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FOMC Minutes Released: Dissension To QE4EVA Growing

Tyler Durden's picture


While some were concerned at the Fed's new quantitative targets as suggesting early tightening, it appears (from the FOMC Minutes) that those fears were somewhat warranted (with most seeing QE ending in 2013):


The punchline: "several" means more than just QE4 hater Jeff Lacker are turning hawkish. Though, even with the risks, they want moar. Pre-FOMC Minutes: ES 1460, 10Y 1.86%, EUR 1.3108, Gold $1674. Post: ES -6pts, 10Y +5bps, EUR -40 pips, Gold -$10.


Here is the punchline from the report:

In their discussion of monetary policy for the period ahead, all members but one judged that continued provision of monetary accommodation was warranted in order to support further progress toward the Committee’s goals of maximum employment and price stability. The Committee judged that such accommodation should be provided in part by continuing to purchase MBS at a pace of $40 billion per month and by purchasing longer-term Treasury securities, initially at a pace of $45 billion per month, following the completion of the maturity extension program at the end of the year. The Committee also maintained its existing policy of reinvesting principal payments from its holdings of agency debt and agency MBS into agency MBS and decided that, starting in January, it will resume rolling over maturing Treasury securities at  auction. While almost all members thought that the asset purchase program begun in September had been effective and supportive of  growth, they also generally saw that the benefits of ongoing purchases were uncertain and that the potential costs could rise as the size of  the balance sheet increased. Various members stressed the importance of a continuing assessment of labor market developments and reviews of the program’s efficacy and costs at upcoming FOMC meetings. In considering the outlook for the labor market and the broader economy, a few members expressed the view that ongoing asset purchases would likely be warranted until about the end of 2013, while a few others emphasized the need for considerable policy accommodation but did not state a specific time frame or total for purchases. Several others thought that it would probably be appropriate to slow or to stop purchases well before the end of 2013, citing concerns about financial  stability or the size of the balance sheet. One member viewed any additional purchases as unwarranted.

Full FOMC minutes (link)

FOMC Mins December


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Thu, 01/03/2013 - 15:05 | 3119520 DrDinkus
DrDinkus's picture

10s flushinggggggggg

Thu, 01/03/2013 - 15:21 | 3119587 IvyMike
IvyMike's picture

Why do privation enterprise advocates have such a problem with a privation bank run for the profit of its privation owners?

*private, I mean private! Oh well, privation and private mean the same thing anyway, if you study your Latin etymology.

Private - privation - privilege - privity - privy
University of Hull

Isn't Privation enterprise grand?

Thu, 01/03/2013 - 15:39 | 3119692 ebworthen
ebworthen's picture

Privacy is the right to fail all on your own.

Forcing failure on individuals without their consent to benefit the enterprise is hegemony.

Thu, 01/03/2013 - 15:48 | 3119729 IvyMike
IvyMike's picture

If you are correct, then Capitalism (and Communism too, they're both just slightly different variants of City-Statism (Civilization)) is hegemony, founded on THE RIGHT TO TAKE.

Of course, once wealth is taken, it's always rather nice to keep it "private" while you laugh at others' "failings." Ben has to love your attitude.

"[The Native Americans] didn't have any rights to the land ... any white person who brought the element of civilization had THE RIGHT TO TAKE. over this continent."

~Ayn Rand
US Military Academy at West Point, March 6, 1974

Thu, 01/03/2013 - 17:29 | 3120066 GCT
GCT's picture

Captilism where is it Ivy certainly not in the USA anymore.  The USA is Facist.  But the right to take is why governments are formed to be honest.  They form so someone cannot come and take what we produce.  Basicallythey were formed to protect others from taking their agricultural lands and staples.

You see throughout human history you had settlements that produced and other that took from them so they form alliances to kill the takers that did not earn it.  They formed militia's to kill the takers.  Now it is legal to just take and produce nothing.

Thu, 01/03/2013 - 17:46 | 3120117 nope-1004
nope-1004's picture

I'm going to go out on a limb here, because these "free" and efficient markets are just way too obvious......

The Fed releases it's "Minutes" of the meeting a few weeks after the meeting.  Ever wonder why?  Looks to me like they can then gauge market reaction to the policy and adjust the wording of the minutes release accordingly to change / undo / alter market reaction to whatever policy is announced, in this case QE4EVA.  Doesn't matter what is said, doesn't matter what is 'reported' by (spoon fed to) Hilsenrath, the centrally planned economy via the Fed is working well:  Control the markets, control the masses, and control public opinion.

When Bernocchio came out saying that the Fed wanted to do public Q&A's in an effort to be more "transparent", that should have been your first clue that control has been levered up and the opposite is really occurring.  Bernocchio is only a propagandist, and that's it.  He's certainly no economist, more like a self admitted idiot, as this clip before the housing crisis proves.

Don't believe this chronically dishonest private enterprise (the Fed) and its cheif liar (Bernocchio).  Corruption and media control are all that is left as policy tools.

Thu, 01/03/2013 - 17:45 | 3120123 AldousHuxley
AldousHuxley's picture

Top elites never produce, just take % of what you produce.
Just like a mob, protection fee for profit sharing without real work or ownership

Thu, 01/03/2013 - 20:50 | 3120637 IvyMike
IvyMike's picture

You've got civilization (city-statism) nailed.

Thu, 01/03/2013 - 20:51 | 3120631 IvyMike
IvyMike's picture

Captilism...not in the USA anymore.

You're committing the No True Scotsman logical fallacy.

Besides, Fascism has eternal merit because it saved City-Statism (civilization), according to one capitalist economist:

"It cannot be denied that Fascism and similar movements aimed at the establishment of dictatorships are full of the best intentions and that their intervention has for the moment saved European civilization. The merit that Fascism has thereby won for itself will live on eternally in history."

~Ludwig von Mises, Liberalism

me·rit (n.) 1. Superior quality or worth; excellence 2. Demonstrated ability or achievement.

You see throughout human history...

No, you're just parroting Civilizationist (City-Statist) garbage that you haven't even begun to study yourself.

"The current literature consistently reports that until the final stages of the Paleolithic Age—until just prior to the present 10,000-year era of domestication—there is no conclusive evidence that any tools or hunting weapons were used against humans at all."

~John Zerzan
On the Origins of War

Thu, 01/03/2013 - 16:17 | 3119827 OneTinSoldier66
OneTinSoldier66's picture

Is counterfeiting money up out of thin air, that people are required to use through legal tender laws, civilized behavior? Do you believe that the Federal Reserve System should be allowed to counterfeit money up out of thin air for it's member banks? Do/did you believe in bank bailouts? Is it your belief that a bank that is a member of The Fed and can go to it's "discount window" should never be allowed to fail?


Is privatizing the profits for those that are "well-connected" and socializing the losses onto the masses civilized behavior? Are poor people the only ones that should fail?


Where's my bailout? Or do I first have to hoodwink enough people into some kind of scam to the tune of tens of billions of dollars first, then have nothing to show for it because I already spent all the money, before I can receive a bailout? Is that what entitles' me to a bailout?

Thu, 01/03/2013 - 15:22 | 3119601 LawsofPhysics
LawsofPhysics's picture

Indeed, push those yeilds on the 10 year past 2%, come on, I dare you.

Thu, 01/03/2013 - 15:38 | 3119639 ZerOhead
ZerOhead's picture

Never. Fight. The. Fed.

I learned that the hard way from Buzzy years ago when the tens were over 3. When this starts to turn all of those trillions of 'liquidity' injected into the system over the years will be positioned short to crash it with 100X leverage. She'll come down like WTC1, WTC2 and WTC7. The next act will be Fed injections through the CB's and Primary Dealers of a hundred trillion or more... transferring all global strategic assets to those with access to credit in the process.

And the sheep will be screaming for it.

Thu, 01/03/2013 - 15:56 | 3119764 LawsofPhysics
LawsofPhysics's picture

Bullshit.  The commodity complex will break this time around.  When fraud is the status quo, possession is the law.  Really don't give a shit about paper "assets" at this point, nor do I care for paper promises.  You can have all you want.

Thu, 01/03/2013 - 16:14 | 3119807 ZerOhead
ZerOhead's picture

Agreed it will all break. Down first and then way way up. I am waiting for a buying opportunity to pick up as much copper and tin ingot as the concrete floor in my warehouse will support.

As quickly as possible.

Then watch the dollar (and other currencies) wash away in the Fed's tsunamic response to reinflate in a sea of hyperinflation...

Thu, 01/03/2013 - 17:36 | 3120088 trav777
trav777's picture

we have wars to arbitrate that.  And the police will wage it on you

Thu, 01/03/2013 - 17:42 | 3120111 WhiteNight123129
WhiteNight123129's picture

Not where I sit Trav. How is fixed income doing today?

Thu, 01/03/2013 - 17:43 | 3120112 WhiteNight123129
WhiteNight123129's picture

Not where I sit Trav. How is fixed income doing today?

Thu, 01/03/2013 - 17:42 | 3120113 WhiteNight123129
WhiteNight123129's picture

Not where I sit Trav. How is fixed income doing today?

Thu, 01/03/2013 - 15:57 | 3119769 IvyMike
IvyMike's picture

If by sheep you mean docile and stupid domesticated mammals, then you must include all humans too.

Peter J. Wilson (1991) The Domestication of the Human Species. Yale University Press.

Jack Goody. (1977) The Domestication of the Savage Mind. Cambridge University Press.

Although some of us are less poodle-ized than others.

"...if we aspire to break the bonds domestication has laid on us, to STOP BEING DOGS, AND BECOME WOLVES AGAIN."

~Jason Godesky
Wolves & Dogs

Hey, Ben Bernanke's dad is third picture down! LOL!

Thu, 01/03/2013 - 17:32 | 3120080 GCT
GCT's picture

Agree Ivy most are domesticated and need the government teat to survive.  The wolves are the politicians and the financial institutions in the world right now.  The only way to stop being a prey animal is to stop playing the debt game.  I could go on about being prepared for disaster but most already know this if they can think critically at all.

In the end it will be survival of the fittest as it always has been until the last century.

Thu, 01/03/2013 - 15:45 | 3119671 WhiteNight123129
WhiteNight123129's picture

The thing is that rising long bond will mean corporation borrow in a hurry and spend. Long bond rising and rising inflation push people to dishoard financial assets....

So rising long yield can move nominal GDP upwards. (inflate away), that means less borrowing needed from Gov but quite a bit of sticky and chronic inflation.



Thu, 01/03/2013 - 15:52 | 3119732 LawsofPhysics
LawsofPhysics's picture

yes, putting even more pressure on the commodity complex.  exponentially more in fact, good luck with that.

Thu, 01/03/2013 - 16:22 | 3119832 negative rates
negative rates's picture

I dared um to go past 1%, they said how about adding a 0 then? I said fine, as long as it's one of yours! 

Thu, 01/03/2013 - 15:27 | 3119631 SilverRhino
SilverRhino's picture

Argentum Futatrix!! 

Thu, 01/03/2013 - 19:50 | 3120449 SimplePrinciple
SimplePrinciple's picture

That would be Latin for doing it Argentina style.  Let Congress enact that government bonds be bought by everybody's retirement accounts, so the central bankers can take a break.

Thu, 01/03/2013 - 15:30 | 3119645 Cult_of_Reason
Cult_of_Reason's picture

Unlimited free money party for Wall Street is over. There are limits to this unlimited insanity.

Thu, 01/03/2013 - 15:45 | 3119709 ebworthen
ebworthen's picture

Sort of.

They'll cut QE and raise rates so they can crash everything, rob savers and pensioners and individual investors (again), and bail out the banks and bankers all over again.

I mean, they could spend another $5 Trillion on QEX - or on another round of TBTF Bank, Insurer, and Corporation bailouts.

It's twisted perverted counter-intuitive reasoning, but this is the FED.

Watch 'em do it.

Thu, 01/03/2013 - 17:33 | 3120083 Irelevant
Irelevant's picture

Gold does very well in a deflation scenario. Bills and Bonds not so well. It is impossible for the FED, with a 1.5$ trillion/annum exponentially growing debt to stop QE4, or any other money printing scheme for that matter. I think they are trying to bring down the price of oil, as they see a recession ahead for the US (Europe is in one). Also they will be able to point out, look, we stopped QE and the economy went down the drain. Those pesky tea party activists took your job, and your house, and your wife and they are terrorists. Gold is wealth, if you buy it today ask for physical and hold it for a minimum of 5 years. Gold, as in physical gold, held by you, is not part of the casino called the stock markets. The price they present on Bloomberg is irrelevant. Its funny how they smashed gold on the last days of last year, when it was impossible to buy any as all the shops were closed. And also don`t worry, the masters own more physical gold than we will ever do. We need a global French Revolution, that is the only solution, we need Thomas Jefferson, that is the only way to go! Actually in what we have ahead of us gold is pretty much irrelevant. Water, food, heating will be a much more urgent issues for many.

Thu, 01/03/2013 - 15:06 | 3119522 Stuart
Stuart's picture

Follow what they do, not what they say.  Not a snowball's chance in hell QE is ending while $1.5T annual deficits continue.  Money to finance this deficit has to come from somewhere cause they sure ain't going to cut spending. 

Thu, 01/03/2013 - 15:15 | 3119577 centerline
centerline's picture

Exactly.  This is pure theater.  Nothing more.

Now, just to play devil's advocate, one potential spin on this is force the politicians' hand.  Needing the fingerprints of those clowns on the printing press lever for the last big pull before everyone officially goes all funny-like.

Either way, turn of the spigot and the system collapses overnight.  Heck, just leaving it as is would cause the same thing but delayed.

Thu, 01/03/2013 - 15:19 | 3119592 SpykerSpeed
SpykerSpeed's picture

Yeeeeup.  The collapse is coming, one way or another.  The only way to avoid it is to slash the size of government massively, practically overnight.  Even in that best-case-scenario (for the US dollar), you'd still have a major depression while people try to find new jobs and wages fall.

Thu, 01/03/2013 - 15:24 | 3119597 ZerOhead
ZerOhead's picture

No way to avoid it... like Ron Paul said... we probably passed that exit on the interstate in the early 2000's...

Quantitative Easing is getting old. Perhaps Quantitative Delaying is more appropriate under the present circumstances...

Thu, 01/03/2013 - 15:25 | 3119615 LawsofPhysics
LawsofPhysics's picture

Unless of course the union is dissolved, following the soviet model.  In that case, as with the soviets, a phone number will be given to all of America's creditors and an answering machine will be placed at one end with the following message; "We're sorry, the party you are trying to reach no longer exists and neither does their debt."

Hedge accordingly.

Thu, 01/03/2013 - 15:40 | 3119698 ZerOhead
ZerOhead's picture

E Unum Pluribus

Thu, 01/03/2013 - 15:49 | 3119731 LawsofPhysics
LawsofPhysics's picture

just another paper promise.

Thu, 01/03/2013 - 15:25 | 3119616 cougar_w
cougar_w's picture

Dude. Serious listen to me here. They could slash the size of government to ZERO (0) (nada) (bagels) and still not be able to maintain a positive cash flow.

There is simply no way this situation can be improved. No wait, I know something that would make it at least look better: a direct hit by a meteor.

Thu, 01/03/2013 - 15:26 | 3119623 LawsofPhysics
LawsofPhysics's picture

Correct.  I think the euro-soviet solution is the answer. The sooner the better.

Thu, 01/03/2013 - 15:34 | 3119675 cougar_w
cougar_w's picture

My scenario has the Fed and Congress end up holding a really big bag of steaming poo-caca, and then everyone agrees to dissolve the Union.

Debt repudiation by suicide.

Coastal states and cities get the nukes and form federations, Canada and Mexico go all M&A with border states, and the heartland becomes Iowastan.

Thu, 01/03/2013 - 16:58 | 3119970 FoeHammer
FoeHammer's picture


Thu, 01/03/2013 - 15:46 | 3119721 Ghordius
Ghordius's picture

WTF is "the euro-soviet solution"?

Thu, 01/03/2013 - 15:57 | 3119770 LawsofPhysics
LawsofPhysics's picture

see cougar's link.  It is impossible to repay the debt, period.  The soviets have been through this already.

Thu, 01/03/2013 - 16:42 | 3119903 Harbanger
Harbanger's picture

Apples and oranges, when the Soviet Union dissolved it lost control of the 14 seperate nations it conquered by force.  Russia is still intact and dangerous.

Thu, 01/03/2013 - 16:49 | 3119936 LawsofPhysics
LawsofPhysics's picture

Right, so are you saying that American territory was aquired peacefully then?  LMFAO!  "Russia" and the "Soviet Union" are two very different entities.  I have done business in Russia for 20+ years.  The collapse of a centrally planned, over indebted, superpower is what it is.

Thu, 01/03/2013 - 16:56 | 3119961 Harbanger
Harbanger's picture

There's no comparison between the formation of the Soviet Union snd the United States.  Russia conquered established countries and failed to hold them together.

Thu, 01/03/2013 - 17:00 | 3119975 FoeHammer
FoeHammer's picture

Maybe one day you'll get it.

Thu, 01/03/2013 - 17:04 | 3119993 Harbanger
Harbanger's picture

Get what?

Thu, 01/03/2013 - 17:24 | 3120045 LawsofPhysics
LawsofPhysics's picture

Perhaps, connecting the dots is too complicated for you.  Allow me to simplify.  How the Soviet Union got to their endpoint compared to how the U.S. got to the same endpoint is irrelevant.  We are here, now, with far too many paper promises and no real consequences for bad behavior.  We Who gives a shit about the "formation", the past is dead and collapse is collapse and all economies are really local in the end.  Get your tribe in order (regardless of whether or not your members belong to a conquered country - FYI, the Navajo still consider themselves as such).

Thu, 01/03/2013 - 17:43 | 3120106 Harbanger
Harbanger's picture

The Soviet Union got to it's end point not because of a failed currency, but because of a failed communist system, Russia is still intact.  The US got to this point not because of a failure of capitalism, but a failed federal reserve banking system. It's fundamentals are still intact.  FYI- the Navajo were slightly more advanced than the russian peasants of the time.

Thu, 01/03/2013 - 17:51 | 3120130 Ghordius
Ghordius's picture

have to agree though I miss a "deficits do matter" in your comment

and a failed currency is a unique experience with special side effects

but dissolution from it is historically not a given

on a lighter note: putting "euro-" in front of it does make it friendlier, eh? ;-)

sounds way better than "The Fall of the Soviet Empire"

Thu, 01/03/2013 - 17:36 | 3120091 GCT
GCT's picture

Harbanger you forgot about that Civil War we had did yah? 

Thu, 01/03/2013 - 17:42 | 3120109 Harbanger
Harbanger's picture

We were already the United states before that genius.

Thu, 01/03/2013 - 15:16 | 3119581 nope-1004
nope-1004's picture

+1.  QE can't end.  Their press release is a total facade.


Thu, 01/03/2013 - 15:21 | 3119598 cougar_w
cougar_w's picture

+1 head fake

Might suggest that things are starting to seriously come unwound over at The Fed.

I tell you though, you'll know they are serious about endinging QE right after there is a whisper rumor started that "not all sovereign debt is equally important" meaning selective default is in the cards.

Thu, 01/03/2013 - 15:24 | 3119609 Raymond Reason
Raymond Reason's picture

They would love to end QE, but that's the paradox.  The central bank as their means to power, is the same bank that is destroying their power.  You should try being an oligarch sometime, it's not all coke and dames you know. 

Thu, 01/03/2013 - 16:05 | 3119797 spastic_colon
spastic_colon's picture

spot is just a test to see what jobs number they need to report tomorrow

Thu, 01/03/2013 - 15:06 | 3119525 punxsutawney phil
punxsutawney phil's picture


Thu, 01/03/2013 - 16:54 | 3119594 WhiteNight123129
WhiteNight123129's picture

I am very happy with my Short Treasuries, but I will short Gold when real interest rates are POSITIVE again* sorry. Now the good news is that long bond rising while teh short end will go possible lower, means that inflation is going to rise faster than the long bond yield. No need to short Gold now.

Before now you had a currency devaluation, not inflation. Inflation is something else. Dearness is money in the hands of the consumer  while cheapness is money in the hand of the capitalist. So the capitalist sells his bond and spends it instead of hoarding it. It ends up in the hands of the consumer and dearness follows.

And it looked like prices of foreign used goods (energy, and soft commodities) was creating inflation. But you had no inflation so to speak, just currency going down. Now we should see the multiplier rise and quite a bit. That will wacke financial assets and raise nominal GDP.

Fullarton is of great help indeed. Rising nominal long rates is inflationary while declining nominal long rates are deflationary. The declining long rates encourage the increase in financialization (removing money from circulation to go into finanical assets or leveraging), the rising long rates encourage the spending of financial assets into the circulation (deleveraging).

Devaluation can occur with flat yield curve, inflation needs steeper yield curve.  We are having it now.

Printing is the cause of future inflation, and the smart gold bugs bought the printing which also creates negative yield.

Sell your Gold when interest rates are at 7%, official inflation is at 9% and INFLATION OUT OF CONTROL is the headline on New York Times.

Too early to sell.



Knee jerk selling could start now in Gold.






Thu, 01/03/2013 - 15:24 | 3119613 Stuart
Stuart's picture

Shareholders need to get their miners to stop delivering into the exchanges, stop enabling paper gold manipulators of dictating the price.  Any Gold co manager reading this, take your gold and stockpile it like Rob McEwen used to do it.   Until then, gold miners are just patsies being played as chumps.

Thu, 01/03/2013 - 15:27 | 3119633 oak
oak's picture

during Mr. obama's 1st presential term, the s&p500 up 600 points approximately and the au price almost doubled. what will happen in his 2nd term, you think?

Thu, 01/03/2013 - 16:11 | 3119762 Anasteus
Anasteus's picture

And now go long gold and easy money again...

But I understand your pleasure. If you're good at scalping and you know when to stop to withdraw the cash and buy physical then you're following probably the best investment strategy these days.

Thu, 01/03/2013 - 15:06 | 3119526 dynomutt
dynomutt's picture

Time to let the sand out of the hourglass?

Thu, 01/03/2013 - 15:13 | 3119564 1100-TACTICAL-12
1100-TACTICAL-12's picture

Double dawg dare'em, to turn off the QE spigot..

Thu, 01/03/2013 - 15:19 | 3119527 ekm
ekm's picture


Only Obama can call that shot. He may have already signed the executive order to crap the market.

Thu, 01/03/2013 - 15:06 | 3119528 unplugged
unplugged's picture

Yet more deception & propaganda, all they have left besides the CTRL-P button.

Thu, 01/03/2013 - 15:06 | 3119531 Snakeeyes
Snakeeyes's picture

But they will be tempted to push down Treasury and mortgage rates again given sagging mortgage purchase and refi applications. Central planning at its WORST!

Thu, 01/03/2013 - 15:07 | 3119534 Stuart
Stuart's picture

Chinese say round eyes stupid as fuck.

Thu, 01/03/2013 - 15:14 | 3119571 ZerOhead
ZerOhead's picture

Round eyes say slanty eyes love treasuries...

Thu, 01/03/2013 - 15:08 | 3119540 Dr. Engali
Dr. Engali's picture

Darn and the transports were within striking distance of a new high. Better send some trains across border a few hundred moar times for moar tax credits.

Thu, 01/03/2013 - 15:09 | 3119543 Kreditanstalt
Kreditanstalt's picture

Oh-oh...!  The end of cheap "money"!  BUY GOLD!

(A logical person would THINK...!)

Thu, 01/03/2013 - 15:10 | 3119547 punxsutawney phil
punxsutawney phil's picture

Sold to you.  Down $100 tomorrow

Thu, 01/03/2013 - 15:11 | 3119551 Kreditanstalt
Kreditanstalt's picture

Buy paper dollars then...BE A LEMMING.

Thu, 01/03/2013 - 15:14 | 3119566 Kreditanstalt
Kreditanstalt's picture

Too bad!  It seems to have bounced already...

Thu, 01/03/2013 - 15:15 | 3119574 punxsutawney phil
punxsutawney phil's picture

Nice bounce, 1600 one touch tomorrow?

Thu, 01/03/2013 - 15:19 | 3119579 Kreditanstalt
Kreditanstalt's picture

Impossible, against all fundamentals and illogical...the bounce was $1663+/-

Thu, 01/03/2013 - 15:39 | 3119690 punxsutawney phil
punxsutawney phil's picture

Look at that my 1500 puts just doubled.  Wonder why somebody paying up so much for those

Thu, 01/03/2013 - 16:02 | 3119784 GMadScientist
GMadScientist's picture

Don't blame em, Phil...all that shiny gets in their eyes!

Thu, 01/03/2013 - 16:52 | 3119947 Kreditanstalt
Kreditanstalt's picture

Some twit who believes that gold is a "risk asset", maybe? 

Thu, 01/03/2013 - 17:28 | 3120064 punxsutawney phil
punxsutawney phil's picture

Any investment in which you are not guaranteed to get back your initial investment (even measured against other assets) is a risk.  Gold will have its day well above 2000, for sure.  But don't be fooled into thinking it can't go to 1200 before making its last hoorah.  This is very long game our CB's are playing.

Thu, 01/03/2013 - 17:38 | 3120095 Kreditanstalt
Kreditanstalt's picture

At the end of the games and manipulations, I will still have exactly the same number of ounces.  Supply and demand profile.  

Gold demand (for the real, unlevered metal, not 'puts', options, 'calls', ETFs, loans or GLD...) is steady-to-insatiable while supply is far, far more limited p/a than for your paper.

WE, not the market manipulators, are playing the long game.

Thu, 01/03/2013 - 15:09 | 3119544 Chupacabra-322
Chupacabra-322's picture

Worth a third post:

These people are Criminals and Treasonist. They're protecting a Global Criminal economic bankster enterprise system that controls the world's Governments and politcians. It's a criminal cabal based on shadow CIA/Mossad/MI6 etc.. intelligence, murder, espionage, blackmail, rackertering, bribery, threats, drug trade, human trafficing. It's a Global Criminal Cabal based on an Evil Lucerferian belief system.

The rest is just political therater for consumption by the masses.

Thu, 01/03/2013 - 16:53 | 3119590 Kreditanstalt
Kreditanstalt's picture

Not exactly.  More like evil global governments are protecting a confidence-based and corrupt financial Ponzi whose prime beneficiaries are, not at all surprisingly the politicians' biggest backers.

Thu, 01/03/2013 - 15:09 | 3119546 edifice
edifice's picture

QE will never end; it's mathematically impossible for it to. They may call it something different, put Cntrl-P will continue.

Thu, 01/03/2013 - 15:13 | 3119562 dwdollar
dwdollar's picture

Yep, just like politicians claiming their gonna make cuts any day now...

The Ponzi must continue to inflate at all costs.

Thu, 01/03/2013 - 17:50 | 3120128 Bicycle Repairman
Bicycle Repairman's picture


Thu, 01/03/2013 - 15:10 | 3119548 TheDarkKnight
TheDarkKnight's picture

The Titantic has hit the iceberg, everyones scrambling for the lifeboats.



Thu, 01/03/2013 - 15:11 | 3119550 kito
kito's picture

dissension growing....ha...ha........members are just ensuring their "objections" are duly noted before all hell breaks loose...........they want to make sure the pitchforks and torches arent headed to their abodes.....................we all look forward to the end of qe3456...........cant wait to see the federal government fund its debt when the interest rates revert to the mean........................cant wait to see housing return to true market conditions when the fed stops purchasing mbs.......oh boy, what a day that will be!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

Thu, 01/03/2013 - 15:14 | 3119570 Dr. Engali
Dr. Engali's picture

Hey kito I saw some of your predictions you gave to fonz yesterday. As a deflationist you don't really expext the dow to hit a new all time high do you? How does that jive with your thesis?

Thu, 01/03/2013 - 15:28 | 3119635 kito
kito's picture

hey doc, i dont expect any type of deflationary tsunmai to occur this until then, the excess liquidity may continue to find its way into the markets..................i have a david stockman outlook.......that one day, the enitre market of everything, wayyyyy overbought with digital dollars and leverage,  will be crushed........i say 2015....not before..................

Thu, 01/03/2013 - 15:44 | 3119691 Dr. Engali
Dr. Engali's picture

Well personally I don't believe the market will ever touch it's old highs let alone an inflation adjusted high unless they hyperi-nflate.

Thu, 01/03/2013 - 15:29 | 3119652 cougar_w
cougar_w's picture

The price of the Dow is not connected to any real or fundamental thing now.

But deflation is real enough and is set to eat us alive from the inside, leaving a lovely husk of a market corpse for the algos to palpate with their wee tentacles.

Thu, 01/03/2013 - 15:36 | 3119679 Dr. Engali
Dr. Engali's picture

I know thw DOW has no fundamental value, but if you're a deflationist you have to believe the market will be taken down along with the destruction of debt. The Japanese have tried propping the market up for years fighting deflation but the market forces push the NIKKEI lower.

Thu, 01/03/2013 - 15:40 | 3119695 kito
kito's picture

the value of the DOW is certainly fundamental to TPTB holding their influence on the world.................and the market would implode along with everything else that has been absorbing digital dollars............just not this year...............

Thu, 01/03/2013 - 15:11 | 3119552 Carl LaFong
Carl LaFong's picture

Here's the money quote:

In their discussion of monetary policy for the period ahead, all members but one judged that continued provision of monetary accommodation was warranted in order to support further progress toward the Committee’s goals of maximum employment and price stability. 


Virtually unanimous support for QE to infinity. What else does one need to know? All the rest is MOPE.

Thu, 01/03/2013 - 15:12 | 3119559 robnume
robnume's picture

Plunge Protection Team, FOAD!!!!! And I command you to take the entire U.S. financial system with you!!!

Thu, 01/03/2013 - 15:13 | 3119561 John Law Lives
John Law Lives's picture

"In their discussion of monetary policy for the period ahead, all members but one judged that continued provision of monetary accommodation was warranted in order to support further progress toward the Committee’s goals of maximum employment and price stability."

Price stabliity.  Thanks for the laugh, Chairsatan.

Thu, 01/03/2013 - 15:17 | 3119584 Racer
Racer's picture

He doesn't know the meaning of the word 'stability' like he didn't know the meaning of the word 'contained'

Thu, 01/03/2013 - 15:14 | 3119568 Yen Cross
Yen Cross's picture

 XAU is getting Jack Hammered! Down over $23 on some dumbass moodys comment.

Thu, 01/03/2013 - 15:28 | 3119611 Anasteus
Anasteus's picture

and JPM's due diligence.

Thu, 01/03/2013 - 15:18 | 3119569 MFLTucson
MFLTucson's picture

This is a group of liars because no one is buying our debt.  Outright fucking lie and I have had enough of this group of shit manipulating these markets and Gold inn particular.  Get these Jews the hell out of this country and out of this money, they are the devil!

Thu, 01/03/2013 - 15:30 | 3119659 retiringteach
retiringteach's picture

you're not good enough to eat a jew's shit-redneck asshole!


Thu, 01/03/2013 - 16:34 | 3119878 MFLTucson
MFLTucson's picture

But, I am good enough to get a fuckin clown like you to respond!

Thu, 01/03/2013 - 15:36 | 3119681 yogibear
yogibear's picture

Goldman, MS have shorts and want to go long cheaper on PMs.

Thu, 01/03/2013 - 15:14 | 3119572 cdude
cdude's picture

Will NOT happen in 2013. That is if the plan is to keep the Static (sp) Quo. This has been a test of the Money Printing System. We now return to the regularly scheduled programming.

Thu, 01/03/2013 - 15:14 | 3119573 Anasteus
Anasteus's picture

Yeah, and the fourth point would be


Thu, 01/03/2013 - 17:36 | 3120090 Bunga Bunga
Bunga Bunga's picture

What cost? It costs only a few cents to print a 100 dollar note.

Thu, 01/03/2013 - 15:15 | 3119575 Boilermaker
Boilermaker's picture

The RUT almost went down for a moment and stopped it's relentless bidding up marathon.'s back to being slammed non-stop upward.  THANK GOD!  BERNAKE!

Thu, 01/03/2013 - 15:15 | 3119576 Racer
Racer's picture

They knock the price of gold hard but not the 'markets' much

Thu, 01/03/2013 - 15:17 | 3119585 Undecided
Undecided's picture

WSJ just reported that bond buying will end this year. then removed the link, look at the price of gold..

Thu, 01/03/2013 - 15:19 | 3119591 VonManstein
VonManstein's picture

Just an excuse to hit the metals.. come on folks its so obvious. No other asset class gets hit.. oh accept TSY....

Thu, 01/03/2013 - 15:20 | 3119595 Dr. Engali
Dr. Engali's picture

The elections over. No need to prop things up any longer...on to the next phase.

Thu, 01/03/2013 - 15:30 | 3119657 kito
kito's picture

ohhh no doc, they are propping, and propping, and way they will stop...................until titanium columns can no longer hold the weight of their crushing insanity............................

Thu, 01/03/2013 - 17:42 | 3120114 GCT
GCT's picture

ktio I agree they are indeed propping and propping to keep these markets afloat.  I am thinking the second half of this year or the first half of 2014 though.  I think Asia is going to start dropping the dollar if we keep this up.

Why do you think 2015? if you do not mind me asking.

Thu, 01/03/2013 - 18:12 | 3120196 Room 101
Room 101's picture

Kito:  would you mind explaining why you think 2015?  You have something of a fan club that likes to read your screeds. 

But since this is ZH, I guess it would be more appropriate to think of us as stalkers than a fan club. ;-)

Thu, 01/03/2013 - 15:21 | 3119599 Boilermaker
Boilermaker's picture

Test Balloon.

Now, back to slamming the equities and, especially, the RUT higher...much much higher.

Thu, 01/03/2013 - 15:21 | 3119600 yogibear
yogibear's picture

Hmmm, gotta think they either were threatened by China or a serious negative effect for them to make an annoucement like this. It's BS because they cannot stop.

Thu, 01/03/2013 - 15:23 | 3119602 Shizzmoney
Shizzmoney's picture

They have to keep the rates low:

A) To enable the government to fund itself to pay bills for entitlements, due to it amazingly large deficit.

B) To subsidize the CDS their buddies like JPMorgan continues to take out loans for their speculation.  Everytime the Fed has eased, JPM's CDS exposure (and betting) has gone up.

If rates were to go up, and JPM's CDS' fail (which they will), then the Treasury is basically in defacto default because it is linked to these shaky debts JPMorgan has due to their bets.

It's like the Fed literally chained the American economy to a car in neutral, and Jaime Dimon is behind the wheel saying, "Don't do it!  I'll take this bitch off neutral and take you for a ride!"



Thu, 01/03/2013 - 15:26 | 3119614 Mortimer
Mortimer's picture

turn those machines back on!

Thu, 01/03/2013 - 15:25 | 3119621 devo
devo's picture

Good luck ending QE lol

Thu, 01/03/2013 - 15:26 | 3119622 Say What Again
Say What Again's picture

Seems like the NASD SNAFU happened allmost at the same time, or maybe just a little bit sooner, as the release of the FOMC minutes. Hmmmm

I know - I'm seeing ghosts, and hearing voices again.

Thu, 01/03/2013 - 15:26 | 3119624 gimli
gimli's picture

It's Whack-a-doodle PM time again.

Thu, 01/03/2013 - 15:27 | 3119628 ebworthen
ebworthen's picture

Watch 'em cut QE and raise rates and crash everything all over again.

Who won the last time?  Banks.

Watch e'm do it.

Thu, 01/03/2013 - 15:29 | 3119648 Mortimer
Mortimer's picture

cool. i'm gonna buy a house in california for $16k like my grandparents did!

Thu, 01/03/2013 - 15:33 | 3119673 stateside
stateside's picture

Silly sheep - the FED has come to learn that it's not what they do that matters it's what they say.  The Wall Street sheep get herded by the FED to wherever the FED wants them to go.  Never mind that the FED is buying 80% of the Treasuries issued and Asia has said "no mas: to more buying.  The FED must continue QE to infinity or the jig is up.  Who will buy if not the FED? The sheep may get it in time but today they are being herded as expected.



Thu, 01/03/2013 - 15:36 | 3119684 Shizzmoney
Shizzmoney's picture

I can't wait til Wall Street will realize the millennials have no interest buying stocks when we get to our prime investing ages in our 40s and 50s.

The Fed's gonna have to print up a shitton more paper to drive that volume!

Thu, 01/03/2013 - 15:38 | 3119689 lizzy36
lizzy36's picture

QE is the orginal Hotel California. Watch what they do, not what they say.

Can anyone name a government (cough central bank) that has started QE and then stopped?


Thu, 01/03/2013 - 15:40 | 3119699 ekm
ekm's picture

George Bush stopped the QE in 2008-2008, only temporarily though.

Thu, 01/03/2013 - 16:00 | 3119775 LawsofPhysics
LawsofPhysics's picture

That the same GW the signed TARP/TALF?

Thu, 01/03/2013 - 16:34 | 3119880 ekm
ekm's picture

After the crash.

Thu, 01/03/2013 - 17:01 | 3119982 HurricaneSeason
HurricaneSeason's picture

The Feral Reserves balance sheet went from $3/4 Trillion to over $3 Trillion to cover treasury bonds and buy mortgage backed securities from the banks(at 3 times what they're worth) so the banks could buy treasury bonds. They probably can't buy $4 trillion more in deficit spending during Obamas second term at the same time as freeing the banks from bad mortgage backed securities and save Europe and buy any maturing treasuries that China and Russia want to sell. If the Fed starts being a net seller of treasuries interest rates should take off making their balance sheet worthless. I would think their draw down would have to be very slow while encouraging the annual federal deficit to be at least cut in half.

Thu, 01/03/2013 - 15:39 | 3119693 sbenard
sbenard's picture

It's a Fed Mutiny on the Bounty!

It's about time!

Thu, 01/03/2013 - 17:04 | 3119992 HurricaneSeason
HurricaneSeason's picture

The Fed wants higher taxes and higher interest rates, same as Europe.

Thu, 01/03/2013 - 15:42 | 3119707 yogibear
yogibear's picture

The Federal Reserve boxed themselves in a corner!

Hey, Evans, Dudley, Yellen and Bernanke, 

Your stuck buying US debt because if you don't you know the whole gig is up. They know it and we know it.

The Federal Reserve is just doing lip service. Like Bernanke saying he wasn't monetizing when he was.

Look at what they do, not what they say.

Thu, 01/03/2013 - 17:12 | 3120013 HurricaneSeason
HurricaneSeason's picture

The Federal Reserve makes the decisions on important matters, like the $trillon bank bail out. All the banks had to say was either the banks got their money or there'd be 20% interest rates and martial law. A few in congress complained, bur Bush and Obama said nothing, no debate. This is the pre-game for the debt ceiling talks.  The banks are already holding enough debt, they just need higher rates, more taxes, lower deficit and more austerity. If they keep piling on more trillions in IOUs, it makes they're balance sheet a joke.

Thu, 01/03/2013 - 15:59 | 3119774 Madcow
Madcow's picture

Conventional wisdom = QE forever ...

But the reality is that the USA MUST DEFAULT - and the sooner the better. 

Better to go ahead and take the (short term) pain now than to suffer a long and painful dismemberment - 

Thu, 01/03/2013 - 16:09 | 3119812 centerline
centerline's picture

Long and painful dismemberment coming right up!

Thu, 01/03/2013 - 16:31 | 3119869 agent default
agent default's picture

By ending QE i suppose they mean that they will let the 10y yield go up to something resembling a real interest rate, like say 2 to 4%.  How bankrupt will the US be overnight?

Thu, 01/03/2013 - 18:21 | 3120215 cdude
cdude's picture

Let's think about that for a moment. 2% or even 4% is STILL very low and it would crush. 

Thu, 01/03/2013 - 16:44 | 3119912 Bokkenrijder
Bokkenrijder's picture

Keep on buying that fucking dip guys! Catch that falling knife, hehehe!

Thu, 01/03/2013 - 18:02 | 3120010 JonNadler
JonNadler's picture

you mean, you saps actually believe this? you mean I can use this to scare the goldbugs? I mean, eh, no yes Bernanke will stop QE and gold will collapse, mark my words

Thu, 01/03/2013 - 23:09 | 3121002 q99x2
q99x2's picture

Put em in prison for treason. End the FED.

Fri, 01/04/2013 - 06:34 | 3121394 Xue
Xue's picture

Wasn't Bernanke supposed to increase QE ''a bit''?

If the FED endS QE and zirp, the US treasury goes bankrupted.


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