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Did Bernanke Just Do It Again, Asks Bill Gross
If anyone thought Bill Gross would take what is likely the worst P&L day in PIMCO history without a fight, they would be wrong.
Gross: To paraphrase #Bernanke 2002: “Regarding the Great (Re)pression. You’re right Milton, we did it. Sorry. We won’t do it again.” ???
— PIMCO (@PIMCO) June 20, 2013
So did Bernanke just do it again?
And incidentally, Gross is of course referring to the following speech:
The brilliance of Friedman and Schwartz's work on the Great Depression is not simply the texture of the discussion or the coherence of the point of view. Their work was among the first to use history to address seriously the issues of cause and effect in a complex economic system, the problem of identification. Perhaps no single one of their "natural experiments" alone is convincing; but together, and enhanced by the subsequent research of dozens of scholars, they make a powerful case indeed.
For practical central bankers, among which I now count myself, Friedman and Schwartz's analysis leaves many lessons. What I take from their work is the idea that monetary forces, particularly if unleashed in a destabilizing direction, can be extremely powerful. The best thing that central bankers can do for the world is to avoid such crises by providing the economy with, in Milton Friedman's words, a "stable monetary background"--for example as reflected in low and stable inflation.
Let me end my talk by abusing slightly my status as an official representative of the Federal Reserve. I would like to say to Milton and Anna: Regarding the Great Depression. You're right, we did it. We're very sorry. But thanks to you, we won't do it again.
Oh, and Bill, the answer is no: Fed assets with and without taper. If this is "doing it again" we can't wait to see what selling $5 trillion in securities, or about 50% of all 10 year equivalents, will look like...
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Not to worry Bill, 10s and 30s are 'WELL OFF THEIR LOWS, WELL OFF THEIR LOWS! SQUAWK! WELL OFF THEIR LOWS!' Oh, sorry to scoop you there Maria, I thought you only pumped equities.
... thought you only "pimped" equities...
Yes, good catch.
The big men buying billions of hollow point rounds, and near 3,000 armoured personnel carriers, along with a drastic, and moving at pace infringement of your rights friends should tell you one thing, and the soft spoken Bill Gross is pointing to it here.
At some point, and I believe it will be soon the 50 million of your lot who rely on the EBT will find them cards no longer work.
The rentier class be shitting themselves the cunts. Can you see why? You lot still have your right (at the moment) to give them a serious headache. Dont forget that, and make sure the anger id directed where it should be. And dont forget this, the world is waking up at a rate the rentiers cant comprehend, nor keep on top of.
Get ready for the big one folks, I think we all here knew it would come to this, and I wish each and everyone of you bitchez well in the coming months. Heads down, arse up friends.
Oh definitely that's next, and none of them can say no one warned them! They were all too busy watching 'reality TV' to make their own pathetic lives on the couch seem better. Yep, it's coming fast.
The turned-off EBT card theory sounds nice and all, but it isn't likely to happen. To the contrary, it is more likely that just like wartime ration cards, the entire populace will be issued and forced to use EBT cards to obtain necessities. The tipping point, so to speak, will be a disruption in the JIT supply chain system with respect to food. If and when that happens, Exec Order 12919 and the EO issued by Obama on 3/16/12 (http://tinyurl.com/ndawhzf) re National Defense Resources Preparedness, will be invoked to put food production and distribution systems under federal control (with help from military and nat'l guard). The EBT system is a ready-made ration control system that will be used to control people through means of provisions, and quite likely health care, etc.
The key unknown is whether the gov't will be able to maintain law and order in the time it takes to implement these systems upon a triggering event. I believe that the primary deployment focus of DHS armored vehicles is in the largest 100 cities. This makes sense, because that is where your food riots and civil unrest will be the most severe. The city lockdown after the Boston bombing (which I posit was executed by the gov't in order to test the efficacy of a lockdown) is illustrative of what we can expect.
The gov't is betting, and probably rightly so, that civil unrest/food riots/etc. will be isolated, as opposed to homogenous throughout the country, and that force can be deployed in strength to stamp out unrest. Count on it to follow the usual script - gov't infiltrators and agitators will ensure that whatever unrest happens quickly escalates into violence and property destruction, thereby giving the authorities license to use swift and lethal force in what will be a gruesome display calculated to strike fear into the rest of the country and serve as a warning against similar behavior. And it will all be touted as justified on the grounds that food shortages are caused and exacerbated by looters and thugs who want more than their fair share and must be swiftly put down like dogs to ensure fair shared sacrifice.
For those in rural areas, in particular those who think they will survive unmolested by farming their own food and raising their own livestock, they will be somewhat better off than the sheep corralled in the cities, but you'll see a re-emergence of the Doomsday book where everything you grown and own will be inventoried and you will essentially become a sharecropper for the gov't. The gov't isn't stupid and realizes that the collectivist farms of China and the Soviet Union didn't work well. You'll be allowed to keep farming and raising animals, you just won't get to keep much, if any, of it, and if you're caught short of your quota, you'll be imprisoned (or summarily court martialed and shot) and your land and animals given to someone else who will toe the line.
Anyhow, the failed-EBT card meme isn't very probable. What I foresee is a dollar collapse > repatriation of foreign held dollars > hyperinflation where producers shop selling because currency value is too unstable (just like rural farmers in Weimar) > collapse of JIT supply chain because nobody is willing to sell for dollars > civil unrest due to food/water/medicine shortages.
This is a fakeout. Bernanke will print for a long long time. Japan here we come.
Well I think they're all out of free money fake-outs to paper over collapsed bankruptcy and extend to pretend another day, it's hardly 2008 anymore that free ride is gone I believe....but believe what you want and plan accordingly.
Bernanke ``assets`` just took a big loss... How many billions of $$ did Ben lost yesterday??
BTFD...
I think Henry Ford is going to be proved correct.
Was that, "Beware the American three letter group of people."?
Home sales surge as the dump in the pump and dump in housing begins.
Damn....pity the poor fools who just got a new house unloaded to them at the top again.
Stop your whining, Bill. Shut up and trade.
It looks like the Fed wants the GOP in office this time. By the time this all play out people will be blaming the Democratic president for how things 'took a turn for the worse' in the economy and they will probably vote the elephant.
This is such a mirror image of '08 but the mechanism seems intact and similar
The sheeple have been conned into housing once again. Like I posted earlier.
Everyone I know is talking about home sales and how it is finally time to sell and buy. That after four long years of waiting, things will normalize again.
It's the biggest load of shit I have ever seen.
The big players are unloading left and right selling at any price to dump the homes on the sheep, ready to be fleeced again.
I'm seeing price cuts of $10-20k on unoccupied investor owned homes. Many still have a long way to go down until they hit the point of the initial investment made by the trusts.
I looked at a few homes on Zillow. One home was bought at a foreclosure sale for $76k in 2011 and put on the market in April 2013 for $215k. It is now listed for $175k with no takers.
Why would I hand $100k over what was paid to an investor? Let him make that much money, really? If there are no buyers that home goes to zero value pretty quickly. The pool of people who can actually afford to buy any home to live in is very small.
PUHLEASE! The only bubble Butfuck Shalom has blown is that of fraud and concealment of the financial coup d'etat exit.
Anything and everything else is distraction and shameless propaganda.
Get with it people. You have been fucked over by criminals and the lawless.
Money is dead. The comment about EBT and SNAP cards not working is absolutely correct. Divide and conquer in plain sight.
Watch the correlation of ES to UST, almost perfectly negative today. Rally ES and bonds get hit & vice versa. If ES goes green today 10Y UST is north of 2.50%. That is NOT what the Fed wants.
He who panics first panics best.
The ChairSatan does a thesis or whatever it was, on the Great Depression so he could learn how to cause a Greater Depression in his days as Fraud err Fed head
Let it slide. The market will digest this news and in a day or two will stabilize. The teet needs to be taken away from the vultures.
Ten year 2.5%...come on Bill, even you would not accept that as your only return for ten years. What rate do you need to hold an asset for ten years if you could not sell prior to maturity. My number is 3% above inflation ~5.5%. The liquidity shell game continues.
I'm sure it has been said already by someone else here, but does anyone else think that BB's "puzzled" comment was calculated as a "fuck you" to Obama for Obama's less than decorous treatment of BB? Don't get me wrong - I hope the whole lot of them gets eaten by wild pigs - but if I were in BB's shoes, and I'd been playing my part loyally knowing that my legacy is going to include all this mess, and then I'm publicly dissed, I would absolutely be tempted to get a little payback by saying something that stabs directly at the one external factor the Fed needs to keep the charade going - public confidence.
"If this is "doing it again" we can't wait to see what selling $5 trillion in securities, or about 50% of all 10 year equivalents, will look like..."
But their "plan" (cough, cough) is to hold many of those securties to maturity.
The last paragraph nails it. this is nothing like the Great Depression. Nobody has ever seen the pump on this hard, for this long. Monetary policy, at this point, only has the power to harm. There is no Good Side to it.
If Ben leaves the pumps on, we drown.
If he turns them off, we burn.
Thanks, Ben.
What a complete and total carbuncle on the ass of humanity. What an infection.
What should Bankrupt you Bernanke do? Put it in reverse & get the CBs out of the savings business & raise reserve requirements. I.e., the welfare of the CBs is dependent upon the welfare of the NBs. The NBs are the CB's customers. Transferring saved deposits thru the NBs (& shadow banks) cannot reduce the size of the CB system. Deposits are simply transferred from the saver to the NB to the borrower, etc. Economists were also blindsided by stagflation in the 60's & 70's (business stagnation accompanied by inflation). And its being blindsided once again by the exact same paradigm - increasing infusions of Reserve Bank Credit to generated the same inflation adjusted dollar amounts of gDp. The earlier problem was the result of 5 successive raises in Reg Q ceilings (but only for the CBs as the NBs weren't as yet regulated). Today's problem is the same with the introduction of paying interest on excess reserve balances. The IOeR policy induces dis-intermediation (an outflow of funds or negative cash flow). I.e., CB dis-intermediation hasn't been predicated on interest rates since 1933. The IOeR policy causes the NBs to shrink in size, but the size of the CB system to remain unaffected. See: "Low Inflation in a World of Securitization" FRB-STL "U.S. credit conditions may not drastically improve until sources of market funding start to recover. The Bank of England has moved away from asset purchases toward incentivized lending schemes that loan high-quality collateral (gilts) to banks, which can then be used to obtain cheap funding in repo markets. Given the U.S.’s reliance on market-based credit, similar policies to subsidize repo borrowing may have more impact than continuing to increase bank reserves" http://bit.ly/101eSiC
PTTRX down a whopping 1% today. That's huge for a bond fund.
#MudaBrasil #ProtestoSP #oGIGANTEacordou — in São Paulo, Brazil.
http://www.youtube.com/watch?feature=player_embedded&v=ifyVrj2lWT8
Cops sit down with protesters, Brazil