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Jon Hilsenrath's 589 Word Instanalysis Of The Fed Minutes
It took the WSJ's Jon Hilsenrath, who one more time is modestly relevant in a world in which QE is implied until infinity or until the Fed loses all control of the money creation process, 12 whopping minutes to release a 589-word article analyzing the FOMC minutes. At least we know one of the people who had the embargoed version hours ago. We are confident he did not leak their content to anyone. Hilsenrath's prepared take: "A new fault line has opened up at the often-divided Federal Reserve: When to halt the bond-buying programs that are adding $85 billion a month of Treasury and mortgage securities to the central bank's assets. Minutes of the Fed's Dec. 11-12 policy meeting showed that officials were divided about when to halt the programs, with a few wanting to continue them until year-end, several others wanting to end the programs well before then and some wanting to halt them right away. While exposing the rift, the minutes left little clear indication which course the central bank would choose. In its official policy statement, it has been saying since September that it would continue the bond-buying programs until the job market substantially improves... It is a hugely consequential decision for the Fed and likely the next big challenge for Ben Bernanke in what could be his final year at the helm of the central bank, where he has been chairman since 2006."
The rest is just as expected and can be read here, all of which is hollow rhetoric to telegraph a "responsible Fed."
All we can say is "good luck Fed unwinding this":
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I feel like the so called elite of the world are my cattle animals, and they're there for my entertainment enjoyment. It's funny they never get any rest these days because they have to be constantly jumping through hoops to try to keep their monetary system from crumbling. They also have the most hilarious demonic characters in their fold for me to make fun of. If I didn't have them, I'd have to find different avenues of enjoyment to entertain me.
Free Jon Corzine!!!
Nothing is going to be unwind. The Fed's job is to help sustain the system as long as possible (max potential upside) before the ultimate conclusion of the equation (max potential downside) takes place. Once max potential has been hit, nothing the Fed can do than to sit and watch with everyone else. The Fed's job is convince the sheeple that the helicopters are coming to save them.
The system is barely generating new credit at this time, even after the mother of bailouts.
The Fed is leveraged 52-1 with low interest junk. WTF do you ZH financial brainers think the MF’s will do.
swallow.
I would have to pose a question to the "hawks," um, wtf exactly is your solution to this basic MATH staring you assholes in the face?
I cannot fathom their even considering ending the programs when to do so would collapse the ENTIRE credit market immediately. Seriously. It'd be like that day that Reserve buck-broke except over with even quicker.
There isn't any money market anymore except for CB lending. If they end these programs, the USG goes tits-up immediately and the entire monetary credit edollar complex seizes up completely. They'd have to reverse course within an HOUR. The major MM run in 08 was going to take us apart in about a day. You better have paper cash if they try it.
Smoke and mirrors for the sheeple to talk about.
Check out the BOE on it's "inflation target" if you want a really good laugh.
The whole charade actually IS the new normal...
Why wouldn't they centrally plan the "minutes" like everything else? On a scale of difficulty this is a pretty easy one, and look at the impact on "perception". Gold tanking.
People, you are really stupid fools.
Until now, the FED has done everything to destroy the US economy and welfare of American people. The FED promoted & rewarded fraud, dishonesty, inefficiency, perversion, welfare, and parasitism.
The FED was lying about almost everything and, now, you are ready to believe in their co-called “Dec. 2012 minutes?” WOW, you are imbeciles!
The FED just cannot stop printing fiat money. The US and EU economies will collapse in a matter of weeks after the printing stops. There will not be any money to pay all these various government employees and law-enforcement officers leading to economic collapse and anarchy. The USA is not a totalitarian country yet. It is not ready for an economic and social chaos.
done
Do you have a problem with a privation bank run for the profit of its privation owners?
Yep, privation and private mean the same thing, if you study your Latin etymology.
Private - privation - privilege - privity - privy
University of Hull
http://slb-ltsu.hull.ac.uk/awe/index.php?title=Deprivation_-_Private_-_p...
Isn't privation enterprise grand?
So a bank is essentially an outhouse, them Latinos were quite prescient.
Privation enterprise, it's the shi...defecationem!
IvyMike. You're such a upshot knothole.
Your wit has got you invited to my Castle Bravo for a friendly drink.
To get Fall-Out drunk no doubt. And get into fistfights with angry Japanese fishermen.
Mike are you a Greenbacker?
My father was on Enewetak during the preparations for your namesake.
That would have been quite the show.
Easy there, Pvt.
And when privation is in decay, retrograde, corrupted or whatever you want to call it, you get deprivation, or depravity (they are the same thing), which is what we have now.
Privation and deprivation are identical. The prefix de- means 'thoroughly', 'completely.'
Prefix
de-
Meaning reversal, undoing or removing.
http://en.m.wiktionary.org/wiki/de-
Incorrect.
For deprivation:
The words based on deprive (with the prefix de-, 'thoroughly', 'completely') are recorded further back in English than 'privation', which had the same meaning (and is closer to Latin pr?v?re)...
Deprivation - Private - privation - privilege - privity - privy
University of Hull
http://slb-ltsu.hull.ac.uk/awe/index.php?title=Deprivation_-_Private_-_p...
Sorry, can't weasel out of it, dude.
Deprivation = privation.
By your own reference too, which you conveniently skipped.
de-
2. Intensifying.
Mkey, there is no such word as "PRIVATION". but ther is a word called "PRIVATIZATION". :-)
Also, "PRIVATE" refers to status, whereas "PRIVATIZATION" refers to a process. Subtle (too subtle?) but important distinctions.
pri·va·tion
/pr??v?SH?n/
Noun
A state in which things essential for human well-being such as food and warmth are scarce or lacking.
The loss or absence of a quality normally present.
Michaelwiseguy, it took you 3 minutes to write that 81 word comment. I think Tyler obviously leaked the post to you in advance.
Fess up.
Timing is everything. Watching the antics of my barnyard cattle animals like the House of Representatives today is hilarious.
Could Michaelwiseguy = Jon Hilserath? Inquiring minds want to know if Jon had also prepared his ZH comment beforehand.
Would you stop inter-breeding them into complete mental defectives please?
Not to mention the 1 minute it would take to read the post plus another 2 to click through and read the linked article.
I can totally relate
Geithner says he's leaving by the end of the month on the heels of the FOMC questioning their need to print. I swear you just can't make this shit up!
Did he say before the end of the month - I thought it was before March?
DavidC
Time for Kyle Bass to start up his "Finance minister"index, this time for the USSA
Minutes of the Fed's Dec. 11-12 policy meeting showed that officials were divided about when to halt the programs, with a few wanting to continue them until year-end, several others wanting to end the programs well before then and some wanting to halt them right away.
Here comes the Night of the Long Knives.
In the meantime, the printing will continue until economic morale improves!
Want to and Able to are two different things. We are past the point.
Apparently some committee members didn't get the stock/flow memo.
Very good point; especially in Washington Think. I said, "I didn't want to"; see it's right here in the commitee records. Could be just covering your ass; protecting your image. As far as I can see discontinuing the feeding would have a similar effect to discontinuing the feeding of a one week old baby; but I don't know anything for sure.
They will never ever stop printing...unless of course we discover a new energy source and this economy grows batshit crazy, either that or aliens loan us a few trillion to fund a 1.5 trillion dollar deficit.
The iPhone 6 will be able to power your car and home using that floating element from the Avatar movie.
Unobtainium. ....What a ridiculous name.
We have yet to discover Reallyhardtofindium (tm)
So they want to end the same program they just doubled down on. Sounds good.
They will never ever stop printing
Since they cannot stop, it seems to me they are starting to believe they are not printing enough.
http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/9773911/Stocks-to-soar-as-world-money-catches-fire-Calvinst-Europe-left-behind.html
So thinks AEP, this may be their only chance to get out of this mess.
I expect a "decent" economy for about 2.5 years. Summer/fall of 2015 will be a replay of 2008. Except this time there is no one to backstop the Fed.
Txs, sschu
Interesting to see the 10 year bond sell off as equities fall...
Interesting to see silver get fucking gang raped out of nowhere. I should go buy some more before I commit a random act of violence.
Oh get your head on your shoulders. If you can't handle this little swing, how are you going to be able to handle a world without fiat and everyone around you freaking out because their life savings are wiped away and government can no longer print up resources to save the day?
But yes, you should probably buy some more.
Daisy...Daisy...
http://www.youtube.com/watch?v=hchUl3QlJZE&feature=fvwp
.
Hello, Dave. You're looking well today.
http://www.youtube.com/watch?v=tgI7kIkwca8
Stop Ben,.....Stop.....Stop.......will you stop Ben?
2001: A SPACE ODYSSEY meaning of the monolith revealed 1 of 3
http://www.youtube.com/watch?v=P95NWAHWLrc
.
Secret Space Program: Peter Levenda [Full Length]
http://www.youtube.com/watch?v=Cj2qrl6Q2rk
.
?
I can't believe how many fund traders are so god damn stupid not to see, ok, so if they stop QE, what happens to interest rates and service costs on the nearly $16.5T in debt. Oh!, ya, I guess they won't stop printing. Hmm... more smoke and mirrors and jawboning misdirection. In fact I wish they did stop, this afternoon. This charade would end by tomorrow morning. Besides the resulting implosion on the Fed's balance sheets as treasury prices plummet, it would finally, perhaps, force Obama and Congress to reign in spending programs as the discipline enforced by interest rates shooting through the roof force them all to start behaving like adults minding the check book, OUR check book.
Actually, the result would probably be confisticating your check book.
...which also destroys the economy.
Seems like everywhere is just one election away from Mugabe
Yep. Seems to me there is no way it can stop or the bond bubble will quickly burst, along with the stock and housing markets as interest rates scream higher. It came off to me as a bunch of BS smoke and mirrors and jawboning misdirection, as if the fed has a choice without markets imploding. WTF?
How many more times - it's NOT REIGN, it's REIN, as in reins on horses, that's where the phrase "reining in" comes from!
DavidC
I think maybe three more times.
Hang in there..
Kinda like laws... if only we can pass one more... then we can get everyone to behave.
Stoploss,
Thanks, that made me laugh!
DavidC
yep, me too. usually don't that one wrong.... grammer kops out their everyware.
Wow. Thank God you are with us. Huge value add right there. Rain / Reign / Rein....whatever.
Your avatar looks like a homo as well BTW.
Why?
DavidC
It would be an "Oh crap" moment. They realize it. They realized it from the start of the debt purchases.
A massive devaluation of the currency is their goal. They decided that years ago.
They no longer have the option to do anything else. Their past the point of return.
The case for holding physical assets continues to strenghen as does the case for not trading with leverage in the markets. Look at those precious metals charts. Its almost as bad as... well... every week since the Swiss pegged to the Euro...
I'm starting to wonder if they can hold gold under $1700 right through a massive debt ceiling raise and credit downgrades.
as much as I agree, in the face of that my precious silver is getting the garvin stomp. If anyone can tell me when it is time to hold these assets, I'd be most appreciative.
The Fed: If we don't, who will (at least until it's the law of the land that 100% 401k/IRA/pension investment in Treasury issuance).
I personally believe this is more likely than people believe. It fits a pattern of what Governments do when their overspending puts them in an untenable position. I would like to see people cashing out these IRA's and putting the proceeds in something solid. You can practically write the news item yourself; "dear citizens, it is all of our duties to help out our government in these difficult times;"--etc.etc.. Been done many times before.
I can't get mine out or would have a few years ago!!!!!!!!
Try harder; explore the issue carefully; I've been told there is usually a way.
I don't expect it to be 100%, but the negotiations will start at 25-30 with escalators based on income.
There is no truth to the rumor that Hilsenrath has been seen with a bright orange ball in his mouth running out of the back door of a building on Constitution Avenue.
Oh, they'll keep printing alright - as long as they get to stuff it in their own pockets.
How stupid do these idiots think we are. Yup, they are going to stop but they have a digit wrong, they meant 2023. LOLOL Amazing.
Ongoing, perpetual discount window operations are unprecedented. Either success or failure of the process ='s failure.
If successful the Fed (and others) crowds out private sector lending and creates a commodity money 'corner' that leaves the central bank subject to a squeeze. Remember, the Fed is only a conduit between private lenders and ... other private lenders (and the Treasury which itself is a conduit to private lenders and tycoons).
If a failure, why bother? More credit is counterproductive, more-more credit is even more counterproductive. When the central banks are ignorable, what happens next? More than likely an unstoppable depositor run and a shortage of currency as in 1933. What happens after that?
We would be in an unexplored quadrant of the debt-money universe ... likely massive repudiation of current debts and system insolvency with a discredited government leading to a constitutional crisis.
This is something outside the control of the central banks, it could happen tomorrow and there is nothing the Fed and others could do about it ... they've shot their wad.
:)
@steve from Virginia
Loved reading this analysis. You should post more often.
Steve's brilliant analysis lives here:
http://www.economic-undertow.com/
@realtick
Thank you. I nominate this link for the "Zero Hedge Reads" blogroll.
I agree!
I like it too; but I didn't understand the part about the consitutional crisis; what's a Constitution? Do we have one of those?
New game called "let's pretend we are solvent and illiquid," while the reality is that they (we in the US) are irrevocably insolvent and drowning in liquidity.
Stawks down.
Earl down.
Bawnds down.
Barbarous relic down.
Quick - capital, take flight!
They would continue the program until the labor market improved", September. that was before the Election. Now, it doesn't matter.
Ben BernanQE will leave just as the house of cards is about to implode? What overly ambitious dumbass would succeed him here? FYI - it didn't work out well for Lady MacBeth.
"What overly ambitious dumbass"
They would only need to be a dumbass if they actually think they can turn it around. There are plenty of self-serving non-dumbasses who would see Bernanke leaving a lot of perfectly good money on the table, and would take the job just to get the last trillion for their own uses.
You thought we had criminals now? Really? Well the real actual criminals are on their way. Watch Jon Corzine make a move.
100% SPOT ON.
Picture yourself in charge of the Federal Reserve with a 90% off sale going on in the equity markets and the unrestricted RIGHT to create hundreds of trillions of dollars to help your Bankster (and other) friends purchase all energy, technology, agriculture, mining, land, defense etc. companies for next to nothing (control of the planet) and in the process totally obliterate the value of all of the tens if not hundreds of trillions of debt that is currently strangling the global economy in the process.
I'll take the job in a heartbeat.
There's going to be a long line at the try-outs for that one :)
Good thing there are no overly ambitious dumbasses in the DC area.
That's going to be some kind of a job opportunity alright; wanted, Captain of the S.S. Titanic; sailing immediately; no experience required. The mind boggles.
Yes, well I need to learn how to fly a Boeing 767; but I don't need to know how to land. so how much would the training fees be?
Very reasonable, but training for 270 degree turns while descending to ground level without disturbing a blade of grass at 500 knots is extra!
Same exit strategy as Maestro Greenslime.
Then they get to cash in making speeches, defending their role in bringing on the horror-show that they bequeathed us.
Maybe this time around, the bad guys won't get out of town before they're hung.
Hilsenrath didn't write that - someone wrote that for him.
China has a great entry point for moar xau later. It pinged right off the 200 day avg. and Chinese markets were closed yesterday.
QE to infinity - that's all they know, that's all that will be done...
Re: "it has been saying since September that it would continue the bond-buying programs until the job market substantially improves"
Tyler, you have misinterpreted what the Fed (Bernanke) actually said in September (confusing not raising interest rates until the job market improves with the bond-buying).
6.5% unemployment is a condition for raising interest rates (not to stop bond buying, as most Wall Street and ZeroHedge misinterpreted).
Do not panic, the true fest on Gold is when nominal bond yield keep rising but keep being behind inflation. THat is the inflation fest starting, so far we had the currency devaluation fest only.
Yeah, it might actually take that long; but that will be some kind of end point, alright. Because, that'll sure as hell get the attention of the really wealthy; the kind who have real financial advisors, that they didn't find in an internet page support ad.
Exactly! would luv to see gold sell off to the 1300ish area on the wrong idea that rates will crush gold. Then watch gold stablize then begin a parabolic rise as it becomes apparent that gold has detached from the fiat paper games regardless of what treasuries do.
Real rates is what matters, and steepening the yield curve makes the real rate today flat (not great for Gold today), but will create sticky inflation in 9 months. Then real rates go right back negative and that is good for Gold. But then the masses will buy Gold when ~INFLATION~ makes the headline while Gov Debt to GDP goes down.
Rates were going higher and higher during the 70s, but real rates kept being negative. What killed Gold in 1981 was not deflation or recovery of depression but positive real rates.
Exactly correct. And one of the very few times I've seen anyone actually say this on the Internet. It's crucial to understand the difference between "higher rates" and "positive real rates"; and these later are completely out of the question now; it isn't going to happen; because it's impossible; and impossible things don't happen; and that's why if you have a five year time line, for instance; the PM's, and IMO, especially, Silver, are like guaranteed. It's already baked into the cake. As a wise man once said, you make your money when you buy, not when you sell.
What's the feds p n l today?
Those who dumped their miners this afternoon. So sad. I took some off their hands. How can any investor believe the crap spewing forth from the inmates. I just do not get it. Are they that dumb?
This is total bulshit, again, just to give the appearance of a functional fed.
Only Obama has the power to call that shot.
What are you talking about? Other than the ability to animate a teleprompter, Obummer doesn't have any power.
Again, and again.
What I mean is that only the president has LEGAL POWER to stop, whoever is the president.
587 words too many.
Gold bitchez!
Graham Summers says QE3 and QE4 are phantom, that the actual fed balance sheet is lower now than it was a year ago. I don't know what to think. He's eating onions, spotting dimes!
It is what they do that matters. Not what they say. They will never stop QE. It was going on before 2008. All they did was ramp it up. Their only regret was letting the public know.
Who will buy US bonds with rates at 2% and debt at 17Trillion? Answer is NOONE! This is another game by this liars to take the markets lower, especially Gold because The COMEX cannot come up with enough physical gold to meet demand. The Rothschild’s have lied one to many times for anyone to trust or believe their decedents!
Printing and Can Kicking, the dream combo. No recent history they do not work. None. Japan's been at it for 20+ years and their standard of living is still Top 10. If Japn can do it for 20+ the US should be good for 30, 40+.
If you think anything else you're a dreamer.
Well, we're all dreamers to some extent. In my dream the US is not Japan; apparently, in your dream the US is Japan; I find this a little odd; but then, it;s your dream. I'm a grown up I'm willing to take the consequences of being wrong. I have a little trouble dreaming that a country with an enormous current account defecit and IOU's out all over the world, to an enormous scale, is somehow going to work out like Japan; but as I say, that's just a problem I have with my dreaming.
America wishes it could be japan.... this can kicking will not last two decades... I guarantee you that
So when are we going to see the next QE announcement? I was thinking early Feb.
some just do not get it money printing has not stopped
so read the minutes and snore .. what a waste of time and energy
the politicans lie the fed is a working group of private bankers running the table of all wealth
589 words used when none would be better
A tax of $85 billion each month, to be shared by all users of the US dollar. For what? To bail out institutions who made bad investments in MBS.
The housing recovery is a myth. It is just a perpetuation of more cheap money care of MBS purchases.
When will the Fed learn?
Propaganda to convince the markets that the Fed is not going to print to infinity.
If there isn't ambiguity, then the entire market will pigpile the trade...
Ben Bernanke is NO Whip Whitaker:
http://www.youtube.com/watch?v=xnVNNR6CEOE
" At least we know one of the people who had the embargoed version hours ago. We are confident he did not leak their content to anyone."
Hilarious Tyler.
I believe that the Fed's message (delivered by short panted (with zippered ass) Hilsenrath), is a shot across the bow of Congress. Congress has to put spending cuts on the table BEFORE the debt ceiling talks begin.
Expect ES to correct the allowable 2 to 3 % over the weekend (after the made up Unemployment figures tomorrow.)
I ean they have to maintain their "credibility"....equities cannot go straight up...'cause that would cause a bubble....ahem
No need for more QE bond purchases now that the Kenyan Keynesian has been re-elected. I thought they would at least wait until the swearing-in ceremony.
So who would buy all the debt we have to issue for our massive defecits if the Fed is forced to stop? The Obama Fiscal Cliff deal only cut a sliver of defecit.. They would have to raise rates to attract buyers...They can't afford to raise rates since they owe almost 17 trillion and higher interest cost would add to the defecit. They are trapped. Me thinks this is jawboning.
Hate to see such a beautiful thing as gold get slammed around by morons.
When to halt the bond-buying programs that are adding $85 billion a month of Treasury and mortgage securities to the central bank's assets.
Always and forever will be about the FLOW, not the STOCK.
Halt the flow = PAIN.
Here is my 4 word analysis of the fed minutes:
GOD HELP US ALL.
There has been a 50% downward revision to my 4 word instanalysis.
revised:
WERE SCREWED
Check out this short video of Hilsenrath... aka The Gimp: http://www.youtube.com/watch?v=S8kPqAV_74M
MSM spin of the day - courtesy of CNBS
End of Stimulus? Behind Fed's Surprise Statement http://www.cnbc.com/id/100352748
Case Study: How to create hope and confidence in a collapsing economy.
Problem - people are seeing that the endless rounds of money printing are not working - they have no jobs - 1/5th of them are now on food stamps - they are no longer believing the headlines
Solution - since everyone knows the only weapon the govt has left is money printing - and money printing is not working - announce that some in the govt/Fed expect money printing to stop - perhaps as early as next year
Interpretation by the Masses - oh this is good - the money printing MUST be working - and if I only wait another year or so then everything will be back to normal - because if they are saying the money printing will stop that means in one year there will be the long awaited recovery
Reference Edward Bernays for more on how to control the masses...
The commercial banks own the stock of the FED (of which they get paid 6% on). Now that the Bernank is bankrupting the FED by buying worthless crap the member banks aren't so keen on the idea. Imagine that.