• Sprott Money
    05/26/2016 - 05:58
    How many “emergency” “secret” meetings do the central planners around the world need to have before the citizens of the respective countries begin to fully understand and take notice that something...

No Volume, No Problem

Tyler Durden's picture


Presented with no comment...


(h/t @Not_Jim_Cramer)

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Sat, 05/11/2013 - 14:43 | 3551789 HoofHearted
HoofHearted's picture

It's free, swipe your HFT.

Sat, 05/11/2013 - 14:58 | 3551835 AlaricBalth
AlaricBalth's picture

No Volume, No Problem
Where have I heard that before?
Thanks Viagra!!!

Sat, 05/11/2013 - 15:15 | 3551877 cifo
cifo's picture

No Value, no problem.

Sat, 05/11/2013 - 16:39 | 3552037 AldousHuxley
AldousHuxley's picture

when correlation amongst equities is high, just put your money in low cost ETF and let Fed do their magic.

Sun, 05/12/2013 - 00:49 | 3553010 s2man
s2man's picture

Why didn't you tell me that in 2009?

Sat, 05/11/2013 - 14:44 | 3551793 Yen Cross
Yen Cross's picture

   Parabolic $ no problem. I can just see the Q-2 earnings estimates blamed on a stronger currency. BTFD

Sat, 05/11/2013 - 14:45 | 3551795 polo007
polo007's picture

According to Bank of America Merrill Lynch:


Easy Fed policy: too much of a good thing

The costs of easy Fed policy

Fed policy is aimed at stimulating economic activity, which involves incentivizing households, businesses and investors to take more risk. Investors have obliged, resulting in low rates, tight credit and mortgage spreads, and new all-time highs for major stock indices. But some worry the Fed is causing a dangerous search for yield that could lead to new asset bubbles and financial instability. Our assessment is that Fed policy has not led to an increase in systemic risk.

Risk-taking is good; systemic risk is bad

This piece provides a guide for monitoring financial stability and the linkages between asset markets, financial institutions and the real economy. We believe the ultimate question is whether the Fed’s policies have increased systemic risk.

This depends on the following, which we address in the note:

- Do market valuations appear overstretched and are there signs of asset
bubbles forming?

- Is there an increase in leverage in the market or an overreliance on short term funding? Would systemically important institutions be at risk of failure?

- How are the beneficiaries of easy credit using the proceeds? Are they using debt to fund risky investments, buy homes they can't afford or go on a consumption spree? Or is issuance going toward improving their balance sheets and lowering their vulnerably to the eventual rise in interest rates?

Risk transfer underway, but systemic concerns muted

We argue that Fed policies have encouraged a transfer of risk from borrowers (indebted households and corporations) to creditors (investors) who are willing to accept lower risk premiums. Increased real money participation in credit markets mitigates the systemic implications of this risk transfer. Corporate and household balance sheets are healthier, thanks in part to easy Fed policy, but signs of increased appetite for leverage in the corporate sector bear close monitoring.

Fed to stay the course

Our survey of financial conditions and systemic risk supports our base case that the Fed will maintain its asset purchase program at the current pace of $85bn/month through March 2014, followed by a 6-8 month tapering period.

QE will limit the upside in yields

The potential for a sizable rise in yields will be limited if the Fed maintains QE well into next year as we expect. We forecast a gradual rise in 10y rates by year-end.

Sat, 05/11/2013 - 14:52 | 3551819 thecoloredsky
thecoloredsky's picture

Reminds me of this beer I'm drinking. Really low ABV (alcohol by volume) enough of it will get me drunk though. This market is like miller 64. Ah Fuck it. Let's get drunk.

Sat, 05/11/2013 - 15:10 | 3551868 WmMcK
WmMcK's picture

I prefer "GatorBlades".  Gatorade and Everclear (real high APV).

Sip it until drunk, then "fine tune" as needed. YMMV.

Sat, 05/11/2013 - 14:54 | 3551824 uno
uno's picture

Thank you Zerohedge for constantly exposing the fall of the empire in real time.

Sat, 05/11/2013 - 15:25 | 3551901 The Heart
The Heart's picture

When crime like this runs rampant in a society, it is not long before it falls under the sheer weight of the overwhelming corruption and crimes.

"Today Mark Mardell, the BBC’s North American editor, issued an apology for continuing to believe Obama’s lies and went on to state heads will roll."

Yeah, right. Heads will roll. There is no such thing as real justice or oversight of the out of control criminality and corruption in the systems of babylonian govt. What happened to America is a question there will be plenty of answers for in a thousand years. Right now, no one even cares.


Sat, 05/11/2013 - 14:56 | 3551825 francis_sawyer
francis_sawyer's picture

BTFD [with printed money]... Otherwise, you're 'rayciss' & 'anti-semitic'...

Sat, 05/11/2013 - 14:57 | 3551830 Yen Cross
Yen Cross's picture

   That was a good post. +1

Sat, 05/11/2013 - 15:27 | 3551911 francis_sawyer
francis_sawyer's picture

If any of you... homos... touch me... I'll kiss you...

~ francis_sawyer

Sat, 05/11/2013 - 15:53 | 3551951 Dadburnitpa
Dadburnitpa's picture

Lighten up Francis.

Sat, 05/11/2013 - 16:35 | 3552029 francis_sawyer
francis_sawyer's picture

I'm JOE BIDEN & I approve of this message...

Sun, 05/12/2013 - 09:39 | 3553349 Pooper Popper
Pooper Popper's picture
What about homosexuality, Tony? You like men? You like to dress up like a woman? What is wrong with this guy? He kidding me or what? Just answer the questions, Tony. Okay. No. Fuck, no!
Sat, 05/11/2013 - 14:57 | 3551832 AynRandFan
AynRandFan's picture

Still amazes me that the Fed was able to monetize so much debt that it completely took over stock and bond markets.  I never would have believed it before, and most of us still have trouble believing it now.

Sat, 05/11/2013 - 16:07 | 3551972 Precious
Precious's picture

Welcome to the USSA.

Sat, 05/11/2013 - 16:11 | 3551980 donsluck
donsluck's picture

While dying, most people cannot believe it.

Sat, 05/11/2013 - 16:44 | 3552047 freewolf7
freewolf7's picture

...until they do.
Steve Jobs: Oh wow.

Sat, 05/11/2013 - 18:18 | 3552191 Precious
Precious's picture

"Oh wow."  That's what a Buddhist says when he sees Jesus.

Sat, 05/11/2013 - 18:37 | 3552210 espirit
espirit's picture

Taoism: Shit happens.

Buddhism: If shit happens, it isn't really shit.

Zen Buddhism: Shit is, and is not.

Hinduism: This shit has happened before.

Islam: If shit happens, it is the will of Allah.

Catholicism: If shit happens, you deserve it.

Rastafarianism: Let's smoke this shit!

Bernankeism:  Let’s print MOAR shit!

Sat, 05/11/2013 - 19:06 | 3552248 nmewn
nmewn's picture

Now thats some good shit!

Sat, 05/11/2013 - 19:15 | 3552263 The Swedish Chef
The Swedish Chef's picture

Cronyism: When the shit hits the fan, the muppets will clean it up. And we will have thrown it. 


Sat, 05/11/2013 - 20:11 | 3552363 KickIce
KickIce's picture

Or the muppets will drown in it.

Sat, 05/11/2013 - 20:02 | 3552336 KickIce
KickIce's picture

No gold standard + dumbed down population + corrupt politicians = bankers gone wild

Sat, 05/11/2013 - 14:58 | 3551833 LawsofPhysics
LawsofPhysics's picture

Oh well, you can't book a profit without selling.  to be outlawed in 3...2...1...

Sat, 05/11/2013 - 15:00 | 3551837 Yen Cross
Yen Cross's picture

     What do you call a room full of Greeks and Cypriots?

Sat, 05/11/2013 - 15:03 | 3551847 LawsofPhysics
LawsofPhysics's picture

Bagholders who should have sold when they had the chance.

Sat, 05/11/2013 - 19:16 | 3552265 The Swedish Chef
The Swedish Chef's picture

"What do you call a room full of Greeks and Cypriots?"


A war with Turkey waiting to happen.

Sun, 05/12/2013 - 14:20 | 3553857 NoClueSneaker
NoClueSneaker's picture

Threesome ... whereby  Greeks DP ed ...

Sat, 05/11/2013 - 15:06 | 3551856 ekm
ekm's picture

Imagine a neighborhood with 10 houses and the Fed owns 9. What is the price & volume of the housing market in that neighborhood?

Sat, 05/11/2013 - 15:20 | 3551889 LawsofPhysics
LawsofPhysics's picture

Whatever the Fed wants it to be.  Now actually taking possession of a home might be another story altogether.  The latter would depend on the neighborhood.  Anyone else see the whole problem with "mark to fantasy" accounting?

Sat, 05/11/2013 - 16:55 | 3552069 Village Smithy
Village Smithy's picture

I think EKMs' point is that when such large quantities of stocks are already owned by the Fed and the PDs, if they simply do not sell then the stocks won't start to freefall. It costs them relatively little to buy up the little bit of stock that is being sold (the tenth house) and thus keep up the illusion that things are well bid. They have repeatedly proven their ability to not only kill short sellers but actually cause the market to rise by very carefully (read algorithmically) squeezing them out. IMO that is Bernanke's "exit strategy" . The Fed and the PDs are sitting on billions of unbooked profits. Bernanke has promised the dealers (who most certainly must have gone to him months ago and demanded WTF he had in mind for exiting) that if they sat tight and didn't panic sell, he would make sure that over the rest of his term he would allow them (using taxpayer money) to book these profits. If we don't see a big sell-off this week I will be even more conviced of this. If the market was widely owned (as it should be if it were actually operating freely) every investor with any knowledge should be realising this weekend that the pump job is ending, and then racing for the exit on Monday. But they won't cause it aint.  This should be the proverbial "everyone to the other side of the boat" moment but I will be shocked if by Friday we aren't green on the week. This was not a monetary policy experiment it was a market manipulation experiment. If we are lucky at best it will have only cost our country $ billions in future debt and done nothing to create jobs. If Bernanke can't control his exit strategy who knows what will ensue.

Sat, 05/11/2013 - 19:58 | 3552327 ekm
ekm's picture

The collapse will start when Primary dealers are scheduled to do swap losses payouts.


Also, since there's no one else to buy those stocks from PDs, they will be unloading most of those securities to one or two PDs, wrap a rope around them and throw them into the ocean.




That's what happened with Bear Stearns, with Lehman, with MF Global.

Sat, 05/11/2013 - 23:29 | 3552893 Zigs
Zigs's picture

And, our politicals fiddle while Rome burns.

Sat, 05/11/2013 - 23:29 | 3552894 Zigs
Zigs's picture

And, our politicals fiddle while Rome burns.

Sat, 05/11/2013 - 19:17 | 3552266 The Swedish Chef
The Swedish Chef's picture

"Imagine a neighborhood with 10 houses and the Fed owns 9. What is the price & volume of the housing market in that neighborhood?"


Zero, of course. Who the fuck would want to live in that neighborhood?!?

Sat, 05/11/2013 - 20:10 | 3552359 KickIce
KickIce's picture

Might as well kiss private property ownership good bye, they'll rent to you as long as you play their game.

As far as theone remaining owner, if they can't get it from him/her, they'll get from the children or grandchildren.

Sat, 05/11/2013 - 20:32 | 3552407 ekm
ekm's picture

I was using the comparison as a way to show that the Fed + primary dealers own most of stocks if not all and of course a huge chunk of bonds.


However, the basic line is correct. This is what QE is:


QE is government ownership of means of production (we used to call it communism).

In reality the Fed/Gov own 9 out 10 houses in USA and yes it means to kiss bye bye to private ownership ...if it continues.

Sat, 05/11/2013 - 22:11 | 3552683 KickIce
KickIce's picture

And if you add the properties listed on central bank's financials, the situation becomes even more dire.

Sat, 05/11/2013 - 15:29 | 3551914 electricgorilla
electricgorilla's picture

Sat, 05/11/2013 - 15:42 | 3551928 Motorhead
Motorhead's picture

Come on, stock market bubble makers, get on the stick!  The gum'ment needs the capital gains to fill the tax coffers.

Sat, 05/11/2013 - 16:08 | 3551971 Yen Cross
Yen Cross's picture

  Who needs volume, when you have a closed loop? I hope you guys like this song.

  Oingo Boingo Dead Man's Party - YouTube

Sat, 05/11/2013 - 16:40 | 3552039 Tulpa
Tulpa's picture

Maybe I'm just stupid or something, but I don't understand what the difference between "Volume > 1 Year Avg" and "Volume < 1 Year Avg" is.  This is one of those times when I wish the chart were presented WITH comment.

Sat, 05/11/2013 - 18:41 | 3552151 One World Mafia
One World Mafia's picture

Volume > (greater than) 1 year avg. Volume < (less than) 1 year avg Compare the magnitudes (y-axis) to see that low volume predominates as time advances. Low vol is past the 2800 mark today. When the graph begins in 2010 they are the same magnitude.

Sat, 05/11/2013 - 18:54 | 3552235 Socialized Losses
Socialized Losses's picture

@Tulpa Don't worry about this chart.  I suspect it has been assembled by some "goal seek" trained statistician aka an economist.  It's designed to make you see something that "may or may not" be there. To use an economist phrase. In the end the caption should read "this chart presented without comment and without relevance".

Regardless, the authors et al of ZH do a bang up job & I appreciate all their efforts and dedication. I'd nominate em' all for a Nobel Prize in Free Speech but that would just be a slap in the face to them.

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