Stocks Slump As Bernanke Admits "Doesn't Have Tools To Ease Fiscal Cliff"

Tyler Durden's picture

For the third time in a row, a speaker from the Fed has opened their mouth and the market has fallen in. This time, unlike Yellen's silliness, Bernanke admitted a few ugly truths by removing hopes for an IOER cut and bluntly explaining that the Fed 'will not go back to work' to help Schumer and his fiscal cliff buddies:


S&P futures fell around 8 points as he uttered these words but was rescued by some anxious BIS scrambling in EURUSD, before falling back to reality (along with AAPL).


S&P 500 futures...


Leaving S&P 500 futures at yesterday's day-session open...


and AAPL at yestereday's VWAP now...

Charts: Bloomberg

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edb5s's picture


    ES-Sniper's picture

    Weeks away from potentially pulling the world into an ecomonic disaster,


    and where is the President and Congress?!!


    The President is in Cambodia, and Congress is home for Thankksgiving.


    Lazy, fake concern..... Congress can legally front run, so you know they are all short already.



    LongSoupLine's picture

    critical mass...bitchez!

    fuu's picture

    Maybe even critical mess.

    fonzannoon's picture

    "When it becomes serious you have to....tell the truth?"

    Something stinks.

    Winston Churchill's picture

    Maybe the realization that we've run out of road,to kick a can down.

    Trouble is that was a decade ago really.

    $6T a year in GAAP deficit spending Plus $16T in debt.

    Anyone know a good,cheap, bankruptcy lawyer ?

    Just Ice's picture

    When it becomes serious you go out in public and in essence state they ain't gonna lay the crap on you when it all hits the fan.

    Besides, now that the election's over, his own mandate is most likely not gas the rampola but brake the slide.

    blunderdog's picture

    You mean...the ability to print money can't redeem a failed government?

    Whocouldaknowed.  Unpossible.

    Yen Cross's picture

     Ben to Mario... OVER

       What is it Ben? I'm prepping a tapebomb for the European session damn it! OVER

    Did you catch my conference this afternoon Mario? OVER  

        CRICKETS... followed by sounds of kitchen sink flying through glass window...

    fonzannoon's picture

    Is it me or did Ben intend to crash the market today and the market is not cooperating?

    Yen Cross's picture

     He saved my ass. I open a risk short trade earlier, and got out with a small profit... Now I just reversed it for the 3:00 p.m. ramp up. ;-)

    fonzannoon's picture

    Haha. Good for you man. My guess is this is a setup. O is going to push us off the cliff or get everything he wants. Bernanke admitting the fed has whiskey dick was just a feather in O's cap when he throws this at the repubs and accuses them of not making a deal. Boehners biggest mistake was having O jump out of that birthday cake in a G string and pat him on the back.

    Yen Cross's picture

     Hey fonz we are big time FUBAR! The fiscal cliff is just a diversion.

    I'm sure you have looked at all the posts on this thread so I won't elaborate.

    Earnings are screwed, the global economy is slowing down. They can print all they want.

    All they will succeed in is causing massive social unrest when the masses can't afford to feed themselves.

    fonzannoon's picture

    Oh I hear you. I just mean it is just part of the play. I agree with you on the big picture.

    I am watching CNBS, Cramer keeps storming all over the set and leaning over people. I hope he has awful breath. I think in a few years he will look just like that NYPD Blue actor Dennis Franz.

    Yen Cross's picture

     Good comparison. Cramer needs to load up on the Twinkies though. He's a little "girlie man"...

    edb5s's picture

    3:00 ramp came in a bit earlier than expected today.  Hope you were still able to benefit.

    QE49er's picture

    Bernanke: Tell me my dear what can I do for you?

    Lady Liberty: Chairman, my economy for 5 years has languished in the gutter, if I don't get it out soon it will surely die, I throw myself on your mercy, I'll do anything...

    Bernanke: Anything?

    Lady Liberty:  Mr. Bernanke I was raised in a convent. I don't indulge in pleasures of the flesh

    Bernanke: You don't print out, the economy don't get out.

    Lady Liberty: Chairman, I simply don't do it.

    Bernanke: Come on, you do it. You love to do it. We all do it. You do it...

    Lady Liberty: No, I don't!

    Bernanke: I do it, I love to do it. I just did it and I'm ready to do it again, don't tell me you don't do it! Now you either do it, or your economy dies, it's either Pump or Death.  You got 10 seconds to make up your mind...PUMP...DEATH...PUMP...DEATH...PUMP...DEATH...PUMP...DEATH...PUMP...DEATH...YOUR TIME IS RUNNING OUT!!!


    tawse57's picture

    S&P futures fell about 8 points - WOW! Wake me up when there is a REAL correction.

    RealityCheque's picture

    Bernanke et al talk shit and jawbone the markets down in an attempt to force politicians to come up with a cobbled solution to the fiscal cliff. Drop in the s&p impacts 401k's and leads to politicians getting fearful of their inaction costing them their spot at the trough in the next election.

    I expect we'll see more of this over the next few weeks.

    Well played benny, you cunt.

    John Law Lives's picture


    The Bernank is not looking out for Joe Sixpack.  He doesn't do their bidding.

    ebworthen's picture

    Did you hear it?

    Did you hear Ben hint about raising rates?

    He made a strong suggestion that "as the economy improves" rates will be raised.

    So what reason other than propaganda would the BLS put forth less-than-truthfull employment statistics?  Housing "recovery"?  Why, so the FED can raise rates of course!

    They will do it.  People say "they can't" because of the interest on the debt, but what would that matter if you are willing to drop $6 Trillion in four years and $40 billion a month in perpetuity for MBS's?

    Bank bail out part two.  Raise rates, have more foreclosures, get that credit card interest up along with ARM's, collapse the American Household - bleed every last penny out of them - force them to cash out IRA's and 401K's at higher penalty tax rates - milk every last cent of Mom and Dad's and Grandma and Grandpa's - 50% death tax on every estate, 25% on the sale of a home if you have any equity.

    Get ready main street!  Anal rape part II coming soon!

    fonzannoon's picture

    It's an interesting viewpoint ebworthen. But I look at the way they are using Sandy to skew every data point. I think they play up this "recovery" like you say only to have something....Europe or something dump and use that as the "damn we almost were at full recovery until...." so they can keep rates low etc.

    ebworthen's picture

    What tools does the FED really have?

    Lower rates, raise rates, lower rates, raise rates...

    What did old Greenspan do in 2004?  He raised rates.

    After they had everyone take out a home equity loan and max out their credit cards, the mfuckers raised rates.

    This induced the crash of the housing markets and the markets in general.  So now the FED is buying $40 Billion a month in MBS's and I see reverse mortgage and equity home loan commercials again.  Rates are at all time lows.  So...what does the FED have left?

    Raise rates.

    Clowns on Acid's picture

    Lets see here -

    • Higher taxes on incomes > 250k
    • "Cuts" in Gov't spending
    • Hostess takes a knee to get rid of Unions demands
    • HP reports fraudulent Acc't practices (oh ..of course they are alone...I mean it's Deloitte doing the audits man !)
    • Inflation thru smaller packaging is becoming rampant
    • More Gov't regulations / "distributive" policies.

    So whatever the "grand bargain" reached to not go over "cliff" there is no growth.

    Gotta buy equities right?

    tawse57's picture

    Gotta buy equities right?


    Yep, seems that way - pushing us all into stocks.

    Conman's picture

    So again - whats was actually done again in the past week that we are back to BTFD? Lol more talks and plan to plan the plan that will fix europe. Deja vu all over again, yet the markets fall for it everythime. Or should i say algos.

    jumbo maverick's picture

    I watched much of the speech. They applauded at the end. What I took note of was his comments on how they want to make programs so that these empty homes across the country can be rented out.

    That is code words to me that section 8 is gonna blow up. HUD is going to get billions more for the section 8 program to pay for poor people's rent. Wealth redistribution. HUD will get billions more on top of that for administration costs to run the program. More wealth redistribution. And there will be some bank along the way that will get billions in fees to manage all of this money. Rent payments on card styled similar to the SNAP system. More wealth redistribution.

    Just both 40 more silver eagles.

    walküre's picture

    Why can't Greece afford that?

    ugmug's picture


    Fiscal Trampoline not Fiscal Cliff


    As the end of the year approaches all of the liberal media's psychopathic hysteria about the 'Fiscal Cliff' is laughable. America is not heading for a 'fiscal cliff' but is instead heading for a 'fiscal trampoline'. Since all of our government's egregious deficit spending is now permanently entombed in the budget, by virtue of baseline budgeting malfeasance, congress is going to launch America still higher into the rarefied air of insolvency. 


    Politicians have printed so much money to pay for our ravenous appetite for big government that it has concocted a rhetorical trampoline to throw all of its budgetary bungling up in the air and out of sight thinking that it will never return to earth again. But once again all of deficit spending that was launched into the air by congress at its last debt ceiling trampoline launch is heading back to earth. 


    The trick for all of our clownish politicians in congress is to keep moving the fiscal trampoline around hoping to place it directly under the descending pile of debt in order to relaunch it back into the air and out of sight for another few months. This sordid political circus act will go on for years to come until the debt burden becomes so large that it will even collapse the fiscal trampoline and create a hole so deep that it will go straight through to China.



    Peterus's picture

    He won Obama 1 election, maybe now he'd like to rescue some semblence of credibility? At least not to be loughing stock for the rest of his life, after it all goes south.

    Or it's just Greece's medicine being readied for the US of A.

    jomama's picture

    the bernak doesn't decide shit.  he does as he's told like the rest of the good little talking heads.

    QQQBall's picture

    Bernanke has been bailing out the banks. Fiscal Cliff = Reality... now or later; the longer we wait, the worse the pain.

    DowTheorist's picture

    On Nov 16, a primary bear market was signaled by the Dow Theory. Thus, the odds favor downward movement. Technically, the market is heading south. Bernanke will have a tough time reflating the balloon. Headwind for QE.


    Everybodys All American's picture

    Bernanke creates the cliff largely by allowing Congress to operate without a budget under Obama. Gets Obama re-elected with his wealth affect by buying every US treasury he could get his hands on for the last four years. How has that worked out? Well we have more people on long term unemployment than ever. Food stamp and disability rising enormously. Social Security is closer to failing because of the flattened yield curve. Seniors and others on fixed income are worse off with no return on savings. Banks can't perform typical safe strategies because Bernanke has flattened the yield curve forcing everyone into riskier assets. The US loses it's AAA credit rating for the first time ever and will likely see further declines. Don't tell me Bernanke has not been warned it's coming again.

    Now he finally admits that he has no clue. Hell, I knew this at least four years ago. I got a Bernanke Put for ya. Put that bastard in jail.

    ZFiNX's picture

    Bullshit, Bernank. Paying interest on the reserves is the only reason we are not in another fully-fledged credit-generated asset bubble right now. We know when it gets bad enough, you'll stop paying those banks to hold money and they'll flood the market with easy credit we want and will need now we're just going to print so much money our incomes won't keep up with the inflation.

    John Law Lives's picture

    This sounds like pure posturing from The Bernank to motivate Congress to act.  We all know damn well that The Bernank stands ready to print to infinity if he deems it necessary.  The Bernank also said today he wants the federal spending limit to be raised.  Imagine that...

    Pure posturing.

    Pure FUBAR.

    orangegeek's picture

    What goes down, much go up - algo rule number 13. 


    Fucking algos.