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When It Comes To The Fed Chair - Size Matters
While they often say it is not the size (stock) of the wave (of liquidity) but the motion (flow) of the ocean, as the following chart forewarns, the diminutive Janet Yellen faces a correlation crisis before she even enters office...
(h/t @Not_Jim_Cramer)
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Patsy
In this case metallurgy matters too.
I think the strength of titanium in the chair’s supporting structure and its corrosion resistance is called for.
They better get her a WIDE chair...just saying
All that matters these days is the number of dollars produced by the Grand Wazoo of the Fed and how easily the corrupt banks can get that money and use it to manipulate markets.
NOTHING else matters.
..volume of money and corrosive gas out the Fed wazoo in the reason for the titanium.
I am guessing that is S&P 500 Nominal Return.
Priced in gold, looks like Greenspan has the edge over Big Paul.
Sorry to nitpick but that graph needs to use a log scale. Otherwise the graph is distorted as the S&P priced in gold gets close to zero. We're nowhere near the extreme level we reached in 1980.
Here's what the graph looks like from 1968 onwards on a log scale. Ignore Y axis labels as FRED won't let you do the usual log plots when you do arithmetic:
http://research.stlouisfed.org/fredgraph.png?g=nn0
(What a log scale does in plain English is the same % moves take the same amount of vertical space. So if the S&P doubles vs gold, it is the same distance on the chart as if the S&P gets cut in half vs gold.) (I didn't junk you btw, not that you care.)
@socalbeach, You are spot on (pun intended). The sad reality is that no one wants to see reality. Its all about how sensationalized you make the story. Its interesting to note that on the FRED chart it looks like the SP/Gold ratio has broken above its recent down-trend line, which started around 2001. Does this mean that the ratio will continue its new up-trend for a few years? Who knows?
Maybe at least one more gold slamdown once a budget deal is reached, then I'm a buyer (I sold most of my gold in 2011). See my post here. There's no guarantee it doesn't go lower still, but there's nothing totally safe anymore, including holding dollars.
Chart looks more like a perfect correlation between dovishness/hawkishness and S&P returns.....
Not distorted for anyone that can read a scale.
I think you missed the point.
As your graph approaches zero (in 1980), you can't read the scale because there's almost no vertical distance between say 1/4 to 1/2 to 1 to 2 to 4. A log scale would show those doubles in the ratio as equal distances.
So on the log graph I linked to above, you can easily see that from the peak in mid 1976 to the bottom in early 1980, the ratio goes down by the same factor (0 to -2.0) as it went down from early 2000 to the bottom in late 2011 (from 1.5 to -0.5). On your graph the ratio drop starting in early 2000 obviously looks a lot larger:
http://img34.imageshack.us/img34/269/c4ot.png
(Because of a quirk in the FRED software, a drop from 0 to -2.0 or from 1.5 to -0.5 is a factor of 7.4 (e2)).
You don't need to use the FRED software. Get a copy of R and install the quantmod package.
You can then get all the FRED data raw and plot it as you please.
log scale is not appropriate in this case because it's not a chart of price vs time for % returns. It's a comparison of one price vs another as measured in dollars in common, which given inflation & various other currency fluctuations means there's no purpose whatsoever in making it log scale.
I believe you meant tungsten instead of titanium.
Titanium metal is coated with an oxide layer that usually renders it inactive. However, once titanium starts to burn in air, it burns with a spectacular white flame,
Does that chart mean Yellen has negative height?
Well, being a woman, she's yet to break the glass ceiling.
Beware the dwarf!
The great and powerful Oz.
So if Robert Reich was Fed Chair we'd have negative 15% return?
Holy shit! Is that a "Foul Play" reference?
This graph is ass.
You're right. Although not exactly verticle you can see that Planet Yellen aligns with the planet Urectum.
Best chart ever.
Especially if the units are in Inches, and "Size" refers to...
;-)
But who better to blow a bubble than an oompa loompa.
Unfortunately for the skanky ho, Janet Felon, she will be taking all the heat for when the SHTF. Berskanky and Greenspan will be laughing their asses off at her.
Until she joins them in their 3 bedroom shared apartment in Tel-Aviv. Beer and Matza until then. Cheers.
The height of a Keynesian does not matter, they are all counterfeiters.
...of the tallest order.
Woman bag holder.
Let me correct that to ALLEGED woman.....bag lady...or old bag....your choice.
Crash coming, in 5,4,3,2,1....
Damn, R-squared must be about 0.99. Oh boy, are the markets in trouble.
5'? I didn't know they could stack shit that high.
Shape into bricks and dry. Stacks like gold, but without the shine.
It seems that Tyler may be running out of material...
No, Keynesian monetary policy is running out of material. Tyler just reports on it. Once you've seen the only trick they can do a couple of times it becomes less impressive and, eventually, boring, though it loses none of it's actual destructive power with each performance.
Sure, the (not really) Federal (with no) Reserve is a "one-trick pony". Their play book is pretty simple: "Print" FeRNs to save their shareholder banks and enabling minion gubbermint...until they can't.
Keynes advocated gubbermint borrowing & spending to "stimulate" the economy. I still remember when the teacher explained this theory in high school (in the 1970s), it didn't make any sense, even to a teenager. But even Keynes didn't envision a central bank conjuriing unlimited amounts of "money" out of thin air for this purpose.
Still, I'm not sure there is a correlation between the height of the head bankster sock puppet and the return on the S&P 500, much less cause & effect relationship.
Perhaps it's the GMOs they're eatting. They do tend to come out smaller and less healthy nowadays. ;-)
reTARD 2.0 now jellin with Yellen.
Are the jewish people shrinking en masse? the govt will do a study I'm sure
This new Fed chairman is neither short nor female nor a kid. She is Rothschild.
Ron Paul’s appraisal of Janet Yellin indicates she may even end up “being Ben Bernanke on steroids.”
As former Texas Congressman Ron Paul noted in this week’s “Texas Straight Talk”, “there wouldn’t have been a dime’s worth of difference between Yellen’s and Summers’ monetary policy.”
“Yellen, like Bernanke, Summers, and everyone else within the Fed’s orbit, believes in Keynesian economics. To economists of Yellen’s persuasion, the solution to recession is to stimulate spending by creating more money. Wall Street need not worry about tapering of the Fed’s massive program of quantitative easing under Yellen’s reign. If anything, the Fed’s trillion dollars of yearly money creation may even increase, Paul said.
“As a result, the American people will continue to suffer decreases in the purchasing power of the dollar and a diminished standard of living. The phony recovery we find ourselves in is only due to the Fed’s easy money policies. But the Fed cannot continue to purchase trillions of dollars of assets forever. Quantitative easing must end sometime, and at that point the economy will face the prospect of rising interest rates, mountains of bad debt and malinvested resources, and a Federal Reserve which holds several trillion dollars of worthless bonds.
“The future of the US economy with Chairman Yellen at the helm is grim indeed, which provides all the more reason to end our system of central economic planning by getting rid of the Federal Reserve entirely. Ripping off the bandage may hurt some in the short run, but in the long term everyone will be better off. Anyway, most of this pain will be borne by the politicians, big banks, and other special interests who profit from the current system. Ending this current system of crony capitalism and moving to sound money and free markets is the only way to return to economic prosperity and a vibrant middle class.”
http://www.theglobaldispatch.com/ron-paul-janet-yellin-might-even-end-up-being-ben-bernanke-on-steroids-2602
Definitely not the time for an African-American basketball player becoming the FED chairman.
The shorter they are, the more they print.
The FED chair shrinking height corrilates to shrinking gold, shrinking effectivness, and shrinking credibility.
Word is that Yellen has a huge hammer (anteater though).
This is the kind of chart that Krugman would show on his blog if it told a story he wanted to tell.
Short people got no reason...