Now... Assume No Fed

Tyler Durden's picture

Back by popular demand.

Now... Assume No Fed

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
flacon's picture

Visualize Total Market Annihilation

King_of_simpletons's picture

We have the Treasury debt that keeps going up and now the Federal Reserve balance sheet is competing with the national Debt.

Splendid !

Why not have IRS just print free money too... they will get off our backs. Let them run another deficit in parallel to the above two.

ShankyS's picture

And as I always say that chart is wrong for '10 - BB promised QE at Jackson Hole in August that started the ramp, so although there was technically no QE there the sole "promise" moved price off the lows to the November start - adjust the chart please. If anything it will look better. 

camaro68ss's picture







Lets_Eat_Ben's picture

50% if the fed does intervene.

Fredo Corleone's picture

The "market" without the Fed ? The former cannot survive without the latter's liquidity life support mechanism.

The result of quantitative starvation ? A No Man's Land for those individuals and entities who still have capital committed to equities.

BoNeSxxx's picture

Just like 2007 it isn't what we see that is the problem... it's the cracks in the shadow banking/derivatives/insurance arena that will spark the collapse.  Wait on the Bernank or Crack Lew to call O'Bummer on the Bat Phone.  That will be the cue.

No TARP this time.  Full withdrawl cold turkey.

No Methodone for you.

ZerOhead's picture

No bailouts > No banks left standing > No ATM's, checks, physical cash circulation > No sustainable economy activity > No food, electricity, fuel or fancy new entertainment games gadgets or even internet eventually...

>Absolute economic collapse and total fucking CHAOS.

(All before they have had the chance to get the 'i's dotted and the 't's crossed on the modern totalitariian security state?... not going to happen...)

Ergo there will have to be yet more bailouts and obscene cash injections (tens of $T) into the banking system or it's GAME OVER.

It's called can kicking on steriods and it's all they can do now... until they can't.

They don't call it the 'Roach motel of fiscal and monetary policy' for nothing you know...

wisehiney's picture

It would be good to be holding some of those shiny rocks when they announce it.

Mr Bluesman's picture

Really - are we sure that's true? If all the investment banks / hedge funds went to the wall, would main street really get dragged down with them - would your deposit account suddeny disappear?

The deposit insurance would probably be cheaper than another round of bailouts. So one 'investment bank' owes another 'investment bank' a shitload of <Insert Asset/Currency/Share> and can't deliver. People on main street still make stuff. We still get up every morning and go to work, we still pay our bills.

I'm not sure the world would end for us. On Wall St, they would be clearing the corpses with a bulldozer, same as in Canary Wharf. I imagine the Chinese politburo might choke on their cornflakes too, seeing as they own much of the debt. 

But we are not going to stop working and living. Thinking that the average Brit or American is going to lie down in the dirt and give up is just defeatist nonsense.

ZerOhead's picture

Bank on it.

Nothing moves globally without banks dealing with other banks on trust that LOC's, loans, rehypothecated assets etc will be paid/repaid/redeemed. No banker wants to be left holding a bag full of shit on a Triple-Corzine.

If you don't bailout then you crash asset values/balance sheets of the  same institutions that are essential for the global flow of goods.

Once that level of global systemic complexity is lost you have mere weeks to get it up again or you lose it.

Never forget Lehman Fall 2008. The system froze and Paulson vomiting into buckets at the realization of what was about to happen was REAL...

ALL BERNANKE HAS BOUGHT US WAS TIME. (And an even bigger crash at the end of the day)

And literally no changes were made by the global financial markets nor Congress to fix the problem during the interim...

OpenThePodBayDoorHAL's picture

It's all fun & games but I think the muddle through scenario can continue for quite a while to come, remember as Kyle B says it's not the math that is in question it's people's perceptions and they have such a firm grip on that they can continue the magic show for quite a while. Sure it's prestidigitation but no one really wonders where the quarter went since they know the magician can just make it appear again.

ZerOhead's picture

Perceptions are key. Each little crack in the illusion (Cyprus bail-in etc) weakens the belief until enough people leaving the system causes a stampede to the doors.

Right now the sheeple are still believers in the "Great Resurection"...

underman's picture

Break up the banks and take away their deritivates trading desks.

gaoptimize's picture

Kind of gamy in the summer time around here. OBTW: Happy Solstice!  Perhaps some things other than the Sun are at their zenith.

Stoploss's picture

Caint we awl jus get alawng??

Frozen IcQb's picture

Now would be a good time for the money bunnies to say that the stock market has nothing to do with the US recovery.

camaro68ss's picture

A Recovery, This is what happens when you take the free drugs away from the crack hoe

Frozen IcQb's picture

Just a bit of profit taking today

Share buy-backs tomorrow

PKF's picture

Isn't tomorrow some triple/quadruple/infinity witching day? 

Is Denial over?

Whalley World's picture

That's where you fancy up your flea bitten old couch with nice new polyester and voila, new couch!


Style over substance, works every time in Amerika

Citxmech's picture

This CareerBuilder ad seems remarkably appropriate to me for some reason:


Frozen IcQb's picture

the US what?


Uhm! I meant the economy...

r101958's picture

You mean total 'farce' annihilation?

davinci7_gis's picture

Yeah...It takes us back to SP 1000 which was what Marc Faber said about 2 years ago!

Kinskian's picture

No wars is right. The volunteer military and the Fed have made these illegal wars possible.

Bringin It's picture

Fed money printing makes wars and the police state doable w/o the consent of the governed.

malikai's picture

There were wars before the fed, there will be wars after the fed.

The only question to me is what will people be fighting with after the fed completes its mission?

ZerOhead's picture

Each other with wooden sticks for scraps of food most likely... if they can get a bank loan to buy the wood that is...

SamAdams's picture

All your forests are belong to Agenda 21...

ZerOhead's picture

Either that or merely expropriate them for non-payment of carbon taxes...

Lets_Eat_Ben's picture

....and the proper permits to grow the food

glenlloyd's picture

You'll have to fill out form 55-f in order to get the permit application to begin with. Please take your completed permit application form down to window 9q and give it to Patty or Selma.

Kinskian's picture

Malikai, we used to pay for our wars. Our level of debt used to affect our ability to borrow to fund government spending.The Fed has allowed this president and the one before him to spend way beyond our country's ability to survive the burden of debt, and in the process enabled the US to engage in wars we can't afford and shouldn't be fighting.

Pairadimes's picture

“Whoever controls the volume of money in our country is absolute master of all industry and commerce…and when you realize that the  entire system is very easily controlled, one way or another, by few powerful men at the top, you will not have to be told how periods of inflation and depression originate.” – President James Garfield, two weeks before the assassination attempt that ultimately took his life.

johny2's picture

"Banking was conceived in iniquity and born in sin. Bankers own the Earth. Take it away from them but leave them the power to create money, and, with the flick of a pen, they will create enough money to buy it back again. Take this great power away from them and all great fortunes like mine will disappear and they ought to disappear, for then this would be a better and happier world to live in. But, if you want to continue to be the slave of the bankers and pay the cost of your own slavery, then let the bankers continue to create money and control credit." - Sir Josiah Stamp, President, Bank of England (2nd richest man in England)

Pairadimes's picture

"Gentlemen, I have had men watching you for a long time and I am convinced that you have used the funds of the bank to speculate in the breadstuffs of the country. When you won, you divided the profits amongst you, and when you lost, you charged it to the bank. You tell me that if I take the deposits from the bank and annul its charter, I shall  ruin ten thousand families. That may be true, gentlemen, but that is your sin! Should I let you go on, you will ruin fifty thousand families, and that would be my sin! You are a den of vipers and thieves." - Andrew Jackson, 7th US President  1836.

ZerOhead's picture

"... You are a den of vipers and thieves."


I am a little bit confused as to whether he is referring to the Bankers or the Members of Congress...

fonzannoon's picture

This was a pussified selloff with a side of btfd at the close.

ha i mushed it!

Everybodys All American's picture

Today's market ending was more likely shorts closing positions. There was no one buying nearly all day. Tomorrow is a new day and the shorts with the ten yr well into danger zone will likely come back in hard if the rates remain elevated.