Santelli To Forecasting 'Fail' Fed: "Let Market Forces Reign"

Tyler Durden's picture

While cogitating on yesterday's weak GDP print, CNBC's Rick Santelli confirmed his view that forecasting is complex (at best) and impossible (most likely). The 2010 view of the Fed was that 2012 growth would be 3.5-4% - quite a destructive miss as it turned out; and while Santelli is not attacking the Fed for its ridiculously bad forecasts, he makes a critical point. Forecasting such a massively complex and dynamic system as the global economy is foolhardy but attempting to control a few of the pieces (and not all of the pieces - which is akin to herding cats) is insane. His suggestion, "maybe [the Fed] should look at what has worked in the past; that is market forces." Indeed, two minutes of sanity...


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IridiumRebel's picture

Scream at em' Rick.....SCREAM IT!

The Juggernaut's picture

Gold to 5K.  Check out the depression of 1921.  Fucking Bernuck studied the wrong depression.

IridiumRebel's picture

Bernanke to the junkyard of history!

iDealMeat's picture

WHHHOOOOOOOOOOOOOO    HOOOOOOOOOOOOOOOOOOO..   Debt ceiling blow off.!      Buy with both fists..   Buy, Buy, Buy, Buy,Buy, Buy, Buy, Buy, Buy, Buy, Buy, Buy, Buy, Buy....

NotApplicable's picture

"Let my bond vigilante people go!"

Assuming they're not all dead.

EnslavethechildrenforBen's picture

The fed is only interested in what it can steal from the market, and by manipulating the market.

Cdad's picture

Love Santelli...but...what "market"?

Manthong's picture

“Market Forces” cannot work freely while they have any semblance of control.

It will be “game over” one day, but until then forecasting is the easiest thing in the world when all you have to do is lie and you never have to account for your fraud.  

Cdad's picture

Ummmm...the "accounting" is exactly what is about to happen.  But go ahead...I understand the nature of your comment.  Tell me what you are buying, buying, buying right now...and maybe I'll give you a fair hearing.


disabledvet's picture

it's the "got a good reason for taking the easy way out" approach. i was thinking of this scene today only "instead of great battle we have Senator Schumer telling Ben Bernanke to get to work." ON MY COMMAND UNLEASH QE HELL! (weakness and debauchery...weakness and debauchery)

Zap Powerz's picture

Market forces will never be allowed to work because if they did BB and his little club of pedophiles would be out of jobs and dirt poor and they know it.  The sweet young ass would end and then where would they be?

knukles's picture

I'm still here ....  altho nobody listens anymore.
(Been there done that, etc., ad hoc, vootie, Burma Shave, brush your teeth, quit that you'll get hair on your palms, listen to your mother, it's OK with me if it's OK with your mom.)

disabledvet's picture

exactly..."did someone just wimper free market? nothing another trillion won't solve...

Dr. No's picture

Our Great Depression is our lives...

Harbanger's picture

To Juggernaut- Good Article, most people dont even know about President Harding or what he did, never mind that he was assassinated.  The progressives have since practically erased him from history.

knukles's picture

note: the progressives have ... erased him from history...

Ah, the olde redaction scheme, a favorite of the... lefties, historically!

ACP's picture

You got that right. Just like when the Commies first took over in Russia...all the royals and their photos gone, like they never existed.

MeBizarro's picture

What a weak article since it gives no context why the severe recession/depression occurred (result in the decrease in spending from WW1 by the US gov't and the great reduction in demand from key European trading partners) or who was really running the economic show - Andrew Mellon who essentially was the key figure in the US economy until FDR got elected.  


eatthebanksters's picture

Don't forget the confidence man Geithner...

Crtrvlt's picture

But then something wonderful happened: Markets cleared, and a vibrant recovery began............But in 1922, the first full year of recovery, the Fed’s index of industrial production leapt by 27.3%. By 1923, the unemployment rate was back to 3.2%.  The 1920s began to roar........No TARP, no starving the savers with zero-percent interest rates, no QE, no jimmying up the stock market, no federal “stimulus” of any kind. Yet—I repeat—the depression ended. To those today who demand ever more intervention to cure what ails us, I ask: Why did the depression of 1920-21 ever end? Given the policies with which the authorities  treated it, why are we still not ensnared?

Silver Bug's picture

If market forces were set free, then the U.S would be bankrupt overnight.

centerline's picture

sshhhhhh.  (your not supposed to say that).

Zap Powerz's picture

I have no problem with Gold at 5k.  I would prefer 10k or 100k, but I will not be offended when it is 5k.  Just sayin.

battle axe's picture

He will scream from the roof tops, but the masses will not listen. We deserve the storm that is coming...

bdc63's picture

actually, that is pretty much the calmest I've ever seen Santelli ... is somebody slipping something into his food?

Henry Hub's picture

He has to be very careful when he critizes the FED, he want to keep his job.

knukles's picture

Matched sales...
Same thing (most of you never seen or heard of it for it's an implement to drain reserves from the system, not add and drain ain't been done in 10+ years, God help us all) as a reverse repo for all intents and purposes.  The Fed sells securities to the primary dealer at known price and commits to buying them back at some future date, known price. 

The sale to the dealers thereby drains reserves from the banking system temporarily.  The tool was utilized extensively when targeting Federal Funds was "the" policy target.  If the rate dropped too ow relative thereto, reserves were drained thereby lowering the level of "excess reserves" in the system.

Ain't seen one of those in a generation, folks.
Since everybody's only interested in flooding the system with worthless money (as in too much)
And the Fed every once in a while claims to do one for "practice" to make sure the procedure works.  Sorta like Godzilla destroying Tokyo to make sure it's still possible. 

Of fucking course the procedure works!  It's simply a sale and purchase of an obligation for settlement on different dates.


note: I was responding to tankster who double posted and deleted the one above... see below

tankster's picture

Sorry for my ignorance, but when Rick says "markets will force them to use them to match sales", who's sales?

madcows's picture

If I have voted in every election for the candidate that I thought was the most fiscally responsible and conservative, do I still deserve the economic shit storm that the Irresponsible Liberal Profligates have brought to my door?

maskone909's picture

wait but maria bartiromo said in her observation that healthcare jobs should......

ToNYC's picture

healthcare jobs will be the next welfare jobs and you won't want those diluted and deluded benefits you paid for a steal!

bobthehorse's picture

The minute Gentle Ben stops stimulating, we go into a massive deflationary depression.

We're stuck like a rat in a glue trap.

Can't win for losing.


Remington IV's picture

" Market forces "   . . . . .   on the CME floor = front-running

francis_sawyer's picture

Bernanke ADMITTING his Princeton 'Great Depression' thesis = FAIL............ = FAIL...


Party on Garth!... Party on Wayne!...

[& that he & a few other of his 'tribal cronies' shuffle out the door with a little more VIG in hand is 'extra kewl']...

LongSoupLine's picture

Rick's been reading ZH it appears.


Fuck you Fed thug fuckers

smlbizman's picture

i think when he addresses those fucked up announcements....when he says , to the effect i will have to see once the numbers are anaylized....then he waits for the hedge........and i am convinced they all read zero hedge......

NotApplicable's picture

Rick was one of the people that turned me on to ZH back in the day. Between him and a few others, I became curious as to why this site would be mentioned as their source of otherwise unobtainable info (relative to the MSM), yet always came with a disclaimer (so they wouldn't appear too supportive of Tylers' perspectives).

knukles's picture

Rick is a bond weenie.
All bond weenies think like this (or else you ain't a Bond Daddy, Vigilante or Weenie)
We all read the Hedge.

Then you ain't in the Bond Business, go back to your mom's basement


(why you think that the WS firms don't want people reading this shit?  equity pukes couldn't care... they carry the water for the koolaide)

kliguy38's picture

He knows what's going on and he also knows the ultimate consequences....He was with Drexel  in the 80's and knows how the system really works.....the game is already over...this is analogous to filing a protest after getting clobbered by 7 touchdowns.

NotApplicable's picture

Well, if you add in his ties to the Kochs, I'd say it's more like laying out the rules of the next game in order to appear relevent enough to get a seat at the table.

There will always be another game.

fxrxexexdxoxmx's picture

Obama has been sitting on Soro's c**K long enough. I wonder why NPR never talks about Soros?

A Lunatic's picture

World War has worked fairly well in the past, I'm sure Benny and the inkjets are already prepping the printer for that though.........

tecno242's picture

Bernanke knows what will happen if he releases everything to market forces. 

Of course, it's everything that needs to happen.. yields will fly up.. forcing the government to cull spending without lengthy debate, the FED's balance sheet will have to be purged, credit and economy conditions will plummet. 

But in the end, the country will be better for it.

The current path for the country is akin to a zombie just walking along waiting for its head to explode.

Spigot's picture

Oh, truly. He will keep his fists jammed on the "right choices, correct decisions" until we are all doing a GLOBAL face plant into the obvious concrete below us. His overlords and peers expect him to do this and so he WILL do it. At the very last minute he will look out from the TeeVee screen with the look of a Captain Going Down with His Ship, and say something like "I am SO sorry. But forces beyond our control have made us all victims of a great catastrophy. Who could have seen it coming?!?"