Chart Of The Day: The Collapsing Half-Life Of Unsterilized Central Bank Intervention
Assuming that Ben Bernanke unveils the transition from 'sterilized' Twist to 'unsterilized' QE4 today (which if he doesn't will upset more than a few long-only managers looking to make their year), then the chart below shows the incredible and insatiable demand for money printing (and the central banks' acquiescence). Looking at just outright incremental injections of excess reserves (money-printing), since the whole 'experiment' began, the Fed and ECB have embarked on more and more frequent attempts to prop up this 'fundamentally' sinking ship. Perhaps this is what the Hong Kong Monetary Authority warned of? At the current average decay period of around 40% per action, we should see the ECB or Fed enact something new by around February 4th (just as the debt-ceiling comes to a head).