prepared, or just of this (national, mostly) fiat system -- to be replaced by a new and improved international fiat?

Thu, 09/27/2012 - 08:20 | Link to Comment LawsofPhysics
LawsofPhysics's picture

Had the savers and responsible behavior been rewarded and had there been real consequences for bad behavior at all levels of society we wouldn't find ourselves in this mess to begin with.  Where the fuck is John Corzine?

Nothing changes until the issue of moral hazard is addressed.  My guess is that ultimately supply lines will start breaking down long before this happens, then people start dying in some significant numbers.  Know history, same as it ever was.  Apparently humans are no smarter than yeast after all. 

Thu, 09/27/2012 - 08:36 | Link to Comment Bicycle Repairman
Bicycle Repairman's picture

Have to agree about "responsible behavior" and society.  I just wonder if "responsible behavior" will be enough to save one's skin going forward.  It's clear the rules have changed.

Thu, 09/27/2012 - 08:23 | Link to Comment el-greco
el-greco's picture

And of course they know full well they are in the process of destroying the world. There is no possible resolution to the US debt that the government is willing to face by itself, so bringing down the rest of the world together with them is the only chance they have to preserve supremacy. Ditto the very clear sign that they are looking to start a war, anywhere and with anyone...it doesnt matter to them.

Thu, 09/27/2012 - 08:22 | Link to Comment mrktwtch2
mrktwtch2's picture

y boys we are not going to see spx 600 again..the fed learend how to keep the market up form 2009 on..we all know that the fundamentals dont justify thiese levels but you will go broke fighting it..short of europe totally imploding (which will happen but god know when.)..the march to spx 1600 continues..good luck..

Thu, 09/27/2012 - 08:39 | Link to Comment Bicycle Repairman
Bicycle Repairman's picture

Can the FED buy the entire stock market?  If so, then the stock market will be at whatever level the FED wants.  Fundamentals would mean nothing.

Thu, 09/27/2012 - 12:20 | Link to Comment Pareto
Pareto's picture

Agree.  Don't fight the FED, regardless of how fucked up it is.  One caveat, however.  Transports flirting with the June low.  If broken, then this will call out the usefulness of a  "Don't fight the FED" axiom, when all the wildebeasts are stampeding the exits.  That said, I think you would also need to see a serious break in the $USD - the kind of break that signals a loss of confidence in Larry (the nut job) Kudlow's king dollarama.....IMO.

Thu, 09/27/2012 - 08:37 | Link to Comment YHC-FTSE
YHC-FTSE's picture

He really ought to go a bit further and state that the Fed has already destroyed the world. The water is already hot enough to kill those around the edges, yet the rest of the frogs are just sitting there waiting for someone to miraculously turn off the heat and basking in the non-stop bullshit of the markets. Unfortunately there's enough tinder and fuel in terms of the $600 Trillion+ worth of derivatives to ensure that we're all going to be burnt to a crisp, unless you hop the fuck out now and stop participating in the illusion of safety in government platitudes. Buy physicals. Grow food. Secure your home. 

I've considered it carefully and with some reservations I think we're already in the throes of a major systemic collapse. A collapse that tptb are desperately trying to hide in another big war. The Fed may indeed have the best datasets available on the planet, but they are constantly reacting to one disaster after another of their own making instead of converting that raw data to information and knowledge for the general public, as individuals are doing already on ZH and other places. The ultimate wisdom in all of this may be to do nothing: To allow insolvent institutions to collapse however big they are, to allow off-book liabilities to be visible, and allow price discoveries of assets, including currency. But they are neither wise nor honest - you can bet the government will pauperise every family on the planet before they will allow the squid institutions to collapse, or make the monopoly money they print at will worthless.

We still have a choice - trust in paper signed by criminals, or trust in yourself to do the right thing for the security of your family. 

Thu, 09/27/2012 - 09:10 | Link to Comment Levadiakos
Levadiakos's picture

Bullish

Thu, 09/27/2012 - 09:47 | Link to Comment Arnold Ziffel
Arnold Ziffel's picture

"lowest possible" is not 30%.

Thu, 09/27/2012 - 10:08 | Link to Comment mktsrmanipulated
mktsrmanipulated's picture

The market has become the ultimate ponzi scheme promoted by dollar cost averaging....CNBC....IA's etc...last one holding the bag is going to be screwed

Thu, 09/27/2012 - 10:10 | Link to Comment rufusbird
rufusbird's picture

What is with all the hypervigelance this morning?

Thu, 09/27/2012 - 10:12 | Link to Comment Remington IV
Remington IV's picture

vote Ron Paul ... it's not too late

Thu, 09/27/2012 - 10:38 | Link to Comment El_Puerco
El_Puerco's picture

RON PAUL!...Hey!, where are you?....

 

:P

 

Thu, 09/27/2012 - 10:14 | Link to Comment mmanvil74
mmanvil74's picture

Anyone else puzzled as to why hoarding cash is the best prescription for too much money printing?

Thu, 09/27/2012 - 10:22 | Link to Comment silver surfer 2112
silver surfer 2112's picture

Because one hopes that opportunity will present itself before cash becomes worthless. Actually, money printing is being replaced by rehypothicated derivatives so anything "real" will be very valuable once they implode. Rumor has it that global currency collapse is the goal and that one gold backed currency will then be issued.

Thu, 09/27/2012 - 10:33 | Link to Comment El_Puerco
El_Puerco's picture

http://www.youtube.com/watch?v=cGCscOJDVKg&list=UUvsye7V9psc-APX6wV1twLg&index=10&feature=plcp

 

Do you REALLY want to know who someone is? ... The reason you came here is because your sick of it and you want to get to them, am I right?..

 

Saludos...

Thu, 09/27/2012 - 10:50 | Link to Comment slightlyskeptical
slightlyskeptical's picture

The FED can only destroy the current financial system, they can't destroy the world.  The labor pool and the neccesary resources will still exist. A new system will emerge which will be of greater benefit to mankind.

So basically Bernanke is doing the right thing by destroying the current financial system.

Thu, 09/27/2012 - 13:13 | Link to Comment sink critically
sink critically's picture

The problem isn't the printing of fiat currency, the problem is accepting it in trade for tangible goods and services. Stop the madness!

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