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Bank Of England's Haldane: "We've Intentionally Blown The Biggest Bond Bubble In History"
The Bank of England's Andrew Haldane is not a man to mince his words (see here and here) but perhaps the excess truthiness in his latest testimony to British MPs may have many questioning his ability as a central-banker (unable to lie when it is required). "Let's be clear. We've intentionally blown the biggest government bond bubble in history," Haldane said. "We need to be vigilant to the consequences of that bubble deflating more quickly than [we] might otherwise have wanted." As Canadian Carney steps into the BoE head shoes, it seems Haldane has some (indirect) advice there also, as The Guardian reports his comments that the committee had not been "entirely free" of political interference during the crisis; and that he hoped to "improve decision-making," in a less hierarchical, more diverse, somewhat humbler organization." The "biggest risk to global financial stability... would be a disorderly reversion in the yields of government bonds globally." he said, adding that there had been "shades of that" in recent weeks.
Via The Guardian,
A key Bank of England policymaker has warned of the risks to global financial stability when "the biggest bond bubble in history" bursts.
In a wide-ranging testimony to MPs, Andy Haldane, Bank of England director of financial stability, admitted the central bank's new financial policy committee is taking too long to force banks to hold more capital and appeared to criticise the bank's culture under outgoing governor Sir Mervyn King.Haldane told the Treasury select committee that the bursting of the bond bubble – created by central banks forcing down bond yields by pumping electronic money into the economy – was a risk "I feel acutely right now".
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"If I were to single out what for me would be biggest risk to global financial stability right now it would be a disorderly reversion in the yields of government bonds globally." he said. There had been "shades of that" in recent weeks
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"Let's be clear. We've intentionally blown the biggest government bond bubble in history," Haldane said. "We need to be vigilant to the consequences of that bubble deflating more quickly than [we] might otherwise have wanted."
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Haldane said the FPC was on alert to any bubbles created by the help to buy mortgage guarantee scheme for first-time buyers and house movers, stressing the scheme should be temporary. Referring to the US, he said: "Fannie Mae and Freddie Mac were temporary schemes and 75 years later they were still in place and blowing the world up."
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Bank of England to spot the next financial crisis, had not been "entirely free" of political interference
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SEEING THE REVELATION!
Very bombastic.
Yeah, we know. Your collateral ain't worth shit.
I'll loan you a few frn's on the crown jewels, but I get to hold them.
oh, those family jewels.
that's funny as hell....
How long will this guy survive after Carney takes over? My guess is he will be out by the end of 2013. Central, Banker and Truth are mutually exclusive.
He may be delusional enough to make the grade. He's worried that a bubble in bonds will deflate more rapidly than they would want.
How many bubbles have you seen deflate in an orderly fashion?
Deflate?? Junk bonds perhaps will deflate. But what Central Bank will let the Treasury Bond bubble deflate?
"How many bubbles have you seen deflate in an orderly fashion?"
Does very quickly reflated with gazillions of printed dollars count?
(Or is it gOzillions, you know, like Forest Gump would say?)
Coincidental to the biggest bond bubble, Mother Nature is blowing the biggest moron bubble.
+55 Fred.
Nikkei is deflating in an orderly manner, though. 6% a day, every day is quite orderly.
its tough being a hedger.....we already know,....were just waiting for the fat lady to stop singing
when are these pencil necks gonna learn, after you blow, it has to go somewhere!
cough
NSA Haldane. Find out where he has placed his personal investments.
Good for a +1 q.
This article gets a big DUH AND A YEAH THINK
What's the problem just make the pension funds buy the bonds and make it illegal for anyone to sell them. Confiscate all retirement account and give them an "annuity".... how is anyone expected to buy anything without low rates. Anyone who sells or doesn't buy would be unpatriotic.. plus I got the big screen I'm looking to finance. http://tinyurl.com/lq63ahd
The mainstream media is a bit late to the party. The blogosphere has been calling a bond bubble for quite some time.
http://dareconomics.wordpress.com/2013/06/12/around-the-globe-06-12-2013/
So....Now...when the bond markets turn the CB's will become black holes and be forced to buy every last one right? Or do we go no bid?
(truthiness) ^ 2
Another scare monger. OMG the crap is constant now. Show me mother fucker. Show me. Show me double digits on the 10y. Stop flapping your gums and show me mother fucker! Fear monger, oh yeah, sell your bonds cheap to gollum sachs people. The sky is falling! The sky is falling. hahahahahahah!!! http://www.youtube.com/watch?v=pC_XT-HdBvE
Japan is having quite the session....
Wasn't it just the other day they tried to get their pension funds to sell bonds and buy stocks? Oh yeah, they care so much about the sheep. Just another pump and dump. Always the pump and dump.
All these countries claim to desperately want inflation. Print that money and send out checks to everyone. They will have an inflationary wet dream. Yet they just keep giving it to the banks....
*shhh* its actually a coup d'etat in paper form. no blood, good slaves
Yes!!!! The Nikkei index is down ONLY about 4%!
Hitting GS stop probably
But, but, but the US just added another 42,000 jobs this week.
It was funny as hell today. We had a wholesaler in and his firm was pushing the Japanese markets. I asked him " you mean you would put money to work in Japan today even though they seem to be backtracking and drew the line at USD/JPY 101 and that their bond market trades limit down if they cross that threshold ?" And his response was " yeah the BOJ has been authorized to buy more than just JGBs. They can go into reits yada yada yada blah blah blah."
Oh well the free lunch was good anyway.
****POP****
The "biggest risk to global financial stability... would be a disorderly reversion in the yields of government bonds globally." he said, adding that there had been "shades of that" in recent weeks.
Too bad it's gonna happen... which was the goal to begin with.
Woman's bank accounts debted $300 million by Ga Dept of Revnue:
"It was when Wiley saw the 'See Cashier' read out at the gas pump that she decided to check her bank account on her phone and that's when she got the first bit of bad news.
She was in the red about $100 million dollars. Her computer at home confirmed that and more.
"Yes. $100 million from my savings and $100 million from my checking," said Wiley.
And overnight, like a nightmare, things got worse.
"I wake up the next morning, check again. Maybe this is a bad dream. It's another $100 million, so it's $300 million I'm having a problem with right now," she said.
Sun Trust Bank told Wiley the problem was with the Department of Revenue. The DOR, per law, cannot comment on any individual taxpayer, but did say it has no documents showing the department is in the wrong."
It turns out a used car Wiley bought back in 2004 may be coming back to haunt her.
"They're telling me it's the remaining balance of a sale. A $274 sales tax," Wiley said.
But how $274.62 becomes nearly $300 million is anyone's guess."
http://www.wsbtv.com/news/news/local/woman-says-bank-problem-showing-her-300-million-de/nYJ6C/
Okay that's fucked up. Too bad it wasn't hundreds of millions in the other direction.
How did the gubbermint get her bank no.'s?
Probably donated to a Tea Party at some point.
Either the NSA troll or the IRS troll is junking you..... Or it could be your perma-junker.
Its my perma-junker Bringin It...he's very dependable ;-)
I think at first you gotta be thinking "Ok, calm down....it's a hundred million, I can work this out". But the second hundred million is probably when you start to get overwhelmed.
War on women. Maybe it was her bumper sticker that had a picture of Obama and said: "Does this ass make my car look too big?"
Lol, humor award of the day (week?) for that one.
<- UST 10yr above 4% by end of year
<- UST 10yr below 4% by end of year
Shalom will shoot a load of fed jizz to manipulate it down.
They can't let it go up with half of wage earners paying no tax.
Hey!...(Krugman says)...lets give a tax credit to those who buy bonds!!! ;-)
Sounds like its "cover you ass" time.
omg this doesnt look good. deflating the bubble will b bad for all assets classes (including gold)
the real economy is irrelevent the banks must b feeling rescued and secure.
finally cash will b king.
Gold has been the Canary in the Coal Mine for the last 12 years...and has already dropped sigificantly. It should outperform everything when it all goes bust.
We fucked it up, it is clear we fucked it up, and now, you know that we fucked it up.
Here's how we're going to fix it...
He's just now figuring this out?
Relax little sheep. Everyone always gets a bailout. You too, Pimco.
I am thinking of a rubber band that has been pulled to the max for 4 years. Boing
Nikkei -422
What the hell did they forget to do over there, import their raw materials before lowering the yen. Maybe they'll get right this time round.
When you are a the kind of position this guy is in, that level of truthfulness will get your airplane flown into the side of a mountain.
Yes you intentionally blew the biggest bubble in history, and when it pops you'll roll out a new world currency in response to 'cure all of our problems'. Which you and your ilk created by the way.
He'll just have to gas up the Gulfstream in the NWO currency instead of Pounds.
"We need to be vigilant to the consequences of that bubble deflating more quickly than [we] might otherwise have wanted."
Anybody with an oz. of sense knows that the selloff, when it begins in earnest...will NOT be orderly.
Who wants to be last out, etc.
The sheep who have their life savings/retirement in Uncle Sam's bonds will be slaughtered. Serves them right for paying so much attention to the Kardashians.
And then after the big boys are bailed out the sheep's 401k money will be forced to hold a (high) % in T-bills.
People who put their life savings in Treasury Bonds will NOT be slaughtered unless they sell the bonds before maturity. Virtually all ordinary savers hold all bonds to maturity, usually on Treasury Direct. Only bond speculators buy and sell bonds when the price wiggles up and down.
"The sheep who have their life savings/retirement in Uncle Sam's bonds will be slaughtered."
Well, yea, but not from any bubble bust, more like currency bust.
You can smell these fuckers getting ready to blame the politicians for the coming collapse. Maybe that's why the worm has turned for Obama. Only banks are too big to fail.
Smart comment. According to your theory, with Mitt it would have been a lot smoother, and would have been a lot easier, but the outcome would have been the same.
I've been waiting a while for someone to say it though. I can imagine that 9% popularity is going to sting a little.
Sounds like a messenger for his masters
Gotta love the all seeing eye logo
http://www.youtube.com/watch?v=7rloOWtNeRc
You'd think the Illuminati could have afforded new upholstery since the 1970's.
Is thiis guy related to the noted evolutionist/atheist JBS Haldane? Interesting; maybe we should consider giving the USA back to the Brits.....
2008 Part Two.
If you haven't sold your house yet you missed the Spring rush and the low rates.
Next Spring might be too late, but if you don't want to get it on the market this Summer, you'd better sell by next Spring.
Yep, you might be right, and I suspect Ocare might be the hammer, lots of folks will feel hammered certainly.
This is all just theater....I could care less if the banker-owned governments lower rates to zero and borrow to keep the system going...BUT...NOT A SINGLE BANKER, POLITICIAN, WALL STREET WHORE ETC ETC WAS SENT TO JAIL since this all started back in 2008.
Totally sickening....and the creeps never lost a bonus through it all. Bonus....for what? For tearing apart an entire civilization??? I wonder why NSA even bothers spying on the people - they are just a sad lot of lazy, timid losers.
My poor kids. A very bleak future for them.
Well well well, seems this comment has been corroborated by a central banker no less. Biggest damn sovereign bond bubble in human fucking history (you don't abbreviate sovereign, it would be sov, i.e. soviet, and they're not blowing any huge fucking bond bubbles).
Of course he never says WHY they did it. No problem, we know why. And since we know why we also know the future of it, and no, there won't be any sudden deflating (sharply rising yield), so no worries there Mr Haldane.
And like every other central banker he ignores the real negative impact, that taboo subject called printing and currency debasement, which everybody else ignores too by the way. Ok, maybe not those rioting mobs in various places watching their savings and paychecks vaporize, but those useless eaters don't matter anyway, certainly not to any central banker (nor their bosses).
Central banks have unlimited power to print money for the purchase of government bonds. Unlimited means umlimited. There is only one way the government bond bubble can burst - if the Central Banks let it burst. And they will only do that if the consequences of doing otherwise are even worse.
Since they never tell the entire truth, it's probably worse than hes admitting. I mean if they admit to blowing up a bubble, wonder what it is they won't admit to?
Money is the most political of symbolic units.
What a absurd statement
The elites political organizations such as CBs are not called political by them offically but they very much are of course.
It is simply a question of inner sanctum politics vs exterior parish pump politics.
But its all fucking politics.
And for his next trick Andy will show you how he is going to let the air out of his bond balloon very slowly with a very sharp pin.
"A pin lies in wait for every bubble and when the two eventually meet, a new wave of investors learns some very old lessons."
Can it get any more unequivocal than this ? Of course, every bubble eventually finds the pin that bursts them and this bubble will be no different.
And Carney fires him in 3...2...
There is an unmatched quotation mark in the first paragraph which, of course, makes the paragraph harder to parse. It also indicates particularly sloppy ediiting when such an error occurs in the first paragraph. Zero Hedge generally has excellent prose and this mistake stands out like the cliched "sore thumb."