Winners and Losers Since QE3

Tyler Durden's picture

As we end the month and quarter, we remind ourselves that a massive amount of the recent 'strength' in risk markets occurred on just two days - ECB and Fed statements. Reflecting on the post-euphoria 'sell-the-news' or BTFD meme, we look at how various asset classes and securities have performed post-QEternity. Two lessons are clear: Front-Run The Fed's action (every time) and Buy Precious Metals.

Silver and Gold are the big winners from the 9/12 (pre-Bernanke) close - followed closely by the Long Bond. Oil and European stocks have lost notable ground and US equities are practically unchanged - having given up their post-QE3 pop...


While Treasuries did well, the real winner in bond-land was the MBS market - where current coupon 30Y yields plunged as every dealer warehoused (front-ran) the Fed's indiscriminate buying promise... (MBS -70bps vs -14bps in 10Y) - it seems the front-running of the Fed's action is a winning trade again and again...


but all the hope was for those valuation multiples to be maintained in equity land... how did sectors do? Not so great - Healthcare remains the clear winner as Staples hold unchanged (and the high-beta QE-sensitive sectors have been sold)


and those no-lose financials - that surely will benefit from QE3 right? - hhmm, not so much. MS and GS are dismal; BofA and Citi are down in line with the sector's 1.2% loss; with only JPM and WFC holding any gains...


Charts: Bloomberg

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crusty curmudgeon's picture

Wait, gold is not a bubble?

Precious's picture

Neutron Ben.  The buildings are still standing but the people are all gone.

Precious's picture

BofA lays off 15,000 people.

CEO declares, "We must become more efficient at laundering money from the Fed."

Anasteus's picture

:-)) this is by far the best explanation I've ever come across; thanks for posting it. Publishing economics textbooks in form of comic would certainly be worth considering.

aint no fortunate son's picture

Equity markets are gonna finish up today, no offense, its just good public policy you know

SmittyinLA's picture

actually the only thing left standing will be the debt, which will last decades longer than the buildings.  We don't make buildings or bill payers like we used to. 

Vincent Vega's picture

Winner's=banker's  Loser's=everybody else.

Meesohaawnee's picture

THAT is about the most accurate assessment. oh yea. traders who trade fundamentals..

WhiteNight123129's picture

The best trades are trades which either an investment and a speculation at the same time, like a refiner of minor metals with a large inventory trading below replacement cost of the of machinery at a very distress price of the minor metals, or also a situation which is both a savings and speculation at the same time, like Gold until recently was both a savings and speculation at the same time. Those are the best.

So if the fundamentals are good and you have enormous speculative upside on top of that, that is great. Financial assets are somewhat speculative with little fundamentals, given that Equity sits on top of the debt and debt to circulation (GDP) is very high, where are teh fundamentals???



bagehot99's picture

Agree with the sentiment, but the biggest losers in that post were punctuation and the English language.

“Rebellion to tyranny is obedience to God.”-ThomasJefferson's picture

What about the poor dumb slobs who rely on energy? I believe the members of OPEC merely raise the stakes when the crooks in Washington turn on the printing presses.

Alpo for Granny's picture

FYB!!! Pretty soon I won't even be able to afford these prime cuts in gravy

Hopium Dealer's picture

Just do what senior citizens do: turn to the robust flavoring of canned dog and cat food.


Edit: I just read your username. /facepalm on my part.

TrumpXVI's picture

I think it's time to pass some new (old) laws making begging legal for the elderly, the disabled and the insane......provided they possess the required begging license.  Perhaps bankers can be encouraged to contribute to almshouses, too (well, maybe that would be going a little bit too far).

Alpo for Granny's picture

That's okay Sonny I get a little absent-minded from time to time myself.

aheady's picture

Funny funny...

My recent fave is the ad instructing wives to pour a can of Chunky soup over some instant mashed potatoes for hubby's dinner tonight. Voilà! Stay one step above pet food!

Alpo for Granny's picture

Mmmm that sounds delicious young man Thanks for the recipe idea Well you should try a couple of sprinkles of old bay in chunky vegetable soup. Presto! Maryland crab soup!

aheady's picture

Nom nom... zesty idea, Gran!
Hey, I live in blue crab country and I can't afford to eat them : /

dbTX's picture

Additional thought; buy virtually anything they can't print.

savagegoose's picture

x2 = y2, same as x =y . golds value increase as the amount of fiat increases.  As bankers are the only ones with this new money, they shouldnt be buying it.

naughty bankers, stop buyin up the price

disabledvet's picture

Belly up to the Bar of Bullshit Boyz!

russwinter's picture

Will Markets go Overnight from Don't Fight the Fed to Pushing on a String?

lasvegaspersona's picture

The American people might not approve of the Fed if they realized that the Fed runs the economy the same way a referee calls a game.

The same way Green Bay lost last Sunday is the same way millions of Americans loose when the Fed 'makes the call'. It is not how you play the is who the Fed likes that matters.

TheSilverJournal's picture

The first rule is, don't fight the Fed.

If the Fed is intent on destroying the value of currency, then invest in assets that will benefit from hyperinflation.

insanelysane's picture


Just got 5 new credit cards, new student loan, and new home equity loan.  Add these all up and I are wealthy.

Dr. Engali's picture

Max them out by buying some PMs, guns and ammo then default. Well you can't default on the student loan but you can buy stuff. 

pods's picture

I have heard that crack is the must have item this year for those with student loans!


fuu's picture

Silver bitches!

mayhem_korner's picture



Ultimately, there will be no winners...just survivors.

hapless's picture

Survivors and the "unlucky".

Grand Supercycle's picture


Longs please be careful.

Due to recent central bank intervention and short covering spikes, these daily charts are extremely overextended and significant correction expected very soon:


RSBriggs's picture

I'm still not clicking your fucking link and driving traffic to your site, no matter HOW many times you spam this...

WhiteNight123129's picture

Well noted Grand Supercycle.

And yes USD strength will return agreed, it has to do with capital flows and contraction, little to do with PM dynamics itself or printing. Also if bonds continue to rally that is all contraction looking like, but that means the Fed continues to print (necessary response to contraction)... So no major really major correction for PM, maybe we go down to 1700...

What do you think? I am waiting for the handle to form on Gold....



BLOTTO's picture

Who are the loser's?


Oh just the MASSES of the world...

depression's picture



Anyone that needs food and energy to survive.

RopeADope's picture

The losers are all carbon-based life forms...


The winners are silicon-based (HFT), non-cellular (banksters) and extra-terrestrial lifeforms (Krugman)

El's picture

And in other news...

CFTC Orders JP Morgan Chase Bank, N.A. to Pay $600,000 Civil Monetary Penalty for Violating Cotton Futures Speculative Position Limits


Gee, $600,000, huh? That must really hurt. ::: rolls eyes :::

LMAOLORI's picture



They will find a way to pass that fine on to you.  Fines are like bribes they say pay up or you could end up facing real criminal prosecution. When Obama said 

"My administration is the only thing between you and the pitchforks." 

people took it wrong thinking he would actually prosecute them

 Obama apparently actually meant what he said at that White House meeting--his administration effectively would stand between Big Finance and anything like a severe accounting

NewWorldOrange's picture

"Two lessons are clear: Front-Run The Fed's action (every time) and Buy Precious Metals."

Yep -- every time. Every single time (in recent times.)

In the (awesome) video Tylers posted today of David Stockman speaking, Stockman explains that over the last 18 years, the S&P went from 400 to 1460, and that 85% of the gains came in the 24 hours preceeding FOMC meet ups. I just looked back over those events over the last few years, and it was every single time. And if there was a dip just before that (often the case), if you merely BTFD, waited a few days or so until after the FOMC meeting, and then got out until the next time, you'd be way up.

WhiteNight123129's picture

Gold is a bubble in formation, but why would the speculator miss a good old bubble?

As for bonds this is the bubble which has just popped, stay away.


insanelysane's picture

On one of the bottom marquees on bloomberg tv it says that Bernanke spent weeks lobbying his pals for QE to infinity.  Wonder if he is sharing the wealth from his bankster buddies or if he will keep it all to himself?

JR's picture

“Yesterday, the Fed reported the first $20.1 billion in net, non-rolling purchases of MBS eligible under QE3 (consisting of FHLMC, FNMA, GNMA and GNMA2, most likely the bulk of them coming out of a certain office in Newport Beach which has decided to start locking in its monster profits for the year after getting QEternity spot on).” – Tyler Durden

The Fed, i.e., the Rothschilds et al., is buying up America with fiat currency created out of nothing. The Fed  controls the message, often even creates the message and is ready with its operatives to move the ownership of the country into its private holdings.

It is a similar story to how the Rothschilds purchased the English government after the battle of Waterloo June, 1915. The Rothschild family solidified control of the English government by obtaining and manipulating information it had acquired before it was available to anyone else.

Just like the Fed, the Rothschilds had created a system of Rothschild couriers in Europe that ensured the banker family immediate information about major events in Europe even before known to the rulers of countries involved.

Nathan Rothschild, looking exceedingly glum, used advance information that Wellington had defeated Napoleon to trick bankers at the London bond market into falsely believing that England instead had lost and the bankers, under this false impression, began selling the government bonds they owned.

As more and more large quantities of bonds were sold, the more the price dropped, and the more the price dropped the more gloomy Nathan looked. And all the while Nathan’s agents were acquiring the bonds at a small percentage of their true value.

When all was said and done, Nathan Rothschild virtually had purchased the English government.

Spacemoose's picture

i guess if you are rich enough you can buy a time machine (or is there some other battle of waterloo that i'm unaware of??)

JR's picture

You’re darn right you can buy a time machine. You can buy a time machine called a printing press that prints FRBNs that the Fed is using as a world reserve currency. What can be more valuable in the world at this moment than a machine that prints money; estates, yachts, diamonds and nations fade in value compared to your machine.

“Permit me to control the money of a nation, and I care not who makes its laws.” –Meyer Rothschild aka Ben Bernanke

It’s the time-old international banker strategy of loaning to national governments and impoverishing the people by convincing nations to pay their debts by playing one against the other and using control of the money supply to force the “balance of power,” via war financed by fiat money, if necessary.

fourchan's picture

buy the fucking dip, please?