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Meanwhile The 10 Year...

Tyler Durden's picture




 

Is headed for the moon... in yield terms that is. Because if Bernanke's hope was that the handoff from buyers to sellers would be a smooth one, he may want to conference in Kuroda and get some advice on what happens when the bond market is halted limit down.Good thing Bernanke is not a real hedge fund, or else the $35 billion intraday P&L crash (so far), and $250 billion in the past two months, may raise a few eyebrows.

 

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Mon, 06/24/2013 - 07:45 | 3686053 e-recep
e-recep's picture

paging helicopter ben, paging helicopter ben.

Mon, 06/24/2013 - 07:48 | 3686068 disabledvet
disabledvet's picture

thank God no other assets are priced off that thing. Bloomberg was just telling me to buy, buy, buy because of this. that was right after saying a 25 billion dollar right down at some "gold miner thingy" was "good news and put competitive pressures on "all those others who didn't have to do that." or else!

Mon, 06/24/2013 - 18:50 | 3688970 Western
Western's picture

To the moon Alice

Mon, 06/24/2013 - 07:50 | 3686074 Martial
Martial's picture

Helicopter Ben is now bladeless.

Mon, 06/24/2013 - 08:00 | 3686118 GVB
GVB's picture

So he did EJECT?

Mon, 06/24/2013 - 08:05 | 3686136 Frastric
Frastric's picture

Helicopters don't have ejector seats, if they did the blades would shred the pilot! That's why you're fucked if a helicopter goes down uncontrollably.

Mon, 06/24/2013 - 08:06 | 3686149 GVB
GVB's picture

LOL, thanks for pointing that out... ;-)

Mon, 06/24/2013 - 08:12 | 3686181 kralizec
kralizec's picture

Still...

Imagining Ben ejecting into the blades is pretty cool, ain't it?!  ;)

Mon, 06/24/2013 - 08:45 | 3686347 franzpick
franzpick's picture

Capt'n Ben: The term for your new interest rate management procedure is 'auto-rotation'.

Mon, 06/24/2013 - 08:49 | 3686361 Stackers
Stackers's picture

Scooby says: Rut-Ro

Mon, 06/24/2013 - 08:55 | 3686389 all-priced-in
all-priced-in's picture

Obama hit the eject button for Ben -

Mon, 06/24/2013 - 08:39 | 3686316 SamAdams
SamAdams's picture

Duh, you have to turn off the blades first.... Response courtesy of Rockefeller education. 

Mon, 06/24/2013 - 09:24 | 3686489 CrashisOptimistic
CrashisOptimistic's picture

Some ejector seats used to eject downwards.  Useless for failures during takeoff, but entirely possible.

Mon, 06/24/2013 - 08:25 | 3686248 Freewheelin Franklin
Freewheelin Franklin's picture

Unless it's an autogyro.

Mon, 06/24/2013 - 10:47 | 3686892 DutchR
DutchR's picture

Kamov Ka-50 does.

Mon, 06/24/2013 - 08:58 | 3686405 Dubaibanker
Dubaibanker's picture

Umm...actually...no...he just BAILED OUT! :)

Mon, 06/24/2013 - 09:31 | 3686519 Stoploss
Stoploss's picture

Thanks for lowering my property taxes Ben!!

Mon, 06/24/2013 - 13:42 | 3687791 mariobar
mariobar's picture

No, he ejaculated. Done.

Mon, 06/24/2013 - 09:59 | 3686639 Midasking
Midasking's picture

Without coin clipping this market is a smoking hole in the ground... politically unacceptable to stop. http://tinyurl.com/mem7o7x

Mon, 06/24/2013 - 08:01 | 3686116 xtop23
xtop23's picture

2.65%....... oh shit.

Training wheels are falling off Benny. 150B/mo overt QE sound about right?

Now .......... you are fucked.

Mon, 06/24/2013 - 08:01 | 3686124 GVB
GVB's picture

OMG, we're all so fucked.

Mon, 06/24/2013 - 08:05 | 3686140 SWRichmond
SWRichmond's picture

So an almost 1% increase in interest on $16 Trillion of debt is...how much again?

Mon, 06/24/2013 - 08:15 | 3686191 gatorengineer
gatorengineer's picture

you realize it doesnt work that way right?  only new paper sees the higher number.  Since they mark to Unicorn any move todate is at best Transitory in nature..... CBO will never account for it in the projections, the moment they do, the real reset begins.

Housing gets vaporized, in a few months... Short term this is extremely bullish for housing as the sheeple will now panic to refi and get into that McMansion before she blows... give it three months to work through the system...

If the banks are paying attention (they arent) it might flush all of that shadow inventory onto the market, but I doubt it.

 

Mon, 06/24/2013 - 08:26 | 3686252 SWRichmond
SWRichmond's picture

only new paper sees the higher number.

Muahahaha.  Yes, well, all of the existing holders of all of that paper are now motivated to change their minds, aren't they?  And markets are (allegedly) "forward-looking", aren't they?  One of the points being recurrently made by genuine free marketers is to point out what will happen when the ten year reverts to historic norms (6%).  Anyone wanna bet whether we'll see that?

Mon, 06/24/2013 - 09:08 | 3686441 trillion_dollar...
trillion_dollar_deficit's picture

A 6 handle on the TNX equals the end of western civilization as we know it.

Mon, 06/24/2013 - 09:28 | 3686509 CrashisOptimistic
CrashisOptimistic's picture

You do realize housing is being bought with cash?  Rental property requires 20% down, and when it's a foreclosure the delays are extensive, so it's cash.  Investors are just flipping those houses back and forth to each other.  There are no end buyers.

Mon, 06/24/2013 - 10:26 | 3686776 MachoMan
MachoMan's picture

In short, socioeconomic classes are set...

Mon, 06/24/2013 - 11:21 | 3687000 NotApplicable
NotApplicable's picture

Well, there's one end buyer at the end of the flipping chain. Question is, are you one of his friends? Or dead meat?

Mon, 06/24/2013 - 09:45 | 3686546 orez65
orez65's picture

"... only new paper sees the higher number"

Really?

Old paper gets hammered when the price of their "old paper" drops like a rock as interest rates go up.

It can easily turn into a bond selling panic as investors realize that increasing interest rates will make their bonds worthless, unless they can somehow hold them until maturity.

If you are in a bond fund you are fucked!

For a quantification of just how fucked you are read "justobserving's" post which I quote:

"For every 10 basis points move up in the 10 year yield results in a 1% loss in the bond.  Every 10 basis point move in the 30 year results in a 3% loss in the bond"

Mon, 06/24/2013 - 12:58 | 3687540 Meat Hammer
Meat Hammer's picture

Wasn't the crash that started the Great Depression caused in part by the Fed selling treasuries in the open market due to rising interest rates?  What happens if they try to do this again and the people buy up UST because of a good yield?  Does the government then owe its debt to the people and not the Fed?  If that were true I'm sure they'd have no problem defaulting on us because we were greedy for wanting a ROI.  

Mon, 06/24/2013 - 08:17 | 3686195 kralizec
kralizec's picture

Closer to $17T now, any additional paper will add to interest and overall the whole mess gets worse.

Mon, 06/24/2013 - 08:06 | 3686128 reload
reload's picture

Please step forward Mr Fonzanoon - the crowd are awaiting your lap of honor. Well called Sir, most did not see this coming and some will be going through the grinder very painfully indeed.

The Stock sell algos will have to unleashed big time now. Are there many shorts to buy it on the way down, or will it be the express elevator?

Mon, 06/24/2013 - 08:22 | 3686227 gatorengineer
gatorengineer's picture

I think the call actually was 2.35 on a real taper not the threat of one....  something else is in play here, I suspect some highly leveraged stuff is blowing up.....  Some hedgies should be backfloating soon.... 

Mon, 06/24/2013 - 08:26 | 3686250 fonzannoon
fonzannoon's picture

My exact call was 2.35% by the end of this month and 2.75% within 3-6 months.

I would love to be on here taking victory laps but there is no way I saw 2.65% right here and now. I am also too busy watching the balances on my clients bond allocation dwindle and am trying to get in touch with Bernie Madoff to find out how I can mark to unicorn on their next months statements.

Mon, 06/24/2013 - 08:53 | 3686365 RSloane
RSloane's picture

You did call the pre-market bloodbath though. I bow to you Sir. I wasn't sure if it was going to play out like that.

 

PS Daneric's hasn't posted their call. First time that I can remember that we're approaching 9 EST and nothing yet.

Mon, 06/24/2013 - 09:01 | 3686414 fonzannoon
fonzannoon's picture

Thanks RSloane, it looks like someone finally woke up the drunk captain and he is trying to steer the ship again. Let's see how long it lasts.

It's funny I was just listening to Cramer pitch regional bank stocks with the premise that they should continue to pay grandma no interest here and bank the spreads on the 5 year treasury. He should just have declared today "punch a grandma in the face day".

No one cares.

Mon, 06/24/2013 - 08:09 | 3686165 kill switch
kill switch's picture

Hay fuckhead go to the nearest courtesy phone , you know the green one with QWERTY virtual keyboard...

Look he's picking his nose, Fifty bucks he eats it,,,,your on.. Look at the cash pouring out of that thing.

Mon, 06/24/2013 - 08:26 | 3686256 Dr. No
Dr. No's picture

"We've just lost cabin pressure..."

Mon, 06/24/2013 - 09:50 | 3686602 Dingleberry
Dingleberry's picture

Seriously, does it take an expert to predict what happens to bonds when Ben stops buying them? Does one need an MBA from Wharton that costs 6 figures to discern this?

Mon, 06/24/2013 - 10:14 | 3686719 deKevelioc
deKevelioc's picture

If Bennie doesn't step in, this could be it.  I've been waiting a loooong time for this chit, but Bennie is only playin'; he's got his hand on the wheel (I think).  The next reflate will be truly awesome.  The US has more wars to blame others for, but the gold market has to become screwed up, first.  When I read from some dork that gold is going to $500, I'm all in.

Mon, 06/24/2013 - 12:45 | 3687466 Silveramada
Silveramada's picture

Ben, you loosing it..once the 10 yrs are at about 3- 3.5% you are done baby...

http://zysites.com/silververitas/

Mon, 06/24/2013 - 07:46 | 3686057 Bearwagon
Bearwagon's picture

"all engines running . . . commit! . . . liftoff!"

Mon, 06/24/2013 - 07:46 | 3686063 Haus-Targaryen
Haus-Targaryen's picture

Buicks to the Moon.  Youtube it.  

 

Seriously though Ben prints it, Obama builds Buicks, and attempts to fling them to the moon with the world's largest slingshot.  StIMuLuS! 

Mon, 06/24/2013 - 07:50 | 3686076 Headbanger
Mon, 06/24/2013 - 07:50 | 3686067 blindman
blindman's picture

http://www.maxkeiser.com/2013/06/kr461-keiser-report-global-financial-ho...

[KR461] Keiser Report: Global Financial Holocaust
Posted on June 22, 2013 by Stacy Herbert

Read more at http://www.maxkeiser.com/2013/06/kr461-keiser-report-global-financial-ho... SY7azJk.99
.
fake assets = fraud

Mon, 06/24/2013 - 07:54 | 3686069 kahunabear
kahunabear's picture

Oh my! I thought Bernanke owned all of these. Maybe some China liquidity problems coupled with spying blowback.

Mon, 06/24/2013 - 07:59 | 3686112 swissaustrian
swissaustrian's picture

Bernanke ownes a lot of them. His losses are mounting.

There might be no profit transfers from the FED to the Treasury this year.

Mon, 06/24/2013 - 08:03 | 3686130 xtop23
xtop23's picture

+1

Gave me quite a chuckle. Thx for that.

Mon, 06/24/2013 - 07:49 | 3686072 Disastra
Disastra's picture

My quoted 96% FHA mortgage payment for my manhattan condo has increased $300 per month in the past four weeks.

 

Its a short sale so we couldnt close fast.

 

Neither did I rate lock.

 

I am backing out of the contract this week.

Mon, 06/24/2013 - 08:31 | 3686270 Dr. No
Dr. No's picture

I recommend backing out just for the sake of f*cking the bank...

Mon, 06/24/2013 - 07:54 | 3686095 Dr. Engali
Dr. Engali's picture

Price stabilliteeeeee... bitchez.

Mon, 06/24/2013 - 08:02 | 3686129 Bearwagon
Bearwagon's picture

I upvote you just for raising our battlecry. ;-)

Mon, 06/24/2013 - 08:05 | 3686137 NoDebt
NoDebt's picture

US Treasuries trading with the volatility of Penny Stocks.  Welcome to Hell, boys (and girls)!

Somebody get me a cup of coffee STAT!

Mon, 06/24/2013 - 08:06 | 3686146 fonzannoon
fonzannoon's picture

The fed can overwhelm flow but he has no shot at buying stock to stabilize things if it gets dumped.

This is crazy shit Doc.

Mon, 06/24/2013 - 08:13 | 3686184 walküre
walküre's picture

Like the ECB, the Fed has UNLIMITED BUYING POWER

Do you honestly believe that this is a "market" reaction and the Fed is not in the driver's seat?

The Fed wants more blood. Bernanke is quoted as saying "Depositors want higher returns on their money" last year.

They want to have their cake and eat it too. Flooding the world with worthless paper that they control and now they want higher returns on the huge amounts of paper they pumped into the system?

Mon, 06/24/2013 - 08:19 | 3686211 fonzannoon
fonzannoon's picture

The fed has unlimited buying power. Agreed. He can absolutely hit print to infinity and buy every stock of treasury out there. That's called hyperinflation.

The rubber meets the road when the debt starts getting rolled over at higher rates. We all know that.

The fed has one option on the table if they want to bring rates down right now and that is to annihilate stocks, right here, right now.

If they truly want rates to rise, that is fine. Maybe, just maybe they want a credit crisis to bring in true austerity. I doubt it, but maybe that is the case.

Mon, 06/24/2013 - 08:26 | 3686254 walküre
walküre's picture

Maybe Ben had a nightmare where hyperinflation destroyed all credibility in the US Dollar and the Fed. He would loose control when the people stop accepting his paper. That's the only gig he has. Now he's trying to recreate value for the paper. Stocks need to come down. Speculative money needs to flow into UST.

However, we have higher bond yields and a stock market correction?

Mon, 06/24/2013 - 09:56 | 3686628 Dingleberry
Dingleberry's picture

walkure, despite what Ben SAYS, he knows damn good and well we are reacing bubble territory in RE and stocks. And inflation (as if he cares) is indeed going up. He does not want to commit suicide but obliterating the USD, and he tries to talk the market "up" to keep it afloat when he exits his printing 85 large per month.

Obviously, reality has bitten. It won't be linear one way or the other, but prices usually revert to the mean. That means interest rates too.

Inflation has not been tamed, only disguised. The market knows it.

Mon, 06/24/2013 - 08:27 | 3686259 gatorengineer
gatorengineer's picture

The fed does not have unlimited firepower... See Japan...  M1 is 2.5T, they are printing a T a year, at some point this will get into M1...... and BOOM.....

 

They ramp up printing they risk Japan like stability....

Mon, 06/24/2013 - 08:30 | 3686266 fonzannoon
fonzannoon's picture

That is exactly right. Theoretically they do, but in reality it's already over when they have to use it.

Mon, 06/24/2013 - 09:15 | 3686460 Bearwagon
Bearwagon's picture

It's like having a shotgun with only one single shot. You can control a whole horde with it, by threatening each and every one to shoot just him, so they are motivated by fear to do as you like. But the moment you fire your one and only shot, you'll have lost your coercive and will be overwhelmed by the remaining gang. It really is that simple.

Mon, 06/24/2013 - 08:23 | 3686220 Dr. Engali
Dr. Engali's picture

This has the potential to spiral out of control real fast. CNBS has the same tired old people on spouting buying opportunity. What they don't get is that all the damage in the bond market is spooking people more than the equity market. They also fail to mention that rising rates are going to stop the housing markets dead in their tracks.

Mon, 06/24/2013 - 08:56 | 3686393 RSloane
RSloane's picture

It is now time to do the CNBC "we're off our lows" dance. We went from -141 to -138. Salad days are here again!

Mon, 06/24/2013 - 13:15 | 3687627 Meat Hammer
Meat Hammer's picture

Doc, what is your opinion on the thought that people will rush even more quickly into buying a house before interest rates go any higher, thus causing more bullishness for RE?

Mon, 06/24/2013 - 07:55 | 3686098 AUD
AUD's picture

This is an interesting development, but the 10yr priced in $ is still going to par.

Mon, 06/24/2013 - 07:56 | 3686101 electricgorilla
electricgorilla's picture

student loan debt that is not fixed just got linked to the 10-year note right before this take off in rates.....how unfortunate

Mon, 06/24/2013 - 09:57 | 3686633 Dingleberry
Dingleberry's picture

or coincidence electric? That is genius. Pure (evil) genius.

BTW, I don't ever believe in coincidences.

Mon, 06/24/2013 - 07:56 | 3686103 alexdg
alexdg's picture

I wonder how things would look if CME hadn't lowered margins on treasury futures last week. 

CME sees rising volatility in Gold and raises margins, sees the same in Treasuries and lowers margins. 

 

Mon, 06/24/2013 - 08:03 | 3686133 Quinvarius
Quinvarius's picture

The CME is going to be the bag holder for a lot of banking mistakes.  They went along with too much fraud.

Mon, 06/24/2013 - 07:59 | 3686113 blindman
blindman's picture

'You F--ked Up, You Trusted Us': Talking Ratings Agencies With Chris Hayes
By Matt Taibbi
POSTED: June 21, 11:25 AM ET

Read more: http://www.rollingstone.com/politics/blogs/taibblog/you-f-ked-up-you-tru...
Follow us: @rollingstone on Twitter | RollingStone on Facebook
.
"...That was among the responses of a spokesperson for the ratings agency Standard & Poor's when I contacted him a few weeks ago in advance of a new Rolling Stone feature, "The Last Mystery of the Financial Crisis," which describes the role the ratings agencies played in causing the 2008 crash. The company was genuinely miffed that anyone would impugn its honesty. In one relatively brief e-mail, the spokesperson used variables of terms like "independent," "integrity" and "transparent," upwards of nine times.

Hold that thought.

"The Last Mystery of the Financial Crisis" makes great use of documents uncovered in years of painstaking research by attorneys at Robbins Geller Rudman & Dowd, a San Diego-based firm that was at the forefront of major lawsuits against the industry. The material those lawyers found leaves virtually no doubt that the great ratings agencies like Moody's and S&P essentially put their analysis up for sale in the years leading up to the crash.

I picked some of the more damaging of these documents to ask about. Like for instance, an email from a company executive reading, "Lord help our fucking scam. . . . This has to be the stupidest place I have worked at." " m.t.

Read ....

Mon, 06/24/2013 - 08:02 | 3686125 tok1
tok1's picture

could this be Chinese banks selling treasuries to get liquidity ..

Mon, 06/24/2013 - 08:05 | 3686143 Quinvarius
Quinvarius's picture

No one is going to want that garbage now that momo has left the building.  Look what they do to stuff that has actual value.  Treasuries are at peak bubble and dropping.

Mon, 06/24/2013 - 08:14 | 3686189 Its Only Rock N Roll
Its Only Rock N Roll's picture

Yes, China is selling for sure.  Coordinated effort on their part I'm thinking.

Mon, 06/24/2013 - 08:32 | 3686279 gatorengineer
gatorengineer's picture

dollar should be tanking then..... instead RMB is going down (relatively)...

Mon, 06/24/2013 - 08:02 | 3686126 JustObserving
JustObserving's picture

For every 10 basis points move up in the 10 year yield results in a 1% loss in the bond.  Every 10 basis point move in the 30 year results in a 3% loss in the bond.

Mon, 06/24/2013 - 08:04 | 3686132 walküre
walküre's picture

The fucking Fed is buying. The fucking Fed wants higher returns on their "investments".

Folks, don't be fooled. This is the world of the Fed. The Fed is filled with paper and now they want more blood from us mortals in shackles on the odious debt.

Bernanke is a con artist. First he rope-a-dopes the world into cheap borrowing, recovery on the cheap and now he's tightening the noose.

What about this is not obvious? The fucking Fed is a leach on the planet and Bernanke & Co. are parasites.

They are always in the driver's seat.

http://www.youtube.com/watch?v=QngGvHTOKh4

Read the comments from Brazil.

http://www.youtube.com/watch?v=gMYNfQlf1H8

FUCK YOU BERNANKE!!

DO YOU HEAR THE PEOPLE SING? SINGING THE SONG OF ANGRY MEN?

OFF WITH THE HEADS OF THE BANKSTERS SNAKE!

 

 

Mon, 06/24/2013 - 08:03 | 3686134 UK debt marsh
UK debt marsh's picture

$250 billion loss and counting at Bank of Ben

Math.....whoudathoud

Mon, 06/24/2013 - 08:05 | 3686139 GetZeeGold
GetZeeGold's picture

 

 

No problem....we'll just call the printer room for it.

Mon, 06/24/2013 - 08:14 | 3686180 depression
depression's picture

I have faith in Ben, he will average down his loss, keep buying Ben keep buying. Imagine the looks on the faces of the math modelers at the Fed this morning, hilarious, "uhhhh wtf, that can't be right, re-run that model !!!!"

 

Mon, 06/24/2013 - 08:05 | 3686141 razorthin
razorthin's picture

Is that sound I hear houses crashing?

Mon, 06/24/2013 - 08:05 | 3686142 Ribeye
Ribeye's picture

Anatomy of an Irish Bank Bailout,

Taped phone call from inside Anglo

http://www.independent.ie/business/irish/inside-anglo-the-secret-recordi...

Riveting stuff,

More tapes to come,

Wednesday I think,

Mon, 06/24/2013 - 08:36 | 3686305 goldinpenguin
goldinpenguin's picture

Reggie Middleton nailed it with his call about Irish banks (re) collapsing.

These people should be drawn and quartered

Mon, 06/24/2013 - 08:31 | 3686147 falak pema
falak pema's picture

here is a truthy funny article that the media now unearth, that every "non believer" in the system knew about since donkey's years :

http://www.rollingstone.com/politics/news/the-last-mystery-of-the-financ...

 

THe last mystery...lol; like Enron and Haliburton in energy. Hype and tripe.

So...we close the door now that the horse has bolted.

But when do we prosecute these multiple scammers who ran off with their bonuses?

Mon, 06/24/2013 - 08:08 | 3686156 gatorengineer
gatorengineer's picture

Buckle up today at 12.29 Fisher speaks at 12:30 today, high probability of a serious ramp right afterwards.....  He has got to try and talk bonds down right?

Mon, 06/24/2013 - 08:13 | 3686186 fonzannoon
fonzannoon's picture

I take the flip side of that gator. Well at least not a serious ramp anyway. Maybe another pause. I think he comes out and proclaims this rise in interest rates justifies the underlying growth that is taking place in the economy. This is a good thing, and should be celebrated.

Oh and by the way....this is far enough. If anything we have maybe overshot to the upside a bit

Mon, 06/24/2013 - 08:37 | 3686308 walküre
walküre's picture

fake recovery, fake growth, fake money BUT real interest (earnings) from all that fake shit.

what's not to love when you're a banker?

Mon, 06/24/2013 - 08:58 | 3686401 gatorengineer
gatorengineer's picture

your absolutely right, he has a chance to disappoint.... I really thing something else is afoot, as you say this has way overshoot, and now I think it is leveraged positions blowing up....  leveraged bond ETFs may have something to do with it....  If you look at TBT alone its ripping at almost a billion dollars a day in volume and I would imagine alot of that is buys, so that is alot of highly leveraged paper....

quarter close this week, wonder if they are going to make a push to put lipstick on the pig...

 

Mon, 06/24/2013 - 08:08 | 3686159 mydogisprettier...
mydogisprettierthanyou's picture

Is this the beginning?

Mon, 06/24/2013 - 08:18 | 3686208 Skin666
Skin666's picture

I fucking hope so...

We've all got our lives to live...

Mon, 06/24/2013 - 08:12 | 3686177 ...out of space
...out of space's picture

what was that banker name from london who sad that they gonna pop the bond buble on purpose. it was on ZH but i cant find that. 

 

Mon, 06/24/2013 - 08:15 | 3686194 Fiat Burner
Fiat Burner's picture

The Bernank has to sacrifice the stock market to get the money back into treasuries.  They cannot let the treasury market blow up. That's where the fiat ponzi starts.

Mon, 06/24/2013 - 08:22 | 3686229 buzzsaw99
buzzsaw99's picture

jpm fixed income unit earnings have been flat to down. need volume. [/cynical]

Mon, 06/24/2013 - 08:16 | 3686200 breakyoself
breakyoself's picture

CNBC really in 'stock market is da shit don't get out' mode.

Mon, 06/24/2013 - 08:22 | 3686230 pitz
pitz's picture

Obviously Bernanke failed flight school.  Why?  Because he doesn't understand the power curve, or being "behind the power curve" as it applies to aviation.

Being "behind the power curve", conceptually in flying means that you can keep increasing the angle of attack, and the engines can be a'screaming, but eventually you'll fall out of the sky because drag increases at a rate higher than the engines can possibly keep up with. 

Volcker correctly realized in the late 1970s that the only way to correct this problem was to pitch the economy down, let it liquidate the unproductive activities (ie: commodity speculation), and regenerate itself energy-wise. 

Bernanke seems perfectly content to fly right into a stall and probably a crash.

Tsk, tsk. 

Mon, 06/24/2013 - 08:23 | 3686233 Lewshine
Lewshine's picture

It's finally come! Time to watch Bernanke and our corrupt politicians SQUIRM! Nothing affects the staus quo more than losing control. And to think, Obami's handlers are going to put him on the national podium this week to sell us on a world wide CO2 tax. Because, greater tax slavery is good medicine that calms the nerves of any tyrant trying to hang on to power. He will show mountains of conviction as this being the "right thing to do"...And the media will parade those for and against to lend credibility to this further abuse of power and confiscation- Think: Obama Care (a mandatory obligation implemented on US citizens by government on behalf of private enterprise...Enforced at the point of a gun).

Mon, 06/24/2013 - 08:24 | 3686239 VanillaSkyGuy
VanillaSkyGuy's picture

I agree with Flatburner. Market is uncertain right now, not scared. When the market reaches max fear money will turn to Govy and Gold. If we are following Japan's lead from just a few weeks ago why can't the S&P come down to the 13's?

Mon, 06/24/2013 - 08:32 | 3686282 sudzee
sudzee's picture

The great rotation? Into what?

Mon, 06/24/2013 - 09:24 | 3686490 razorthin
razorthin's picture

Clownbux, apparently.

Mon, 06/24/2013 - 08:34 | 3686295 walküre
walküre's picture

http://www.reuters.com/article/2013/06/24/markets-bonds-euro-idUSL5N0F00...

Bunds are going down

Good for German mortgage holders.

Mon, 06/24/2013 - 08:41 | 3686324 optionsman
optionsman's picture

the Treasuries reaction to confirmation of QE tapering plans is a bit of a headscratcher to me. i like the BIS paper entry over the weekend which kind of gave me some possible answers as to why the Fed appears to be so intent on starting the tapering. reaction in risk markets is as I expected. I do admit that the growth in the US given sequestration impact fears has been sort of on the impressive end although i understand the argument that the impact of sequestration is still to come. still waiting though.....but back to Treasuries- is issuance rising? is there a shortage of high quality collateral? should there be flight to quality given what we see in risk markets? is inflation rising? is growth outstripping expectations? i totally understand that the expectations of rising Treasury float are natural given taper. nonetheless i am a bit confused about Treasury yields. this may be the canary in the coal mine. if this continues IMHO there will be a lot more risk markets bloodbath to come...a lot more.

Mon, 06/24/2013 - 09:41 | 3686560 ArkansasAngie
ArkansasAngie's picture

Some folks say that July 11th is government take over day. Here's hoping that conspiracy theory is wacko

Mon, 06/24/2013 - 11:04 | 3686986 syntaxterror
syntaxterror's picture

This was the problem of investing into a 100% manipulated market folks.

Mon, 06/24/2013 - 16:29 | 3688534 cebri88
cebri88's picture

Get to work Mr.Chairman... LOLZZZZ

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