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Guest Post: The Dark Side Of The QE Circus

Tyler Durden's picture




 

Submitted by Andy Sutton via The Silver Bear Cafe blog,

There may come a day soon where the markets sell off if one of the whiskers in Big Ben's beard is out of place. Or perhaps if his tie is a bit crooked. Or maybe we end up with Janet Yellen as the next puppet in charge over at the local banking cabal and we fret about her hairdo. I don't know, but one thing that is for certain is that this central bank so wants to be loved and we are so under psychological attack with all of this QE nonsense that it isn't even funny.

QE is the endgame. ZIRP was only the beginning. QE, or monetization (which they'll never call it because of the negative connotations), is the heroic measure applied to an already dead system. Our system, for all intent and purposes, died in 2008. It ceased to exist. The investing, economic, and business paradigm that has existed since is drastically different than its predecessor despite all the efforts being made to convince everyone, including Humpty Dumpty, that it is in fact 2005 all over again.

Quantitative Conditioning

Now we get to the fun part of the game. This is the part where the not-so-USFed wants to give the idea that it is tapering (buzzword of the month) without actually doing so. There will be no tapering. There will be no end to QE. The goose (Americans and their willingness to continue to pile up debt) is still laying the golden eggs. And even if they make paper contracts on those golden eggs gyrate wildly in price, they still want them. The quislings on television who are gleefully bashing precious metals this morning? They want them. They want your physical metal. These folks will swim through any sewer to get that which they desire. If you don't understand the Machiavellian nature of your enemy, then you're in for an extremely rough ride. This is no playground. This is a battlefield (credit to Chuck Baldwin). They're playing chess and we're still playing Tiddly Winks.

I've told people many times that you will be given no quarter by these people. The entire world is red. ALL markets are down. Commodities, equities, precious bonds, everything. It would be my guess that we're going to see many more mornings like this, especially any time the Barbasol man mentions the magic word: taper. And even this is not without purpose; you are being conditioned that the not-so-USfed and its obscene, virulent policies are a necessary intrusion in your economic life. Just like you were conditioned that inflation is necessary for economic growth, you will now come to believe that central bank manipulation of every market imaginable is in fact a necessary component to keeping the charade going.

Mornings like today are part of that conditioning. Trot out the Bernank' and have him mention ending QE, then the markets immediately go in the tank. This has become something of a pattern. Keep it up long enough and people will start demanding QE. They'll demand to have their mortgage, car loan, school loan, and everything else owned by international banksters. They won't care. Just make it stop. Make the pain go away. They won't care that they will rise everyday with no other purpose in mind than paying the interest to service debt that was created from nothing.

Yet in several weeks these same folks will gather and celebrate our independence. What a sick joke. We've been played like a two-dollar fiddle and we don't even know it. I heard a great line last night on Liberty Talk Radio. One of our callers called this a 'press release economy'. Credit: unknown. He couldn't have been more correct. We live and die on reports issued by an institution that has everything to gain by keeping us in the dark and nothing to gain by telling us the truth. Yet we clap our hands like little children when it tells us 'this is for your own good, just give us your bank accounts and retirement savings'.

That is what is coming. Probably not all at once, but over time it will all be confiscated, for our own good of course. If there is anyone who thinks that these folks will be able to resist the $18 trillion and change currently in the US retirement system, then I've got some beachfront property in North Dakota to sell you cheap. And yes, North Dakota borders Canada, rather than South Dakota as was so blithely asserted by a sitting US Senator last week.

Metals News

The metals complex has been the red-headed step child of the international bankers since the 2011 high. Ironically, the price pattern that has traced out since does actually fall into the confines of what could have been expected if using Elliott Wave analysis. Not that EW is the be all of end alls, but it is worth noting. Also worth noting is that once this mother of all corrections is over, there are going to be some high times for metals. Now, whether or not that will include the paper markets remains to be seen. Personally, I am hoping the paper markets crash and burn. I'd have no problem seeing $500 paper gold and $2000 physical gold. The end of that sham will be an amazing site.

Watching JP and the boys squirm as they try to wiggle their way out from under all the foul paper bets they've made would be even more fun, but unfortunately we have nearly two century's worth of history on how that one will end. They will run to the government, which will promptly let them off the hook, just like they did for the silver banks in the 1800s. Unfortunately, there is no Andrew Jackson; at least not yet.

This writer cannot help but wonder if the current fear climate isn't intended to push assets into cash where they can be easily scooped up in a neat and tidy bail-in after the next Lehman brothers occurs. With the new bail-in mentality now codified around the world, mark my words, the next time there is a flare up of the European mess, the Japanese mess or our very own twisted system trembles on the head of a pin, Robbin' the Hood will make an appearance and people are going to get a haircut – Cyprus style. Don't believe me? That's fine. Watch hockey or basketball or maybe go shopping. However, if you think there might be a shred of truth to what is being presented in this piece and many before it, then take heed of a few simple truths:

1) If you don't hold it in your hand, then it is not truly yours. Possession is nine tenths of the law. Always has been, still is. Get your assets as close to you as possible.

 

2) The above includes your precious metals. There are many fine and well-intended folks who think you should store your metals an ocean away. What good does that do you, especially if you can't retrieve them?

 

3) Be your own central bank. All of the above truths have an underlying principle: responsibility. You need to start being responsible for your own economic destiny. The government is not going to help you. The bankers certainly aren't going to help you. Running to them for solutions is like Little Red Riding Hood asking the wolf for advice on how to cook dinner.

Finally, there are many who are saying you should just leave the country. Go somewhere else. They fail to recognize that this is already largely a global problem. And even the little hideout countries are not immune. If our forefathers had felt the same way, we wouldn't have this rich inheritance that we are now squandering. My prayer for this country is that one day soon enough of us realize that there are some things in life that truly are worth fighting for and the freedoms this country was founded on might just be one of those things. Just sayin'.

 

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Wed, 06/26/2013 - 19:18 | 3697205 Victorio
Victorio's picture

Was there a light side?

Wed, 06/26/2013 - 19:33 | 3697231 nope-1004
nope-1004's picture

Bernocchio and all his PR regional fed asshats are simply full of shit.  They want to be loved?  LOL.  More like they want your wallet.

This illusion we live in called an economy is not on life support, it's on death support.

Someone stick a fork in it already.

 

Wed, 06/26/2013 - 19:38 | 3697251 knukles
knukles's picture

Barbisol, Barbisol
Makes your Anus
Feel Fresh and Clean
After Reamings
Or in Between

Uncle Ben
Who Was
Bald on Top
Said I wish I Could
Rotate the Crop
QE Shave!

 

La la la la la  I wonder if there's a good fight on tonight or I gota wait till Friday?

 

Wed, 06/26/2013 - 20:16 | 3697350 franzpick
franzpick's picture

Hey Capt'n Benocchio, the time for your 'auto-rotation' check ride is coming up soon before you retire, and having never had to do it you'd better brush up a little; it's just that emergency descent procedure for powerless chopper pilots, kinda like twisting in the wind.

Wed, 06/26/2013 - 19:34 | 3697243 TuPhat
TuPhat's picture

The AD for a military school that popped up must have been meant to be a hilarious joke.

Wed, 06/26/2013 - 19:45 | 3697263 HedgeAccordingly
HedgeAccordingly's picture

inflation what? Lacker - http://hedge.ly/139ap1c 

Wed, 06/26/2013 - 19:22 | 3697212 Lord Drek
Lord Drek's picture

Want so to be loved? Dude, wise up. They're biding theirtime, waiting for the appearance of a certain world ruler who'll claim to have the answer to all the world's problems.

Wed, 06/26/2013 - 19:46 | 3697265 Professorlocknload
Professorlocknload's picture

Attila The Hun 2016.

Wed, 06/26/2013 - 19:28 | 3697214 krispkritter
krispkritter's picture

 'Personally, I am hoping the paper markets crash and burn. I'd have no problem seeing $500 paper gold and $2000 physical gold. The end of that sham will be an amazing site(sic).'

 

Physical doesn't burn...paper should be ashes.  If Ben's beard is out of place I hope it's because his fucking head is jammed in his printer.  Fuck you Bernanke! Ya Ctrl-P pushing twat!

Wed, 06/26/2013 - 19:28 | 3697226 nmewn
nmewn's picture

Mmm, look like monetary dog shit...smell like monetary dog shit...taste like monetary dog shit...eeez dog shit.

 

Wed, 06/26/2013 - 19:31 | 3697239 SKY85hawk
SKY85hawk's picture

It's nice we can vote for the commenters.

WHY can't we vote fo the Author?

I won't use facebook or google until they are secured by Norton Internet security.

Wed, 06/26/2013 - 19:40 | 3697255 knukles
knukles's picture

LOL

 

 

Wed, 06/26/2013 - 19:45 | 3697262 thelibcentury
thelibcentury's picture

Read Wired recently? Norton is child's play if GUS has a reason to be interested in you.

Wed, 06/26/2013 - 20:14 | 3697342 knukles
knukles's picture

It IS a back door!
Wired's recent article to which you refer is another confrimation of them "conspiracy theories" batted around for years

LOL

Wed, 06/26/2013 - 20:50 | 3697453 SKY85hawk
SKY85hawk's picture

ok, suggest me a real strong I/N security, please.

Thu, 06/27/2013 - 00:23 | 3698059 MeelionDollerBogus
MeelionDollerBogus's picture

Linux + ipsec + ssh & SSL with cryptfs and if you can manage it, solid-state drives and running most things off ramdisk.

Thu, 06/27/2013 - 06:50 | 3698475 Help Is Not Coming
Help Is Not Coming's picture

And if you can really manage it build your own version with "Linux from Scratch" and move the root directory to some place like '/734Ad/AJDwolz/'. That way they'll never be able to stack smash it to get in.

Thu, 06/27/2013 - 09:25 | 3698751 Overflow-admin
Overflow-admin's picture

Confidential information? In the Safe. Wires are used to SHARE information, not to witthold. If you feel like you're really skilled and that nothing you will either configure or use will ever have any exploitable flaw, go ahead and try linux. So I repeat: Buy A Safe.

 

P.S. 15 years practicing and the only secure systems I know have NO NETWORK CONNECTIVITY. How odd is that?

Wed, 06/26/2013 - 19:32 | 3697242 Grinder74
Grinder74's picture

Hey! Great article picture!!

Wed, 06/26/2013 - 19:43 | 3697247 q99x2
q99x2's picture

You have to move in with special ops forces into the FED Goldman and the Morgue simultaneously and then let one of the military contractors move everything to a national crypto-currency as you dole out life sentences to the banking CEOs and FED Chairmen through a re-established Justicial System.

Holder has to be arrested and used as an example.

It would work like a charm. Imagine the incentive and stampede of interest to immediately be part of the new system. Some version of that might play out. I've heard suggestions that the military defense contractors take control of the monetary system from the FED during the collapse. Something functional will have to be brought up quickly.

Wed, 06/26/2013 - 19:42 | 3697256 BadDog
BadDog's picture

They don't give a shit whether you like them or not.  They want all you possess.  All of it.  In other words peaches, they want your soul.

Wed, 06/26/2013 - 19:50 | 3697268 involuntarilybirthed
involuntarilybirthed's picture

Go away, we don't want your stink'n paper money or you silly metals as we will collect them soon enough.  You are on our property (which is most all of it) I don't care if you need food from our farms or water from our wells, go away or you will be removed and put back in your place to die camps.  Soon this heaven on earth will house the worthy and wealthy promised 144,000 and not one more. Besides you smell, carry disease and cause global warming.  Oh how sweet it will soon be without the need for the camps.

Need to make a movie "The 144,000"

Wed, 06/26/2013 - 19:51 | 3697271 rational
rational's picture

LOL the tin hat crowd is out in force tonite!

Wed, 06/26/2013 - 19:57 | 3697297 CrashisOptimistic
CrashisOptimistic's picture

Guys, stop it.

There is no great conspiracy going on.  No one is planning anything.

They are all, every one of them, at the mercy of a civilization of 7 Billion people who are dependent on joules influx and the input/output ratio for joules is in freefall.

There is no fix for this.  Get your money out of all things Wall Street and get up from your computer.  If you live in a city, drive out of it.  Find some farmland.

Only calories will have value.  Soon.

Wed, 06/26/2013 - 20:38 | 3697409 jon dough
jon dough's picture

Spot on, +1...

Wed, 06/26/2013 - 20:49 | 3697449 Bring the Gold
Bring the Gold's picture

Wait why is Peak Oil and conspiracies of power elites in ANY WAY mutually exclusive? I've always figured they realized about Peak Oil in the mid to late 1990's and well you've seen what has happened since. All the security stuff is DUE to peak oil, they didn't need it this hyped up until they feared collapse and loss of control. On the way up they didn't need to conspire nearly as much although they certainly did!

Wed, 06/26/2013 - 22:03 | 3697642 CrashisOptimistic
CrashisOptimistic's picture

They are mutually exclusive in that the Wall Street elite hear about this oil stuff and pay the top consultants in the field to come educate them.

Those consultants get hired every year by oil firms to come talk to their executives.  Now, in case you've never seen how consultants are chosen, I will let you know -- the guy who says what management wants to hear gets hired, over and over.  After a few years (decades) he looks in the mirror and thinks, damn, I'm making serious money saying this stuff.  I have no reason to say anything different.  In fact, given I'm making this money, maybe it's even true!

So the consultants who say the industry has a bright future become the top consultants in  that field, and when Wall Street needs the top consultants in the field, those guys are brought to New York to say the same stuff.

That's why it's mutually exclusive.  The Wall Street folks believe the "experts" they hired, and those guys didn't get to be the "experts" by saying things management didn't want to hear.

Wed, 06/26/2013 - 23:41 | 3697972 MeelionDollerBogus
MeelionDollerBogus's picture

incorrect.
Calories expire, rot, are large to store, whereas money doesn't expire, rot, is high density to store in trade value.
With no money to store, there's no way to get calories that only come from somewhere else and they all do.
No farmer produces EVERY crop for every stomach. They diversify. They can barter. Barter means trade & trade means dislocated markets by TIMING (seasons, distance to travel, growing time differentials for desired crops).
That means we need MONEY, not just energy. Without money (unit of account) we have only RECORDS of account (debt). One has counterparty risk (debt), the other does not (money: gold, silver).

Thu, 06/27/2013 - 12:46 | 3699605 Weisshaupt
Weisshaupt's picture

Money does indeed have counter-party risk- the risk that somone else in the future will not accept your symbol for value 'money" because that symbol is not freely accepted as such. The dollar is money now because there is currently a high expectation that you can use it directly in exchanges for goods and services.  Gold and Silver  is NOT currently "money" because the expecation is that you would need to exchange it for some other medium of exchange before using it in most transactions, and where it IS used, it is a barter transaction where its value in the exchange is negotiated.  The prices of goods and services are simply not commonly demoninated in gold or silver.  If calories become significantly  hard to find  gold will not be money, because you can't eat a shiny rock, and the expecation you can trade your shiny rock to acquire calories with nearly everyone  is not high.  Money is, of its nature, an agreement of a community to use some symbol as a durable  standin for value - for work and production.  That symbol can be anything: gold, silver, shells, and bits paper - bits of data, but without wide  agreement  its not money, and  that gives money a distinct counterparty risk.

There is certainly a potential here in the short term  for a world  in which calories do not come from a far away place,  that perishable food and ammo are the units of exchange for work and value, and shiny rocks  will not be substitutes for those commodities.  It may come in time, because you are right that  we "need" money, but in times so socially violent that a wide and  peaceful agreement on a symbol is impossible,  money will cease to exist.. 

 

Thu, 06/27/2013 - 16:59 | 3700905 MeelionDollerBogus
MeelionDollerBogus's picture

That is NOT what 'counter party risk' means.
Counter party risk means you may have nothing at all because it's in the hold of a counter-party (not you).
FUTURE VALUATION risk is a different kind of risk, just as THEFT / security is another factor of risk.

In the past, gold & silver have been highly valuable money with food VERY hard to find or harvest.

Wed, 06/26/2013 - 20:13 | 3697338 blindman
blindman's picture

no legitimate government in the usa will confiscate precious metals.
period. think about it. that is all part of the drop pm price
discovery horror propaganda. just buy the stuff, if you can, and
stash it out of reach. oh, my. just do it and feel good about it,
the ptb are making it possible, wink wink, nod, nod. gift horse,
mouth, do not look! buy it and stash it you freak!

Wed, 06/26/2013 - 21:41 | 3697576 Imminent Crucible
Imminent Crucible's picture

"no legitimate government in the usa"

You got that part 100% correct.

Wed, 06/26/2013 - 22:52 | 3697822 blindman
blindman's picture

26 June 2013
Gold Daily and Silver Weekly Chart - Staggering Into the End of Quarter
"I think we are nearing the end of the exercise in inventory adjustment and buying patterns that started in October.
While it most likely had its impetus in the official, in practical implementation it smells like asset stripping to me.
That is another term for a 'stealth confiscation' through price manipulation." ...jca
....
here the rest .."But why speculate. Let's see what happens.

Gold is still flowing from West to East. There is no doubt about that.

I just wonder how many of the Banks and their friends are using this opportunity to wet their beaks now, and even feather their own nests for the future.

Am I being too cynical? Are serious? What market haven't they rigged lately?" jca

.
http://jessescrossroadscafe.blogspot.com/2013/06/gold-daily-and-silver-w...

Wed, 06/26/2013 - 20:16 | 3697352 blindman
blindman's picture

term to research, "trust",
in the financial and other domains.

Wed, 06/26/2013 - 21:57 | 3697626 slimething
slimething's picture

Ben willl do what BIS tells him to do.

Wed, 06/26/2013 - 22:26 | 3697735 Angry White Dude
Angry White Dude's picture

Good article except I disagree with proposition that "this central bank so wants to be loved". No gov't cares if it is loved, it only cares that it maintains absolute control. Some regimes do it through brutality and fear, some through bread and circuses, but perpetuation of control is all that matters. The US is historically a bread and circuses construct.

 

The primary risk and most probable trigger for acute civil unrest in the US is a disorderly and extended disruption of our just-in-time food supply chain to urban areas (to include potable water supplies). The US simply does not have a critical mass of people who live is sufficient privation for the US to see mass unrest by the "poor" -- "ObamaPhones" and EBT cards and the other tools of institutionalized, generational dependency on the state will ensure the docility of the great unwashed masses unless and until the JIT supply chain that fuels those programs is disrupted. And if it ever is, then that's when the clock will start to run on whether the status quo powers that be are able to maintain their control. We already know the tools they will use to try to maintain control - the executive orders in place allowing for nationalization of all food, energy and infrastructure (trucks, trains, plane, shipping, etc.) and the DHS, National Guardm and federal military forces to enforce it.

 

As I have argued before, the US produces enough food domestically to supply its basic needs. Nobody in the US need go hungry based on what is and can be produced here. And any shortfall in available energy supplies to produce and distribute that food will simply be met with restrictions on non-governmental usage of energy.

Thu, 06/27/2013 - 07:48 | 3698552 Downtoolong
Downtoolong's picture

Wanting someone to love you doesn’t imply you want to love them back or even do what’s best for them. Love is a powerful emotion that can be used as a tool; even a weapon. I interpreted the author’s words to describe a situation where one entity establishes a false positive relationship with others primarily for the purpose of controlling and manipulating them. Anyone who has ever been overly nice to another primarily for the purpose of getting them into bed can probably relate to that concept.

Thu, 06/27/2013 - 07:55 | 3698563 Bearwagon
Bearwagon's picture

Right! Further, anyone who has ever been overly nice to another primarily for the purpose of getting them into bed - didn't show any sign of love by that behaviour, but instead demonstrated just a lack of self-steem.

Wed, 06/26/2013 - 22:26 | 3697737 logicalman
logicalman's picture

I'm with you pretty much all the way, but I have to ask why only 'Americans' should have these rights?

Countries are just the fences between fields that make controlling the livestock possible.

I do NOT consider myself as livestock and never will.

Fuck borders - every person has the same rights to life.

Wed, 06/26/2013 - 22:35 | 3697765 Angry White Dude
Angry White Dude's picture

And bail-ins are definitely coming. The SEC's proposed changes to money market fund redemptions is just the start. Coming soon to savings and checking accounts. Cash in hand will be king.

Wed, 06/26/2013 - 23:38 | 3697967 MeelionDollerBogus
MeelionDollerBogus's picture

is it just me or could the article be completely distilled to:

"ZIRP = DERP"

+

"Gold, bitchez"

Thu, 06/27/2013 - 07:24 | 3698518 Cian
Cian's picture

QE for asset purchases has largely failed... why not QE to reduce income tax burden. Increased disposable income transmits directly into consumption, jobs and delveraging with a secondary influence on asset prices...

On the basis QE is happening and getting away from it without bursting bubbles across the board will be almost impossible, does anyone have solid reasons that this policy would not work?

I'm not asking if QE is good or bad. I'm saying that with the markets hooked does this not represent a change to more of the same... the same looking increasingly like its going to kill the patient like a morphene overdose...

 

 

 

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