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Guest Post: Alan Greenspan's Shock Revelation

Tyler Durden's picture




 

Submitted by Bill Bonner via Acting-Man blog,

Alan Greenspan’s Shock Revelation

We really can't forecast all that well. We pretend that we can but we can't. And markets do really weird things sometimes because they react to the way people behave, and sometimes people are a little screwy.”

 

– Alan Greenspan, speaking this week on “The Daily Show”

 

“Jobs Report Leaves Fed in Doubt,” was a big headline on Wednesday morning. Later in the day came this: “Dow down 54 on jobs concern.” What is the Fed in doubt about? To taper, or not to taper, that is the question. And why should a jobs report make any difference?

Oh, dear reader, where have you been? Don’t you know everyone now sits on the edge of his seat wondering when and how the Fed will back off from its massive QE program? And don’t you know the future of civilization hangs in the balance? On that point, we have a position… a thought… a reaction. Civilization hangs in the balance, but not in the way you think.

 

Asking for Trouble

 We have been trying to introduce a new way of looking at civilization. In short, we’ve tried to make it more civilized. What is the difference between a civilized community and a barbaric one? We have introduced a simple test. The civilized community relies mostly on cooperation and consent. The uncivilized community depends heavily on force and violence.

A French historian first introduced the word “civilization” less than 300 years ago. Since then there has been much argument about what it means. We enter the fray gingerly, but sure of ourselves. It only makes sense on our terms. A civilized community is peaceful; a barbaric one is not.

“Okay, Bill,” you may be saying to yourself. “I’ll give you that one… I guess. But what the hell difference does it make? What has it got to do with the jobs report?” Good questions. Glad you asked.

We know from bitter experience that trying to force economies to do what you want is a thankless task. Markets are fundamentally based on free exchange, cooperation, trust and trade. Force them in one direction or another and you are just asking for trouble.

As Alan Greenspan described this week, in an interview with John Stewart on “The Daily Show,” people are a little “screwy” from time to time. Which means they don’t necessarily go along with your central planning, no matter how good you think it is.

But still economists insist that, if they are allowed to monkey around with it, they can make an economy better. This is occasionally true. Said occasion is usually when they have already messed it up. By withdrawing some of their planning and programs, they may allow it to recover. Otherwise, there is no example in history where force has been successfully applied to economics.

 

Compounding Errors

But that doesn’t stop the PhDs from trying. The jobs report showed about 60,000 jobs missing – fewer jobs than economists had projected. Now, the erring economists will most likely compound their error by continuing to try to force the economy to do their bidding – force up the rate of consumer price increases and force down the number of Americans out of work.

If they really wanted to increase employment, that would be easy enough. They would encourage the feds to withdraw some of the laws that bully employers (health insurance… EEOC threats… overtime, etc.)… or some of the schemes that make it easy for potential employees to remain unemployed (disability… unemployment benefits… food stamps). As far as we know, those things are not on the table.

What is on the table is more QE. With regards to QE, the poles of possibility are as follows:

  1. QE does nothing important. If this were so, there would be no reason to keep it.
  2. QE is essential to the economy. If this were so, they couldn’t get rid of it… no matter what the jobs report says.

Most likely, QE lies somewhere in between… perhaps lost in the horse latitudes. It probably has little effect on the real economy. That is why the jobs report is so disappointing. But it probably has a great effect on the financial economy. That’s why the Dow sets new record highs almost every session.

The Fed is probably stuck with QE. Were it to stop, the stock market would likely tumble and the “wealth effect” the PhDs have been aiming for would quickly turn into a poverty effect.

Janet Yellen couldn’t stand it. She believes the Fed should use all its available weapons to force the economy to do what she wants it to do. She won’t be able to stand by, dagger in hand, when the market turns its back on her. Instead, she will stab.

And the Fed, which has lived by the sword of QE, will probably die by it too.

 

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Fri, 10/25/2013 - 12:48 | 4090426 schoolsout
schoolsout's picture

Human Action - von Mises

Fri, 10/25/2013 - 12:52 | 4090440 Headbanger
Headbanger's picture

What's that Al?  You mean the teachings of your mentor Ayn Rand still left you clueless to reality?  What a shock, huh, you theoretical dolt!

Fri, 10/25/2013 - 12:56 | 4090468 SGS
SGS's picture

Muh nigga greenspan said that? Sheeeeet taime to burn this motha fucka down.  Go get me some grape drink on jerk chicken son, we need to fire them algos up now....

Fri, 10/25/2013 - 18:58 | 4090578 Boris Alatovkrap
Boris Alatovkrap's picture

Google is cannot translate, please to re-phrase. Boris is have problem of similar to interpret Obama speech ("uummmm" - that is real English word...?)

Fri, 10/25/2013 - 23:47 | 4092300 All Risk No Reward
All Risk No Reward's picture

(note - formatting off due to copy / paste operation)

Please don't be a chump.  Alan Greenspan is a CRIMINAL, not some academic moron.

Pretend inferiority and encourage his arrogance.
~Sun
Tzu

For those of you who can't "get it," the key word is PRETEND.

Read it until it sinks in.

Greenspan is a black letter law criminal who knowingly lied about the Federal Reserve Mandate for decades (see linked PDF), he knowingly broke the mandate and took credit and monetary aggregates exponential to realized production potential.

Greenspan's Crime Spree Expressed Graphically
http://www.keepandshare.com/doc/4768883/debtmoneytyranny-6-1-pdf-60k?tr=...

You do get how a criminal who destabilized your country and community ahead of its eventual impoverishment is best seen as a fool instead of knowing Machiavellian DEVIL, don't you?

BTW, if you want a quick go-no go test as to whether you are still in the Matrix or not:

1. The Fed mandate is to keep unemployment low and prices stable

2. The Fed's mandate is to keep credit and monetary aggregates commensurate with the long term productive potential of the country

If you answered #1 then you are still in the Matrix - or in the "consensus trance."

http://www.cantrip.org/charles_tart.html

http://www.infowars.com/breaking-the-zombie-programming-we-can-become-co...

Look up "Section 2A Federal Reserve Act" and read it as many times as is required for it to sink in.

The law's text is included in the PDF linked in this post... but you should always go to the source document lest you get duped.

If you chose #2 and realized this means EVERYONE IN THE ESTABLISHMENT HAS LIED TO YOU FOREVER ABOUT IT, well, you've taken the red pill.

Fri, 10/25/2013 - 23:59 | 4092323 All Risk No Reward
All Risk No Reward's picture

Janet Yellen is a Muppet.  She does what she is told.  The supra-national banking cartel will have their puppet do what they want WHEN IT SERVES THEIR INTERESTS.

If you are looking at Yellen, you are duped.  You've been cognitively pwned, as the kids would say today.

Look, Ayn Rand, Greenspan's alleged philisophical mentor (that was a hoax, too), would not have bailed out the criminal banking cartel.

A chump would argue that Greenspan wouldn't bail out the banks because he was an Ayn Rand acolyte.

Greenspan was told by the Fed Board and its controllers to bail out the banks (who were on the Fed's Board and who control the Fed - isn't this con obvious?  Is everyone in an establishment  false consensus zombie?)

Yellen will issue more debt in as much as it supports the benefit of the supra-national banking cartel that controls the Fed.

When issuing new debt no longer serves their self interest, Yellen will be told to shut off the debt spigot.

And let me make one thing VERY CLEAR.

A valueless dollar DOES NOT SERVE THE INTERESTS OF PEOPLE WHO OWN TRILLIONS IN DEBT AND TRILLIONS MORE IN DEBT HOLDINGS.

A 5th grader has the mental capacity to understand that.

The trick is to offload their cash for hard assets (preferably for pennies on the dollar) and to convert their debt holdings into real assets... THEN HYPERINFLATION OF THE CURRENCY BENEFITS THESE CRIMINALS.

And ONLY then.

Sure, they are devaluing the dollar... but they gain 20% in looting the ignorant population for each 10% decline in the value of the currency FOR A NET GAIN.

THAT'S WHY THEY ARE ISSUING DEBT TO PRIMARILY OT THEMSELVES AND NO OTHER REASON.  They aren't trying to fix anything they know is broken BECAUSE THEY BROKE THE SON OF A B*TCH ON PURPOSE!

Exponential debt growth relative to GDP IS GUARANTEED TO BREAK EVERY SINGLE TIME!

Again, 5th grade math should be able to get from ignorance to enlightenment, but one has to focus on facts and shed the consensus trance that, apparently, feels so comfortable.

Fri, 10/25/2013 - 12:56 | 4090469 walküre
walküre's picture

I just wish I could believe what he says. Nobody is that dumb and casual about so much wealth, control and power and doesn't know every side effect of his actions.

The King had smart advisors and jesters. Greenspan and Bernanke make themselves sound like they're jesters but we all know they have the King's ear and then some.

Greenspan is selling himself short and trying to cover his ass. They all do.

Not buying it.

Fri, 10/25/2013 - 13:01 | 4090489 Grande Tetons
Grande Tetons's picture

Expect the unexpected with these cats. 

Trust the Fed? No chance. 

 

If I ever go long equities...I am certain the folllowing day there will be a market crash. 

 

Fri, 10/25/2013 - 13:10 | 4090498 fonzannoon
fonzannoon's picture

http://www.thedailyshow.com/watch/mon-october-21-2013/exclusive---alan-greenspan-extended-interview-pt--1

"People are a little screwy"???????

You put interest rates at fucking zero for more than half a decade and when you have asset bubbles blown everywhere it is the reaction of the "people" and not your action that is screwy? And if we have not gone along with their central planning by loading up on stawks and bonds and RE then what were we supposed to do?

Die.

Fri, 10/25/2013 - 13:14 | 4090537 Grande Tetons
Grande Tetons's picture

Die. Just those on EBT...would be their wish. Keep all the productives! 

Fri, 10/25/2013 - 13:32 | 4090591 Boris Alatovkrap
Boris Alatovkrap's picture

<-- Irrational exuberance of Bankster

<-- Citizenry is "little bit of screwy"

Sat, 10/26/2013 - 00:02 | 4092324 All Risk No Reward
All Risk No Reward's picture

<-- Cold blooded supra-national banking cartel Machiavellian jackal

<-- Cold blooded supra-national banking cartel Machiavellian jackal

Fri, 10/25/2013 - 19:09 | 4091679 Omen IV
Omen IV's picture

greenspan has systematically tried to convince the public that he made a mistake

his story is he didnt know the banking industry would commit systemic fraud end to end from the cut and paste mortgage applications to stuffing the CDO box with garbage to phony foreclosure documents coupled with fraudulent notary signatures to the point they would bankrupt their institutions for cash bonuses ---duh?

this is his attempt that he wasnt part of the cabal- absolving himslef of culpability  - but his fingerprints are all over the end of Glass Stegall and stopping Born on control of CDS which were the keys to the money making scheme of shorting the phony CDO's

he is not stupid he is a crook of enormous dimensions who is attempting a whitewash for the sheeple

 

a pure scumbag in a strict New York sense....which means he is irredeemable !

 

Fri, 10/25/2013 - 13:40 | 4090646 schoolsout
schoolsout's picture

Ayn Rand taught him well...as well as the Austrians.  He is, simply put, a turncoat.

http://www.constitution.org/mon/greenspan_gold.htm

Fri, 10/25/2013 - 13:28 | 4090573 4 wheel drift
4 wheel drift's picture

is it ever !!!

Fri, 10/25/2013 - 12:48 | 4090429 stinkhammer
stinkhammer's picture

fuck it dude, let's go bowling

Fri, 10/25/2013 - 12:52 | 4090433 Dewey Cheatum Howe
Dewey Cheatum Howe's picture

As Alan Greenspan described this week, in an interview with John Stewart on “The Daily Show,” people are a little “screwy” from time to time. Which means they don’t necessarily go along with your central planning, no matter how good you think it is.

 

One man's screwy is another man's freedom.

 

Alan must see the writing on the wall. If putty face is calling us screwy, I'll take it as a badge of honor.


Fri, 10/25/2013 - 12:53 | 4090454 socalbeach
socalbeach's picture

Sounds like Greenspan is trying to pass the blame onto others with his "people are screwy" comment.

Fri, 10/25/2013 - 12:55 | 4090463 Dewey Cheatum Howe
Dewey Cheatum Howe's picture

That is exactly what he is doing. Sociopaths can never accept they might be wrong sometimes.

Fri, 10/25/2013 - 12:50 | 4090435 DavidC
DavidC's picture

"And the Fed, which has lived by the sword of QE, will probably die by it too".

Hurrah.

DavidC

Fri, 10/25/2013 - 13:13 | 4090532 Cursive
Cursive's picture

@DavidC

Probably?  No two ways about it, the Fed will not be standing 20 years from now.  Of course, we may be walking around in rubble by that time and President Christie will have declared martial law, but at least the Fed will be gone...so we have that to look forward to.

Fri, 10/25/2013 - 12:50 | 4090436 Its Only Rock N Roll
Its Only Rock N Roll's picture
“Everything is changing. People are taking their comedians seriously and the politicians (and Fed governors)as a joke.”

 

~ Will Rogers

 

 

Fri, 10/25/2013 - 12:50 | 4090437 BliptoP3
BliptoP3's picture

No shit Sherlock - who codda knowd?

Fri, 10/25/2013 - 12:51 | 4090443 1835jackson
1835jackson's picture

Fractional Reserve Banking does not work stop making fucking excuses. 

Fri, 10/25/2013 - 13:13 | 4090535 NOTaREALmerican
NOTaREALmerican's picture

Re:  Fractional Reserve Banking does not work stop making fucking excuses. 

Worked pretty well for the top 1%.    They've been doing better and better for a few generations now.

Fri, 10/25/2013 - 12:52 | 4090444 Dewey Cheatum Howe
Dewey Cheatum Howe's picture

The hubris of man is thinking he is above the environment and can dictate terms 100% of the time. That lesson is going to be re-learned in a real hard way since no one ever learns from history.

Fri, 10/25/2013 - 12:52 | 4090448 Tsar Pointless
Tsar Pointless's picture

The Fed may ultimately die by QE, but these pricks will do everything in their power to ensure that we all expire first.

Fri, 10/25/2013 - 12:53 | 4090453 One And Only
One And Only's picture

 

You can't forecast well because you've never had a real job

Fri, 10/25/2013 - 12:55 | 4090460 The Fonz...befo...
The Fonz...before shark jump's picture

central planners act screwy the people just react accordingly...

Fri, 10/25/2013 - 12:55 | 4090461 1stepcloser
1stepcloser's picture

Where was all this candid speak on Humphry-Hawkins days, u prick

Fri, 10/25/2013 - 12:56 | 4090465 Dre4dwolf
Dre4dwolf's picture

Thats why the NWO (FED) wants to remove people from the equation.

Fri, 10/25/2013 - 12:58 | 4090481 1stepcloser
1stepcloser's picture

I thought the equation is to remove 80% of the people

Fri, 10/25/2013 - 12:58 | 4090473 Son of Captain Nemo
Son of Captain Nemo's picture

See that?...

That's the confidence of a piece of shit who knows the damage he did in his years as Fed Chief breaking the law and knowing he will never go to jail...

Talking to another Zionist shill on his "comedy show" about "something that is comical" but shouldn't be.

It's the same hubris we've witnessed when FOX and CNN bring in the likes of Dick Cheney to weigh in on the topic of NSA whistleblowers ironically being called traitors by a man who is a known psychopath and war criminal.

Fri, 10/25/2013 - 13:46 | 4090673 Nobody For President
Nobody For President's picture

And he is not too hot on hunter safety, either.

Fri, 10/25/2013 - 12:57 | 4090476 q99x2
q99x2's picture

The corruption has reached such intense levels that nobody cares what happens as long as they have the right to print themselves up money.

And so we have another Washington D.,C. globalist Friday with stocks up and gold down.

Happy Stop the NSA and Washington D.C. terrorists weekend. IT departments around the world are rocking and getting their tweak on.

Every occupation deserves a good resistance.

With each atrocity Washington D.C. attempts to inflict on people a real resistance forms until finally everyone is against them. ObamaCare may be the one that ends the globalists reign of terror.

Fri, 10/25/2013 - 12:59 | 4090479 Seize Mars
Seize Mars's picture

Yeah, we are supposed to laugh at the haplessness of this kindly old man. Me? I'm just waiting for the next false flag attack where Mr. Greenspan's friends murder a bunch of schoolchildren and then blame the Bill of Rights.

Fri, 10/25/2013 - 12:58 | 4090480 firstdivision
firstdivision's picture
  1. QE does nothing important. If this were so, there would be no reason to keep it.
  2. QE is essential to the economy. If this were so, they couldn’t get rid of it… no matter what the jobs report says.

Most likely, QE lies somewhere in between…

 


Actually QE impacts equity/bond prices and nothing more.  QE is not essential for the economy to recover, on contrary, it is quite the opposite preventing bad loans/entities from going bankrupt (CAPITALism).  QE helps keep the 1% from having to suffer an losses, but also redistributes that loss onto 99% of the US population.  So no, it doesn't lie in between.  It benefits 1% (the current non-productive portion of the population) and places the pain on the rest.  Sure if QE ended today markets would collapse, but then we would have true price discovery and find out that there were more IOU's written than assets available and sustainability would come roaring back. 

But then again I’m just a fucking idiot with no economic sense cause I studied maths and not pseudo-maths. 

 

Fri, 10/25/2013 - 13:16 | 4090544 Tsar Pointless
Tsar Pointless's picture

Fucking idiot. LOL

Fri, 10/25/2013 - 13:00 | 4090482 Atlantis Consigliore
Atlantis Consigliore's picture

"What Me Worry?"      Irrational diarrhea....Yellen has all the toilet paper dollars commin from copters and planes,  ready.

Fri, 10/25/2013 - 13:02 | 4090493 Bob Sacamano
Bob Sacamano's picture

Ah, the liberal tenet that "people are screwy" and therefore really must be managed / planned / helped in nearly every way.  "People" could not possibly know what is best for themselves.   Government knows best and their forecasts are always correct if people would just behave as government deems they should.  Alan and Andrea - perfect couple.

Fri, 10/25/2013 - 13:07 | 4090506 NOTaREALmerican
NOTaREALmerican's picture

Re:  the liberal tenet

Uhhh,  a show of hands of the number of Libertarians and "Conservatives" who used to have free-enterprise orgamisms when Greenspan used to speak?

Fri, 10/25/2013 - 13:19 | 4090548 moneybots
moneybots's picture

" "People" could not possibly know what is best for themselves. "

 

Generally, people don't know what is best for themselves, people know best what they want to do.

KNX news noted yesterday that those graduating from college will be paying off student loans untik age 33 and will only have 2,500 in a retirement fund.  They will as a result have to work to age 73, to have a comfortable retirement.

Fri, 10/25/2013 - 13:28 | 4090572 Chump
Chump's picture

Age 33?  Yeah fucking right.  If we paid the minimum payment on my wife's student loans, we'd be paying for 28 more years.  As it is we'll be done in 3, if "we're" not done before then.

How many new grads do you know that can even spell amortization?

Fri, 10/25/2013 - 13:02 | 4090496 laomei
laomei's picture

Economists are con artists and psychopaths, this is nothing new.  The economist models only work assuming all things stay constant and "rational", however the world does not work that way.  In the end, nothing but bullshit peddling monkeys in suits who prop themselves up with spreadsheets and eat their own bullshit.  Woe to anyone who actually listens to them.

Fri, 10/25/2013 - 18:38 | 4091584 Nick Jihad
Nick Jihad's picture

Yeah, but any time an economist recognizes reality and qualifies a prognostication, they're just fired and replaced with an economist who professes certainty.

Fri, 10/25/2013 - 13:02 | 4090500 NOTaREALmerican
NOTaREALmerican's picture

< Greenspan:   A key membert of the Masterminds of a world wide conspiracy?

< Greenspan:   A typical political hack of the kind that run all the world's governments?

Fri, 10/25/2013 - 13:06 | 4090509 moneybots
moneybots's picture

"If they really wanted to increase employment, that would be easy enough. They would encourage the feds to withdraw some of the laws that bully employers (health insurance… EEOC threats… overtime, etc.)… or some of the schemes that make it easy for potential employees to remain unemployed (disability… unemployment benefits… food stamps). As far as we know, those things are not on the table."

 

It is a bad economy that makes it easy for potential employees to remain unemployed, rather than benefits.  If government was more business friendly, that would help create more jobs.

Fri, 10/25/2013 - 13:12 | 4090524 NOTaREALmerican
NOTaREALmerican's picture

Re:  If government was more business friendly, that would help create more jobs.

Well, Big-Corp already pays almost no taxes.   The top 1% have been getting richer and richer for a few decades now, and own about 50% of the entire country.

What percentage of the country do the "job creates" need to own before they start create these mythical jobs?

Fri, 10/25/2013 - 13:27 | 4090566 moneybots
moneybots's picture

"What percentage of the country do the "job creates" need to own before they start create these mythical jobs?"

60% of the jobs are created by entrepreneurs and small businesses.

Fri, 10/25/2013 - 13:37 | 4090617 NOTaREALmerican
NOTaREALmerican's picture

Ok,   so what percentage of the country's wealth needs to be owned by the top 1% BEFORE the "entrepreneurs and small businesses" start creating jobs?

Or, is government policy that is Big-Corp and top 1% friendly DIFFERENT than government policity that is "entrepreneurs and small businesses" friendly?

What political Team like "entrepreneurs and small businesses" more than it likes Big-Corp or the top 1%?

Fri, 10/25/2013 - 13:12 | 4090522 29.5 hours
29.5 hours's picture

 

 

"She won’t be able to stand by, dagger in hand, when the market turns its back on her. Instead, she will stab."

Classic Bill Bonner. Used to get his newsletter but I guess now the NSA has them...

 

 

Fri, 10/25/2013 - 13:13 | 4090534 Absalon
Absalon's picture

That's just Greenspan trying to claim he had no way of knowing that Wall Street was corrupt to the core.

Fri, 10/25/2013 - 13:17 | 4090543 NOTaREALmerican
NOTaREALmerican's picture

Re;  That's just Greenspan trying to claim he had no way of knowing that Wall Street was corrupt to the core.

Show of hands of the OldFarts and nears OldFarts who used to have "free-enterprise" orgasms when Alan used to tell us that Wall Street was self-regulating because it was in their own interests to be so and we didn't need the evil hand of Big-Govmnt interferin' in the bidness of the hard-working bankers who made this great-n-glorious country great-n-glorious!

Fri, 10/25/2013 - 14:07 | 4090741 therevolutionwas
therevolutionwas's picture

Re: "free-enterprise" orgasms

No.  Greenspan apparantly had pretended to be a free market guy in the past.  When he got the Fed job I remember asking a freind what in the hell he was up to, wondering if he was perhaps pulling a John Galt by bringing down the dollar and  ending overpowering gov't. blah, blah, blah.

It wasn't until later I found he was an empty fraud.

Fri, 10/25/2013 - 14:25 | 4090834 KingTut
KingTut's picture

Hand down ...

I was facinated by Greenspan when he was chariman.  He had a way of wrestling the English language into something truly bizzarre and entertaining.  But I must say I was always a little suspicious.  As Richard Feynman once quipped: "if you can't explain it to a four year old, you probably don't understand it."  After some years have gone by, its pretty clear Greenspan didn't understand it.

The whole "the free market self-regulates fraud" thing always gave me the creeps.  Perhaps something like that works in a simpler society where eveyone knows eachother, and trust is based on experience.  But in a large annonymous society, we have to trust strangers just to keep the system going.  But you can't trust all strangers.  Some people just act with too much self interest and little regard for truth or fairness.  When dealing with strangers, these people only reveal themselves after the fact, when its too late.  If in that case we grab a gun and shoot the guy, the so-called free market becomes too dangerous.  One of the conerstones of civilization is judical redress: a standard of fairness and honesty that is enforced on would-be socio-paths.  It prevents the fraud, but it also prevents hot-headed vigillante justice.  Both erode the ability of large annonymous societies to function at the most basic level.

Fri, 10/25/2013 - 13:51 | 4090551 NuYawkFrankie
NuYawkFrankie's picture

'They' could "forecast" well enuf to asset-strip the economy 10s of $TRILLIONs - and collapse it along the way. 

I guess Alan must think we were all born yeterday.

Fri, 10/25/2013 - 13:25 | 4090560 4 wheel drift
4 wheel drift's picture

VINDICATION......

all those freak-onomists telling me i was wrong......

modern voodoo priests covering for the thugs, gangsters, liars, (aka politicians)

fuck LSE and all its affiliates fraudster schools of this pseudo-science.  they should be sued to return tuitions and de-thrones these arseholes of their "ivory tower positions"

Fri, 10/25/2013 - 14:14 | 4090587 W74
W74's picture

"and sometimes people are a little screwy"

Translation: MOAR GUB'MINT CONTROL OF PEOPLE NEEDED.

Fri, 10/25/2013 - 13:32 | 4090597 4 wheel drift
4 wheel drift's picture

And the Fed, which has lived by the sword of QE, will probably die by it too.

 

and not a nanosecond too soon !

Fri, 10/25/2013 - 15:08 | 4090997 polo007
polo007's picture

According to Macquarie Research:

https://app.box.com/s/pzbyrvapbxjs27ql0lnw

Banking on Unconventional Monetary Policy

Event

- We analyse the implications of maintaining current unconventional monetary policy (UMP) mechanisms in the major developed economies for some time into 2014.

Impact

- Financial markets are now expecting the US Federal Reserve to maintain its current program of QE bond purchases until at least March 2014. At the same time, several other major central banks have recently signalled an intention to maintain highly accommodative monetary policy settings for the foreseeable future. Consequently, the medium-term outlook for global liquidity has shifted and should be seen as supporting the strengthening cyclical upturn in the developed economies.

Outlook

- Recent actions and comments from the major central banks indicate that unconventional monetary policy (UMP) can be expected to remain a key feature of the global landscape well into 2014. This reflects a combination of factors, many of which have both domestic and global economic dimensions.

- Notwithstanding concerns in some quarters of financial markets that UMP is an unsustainable policy approach, central banks appear to assess the near-term risks of macroeconomic instability as being better managed through the protracted use of extraordinary policy measures.

- Moreover, the complicated nature of exit strategies for the major central banks, including the likelihood of further unsettling capital outflows from some emerging market economies, is leading to an acceptance that UMP will be sustained for longer than originally anticipated.

- We noted previously that the market consensus in respect to the US Fed’s commencement of a wind back in its quantitative easing (QE) asset purchase program has shifted into 2014. Indeed, market expectations have now aligned with our base case of Fed QE tapering commencing at the 18-19 March 2014 FOMC meeting – although the risks are still skewed to an even later date.

- Given the ‘general equilibrium’ spill-over effects of any shift in the stance of US monetary policy, it is not surprising that most of the other major central banks have acquiesced with the financial markets expectation for a protracted deployment of UMP.

- In our view, there are three key macro implications for global investment markets in the extended use of UMP, namely:

- ongoing elevation of investor risk appetite and a focus on ‘capital growth’ driven assets;

- near-term abatement of ‘capital account’ pressures in several key emerging market economies; and

- persistent concerns about competitive exchange rate devaluations and asset price bubbles.

Fri, 10/25/2013 - 15:22 | 4091058 undercover brother
undercover brother's picture

It would have been nice if you mentioned this 20 years ago.  Now, when you're at death's door, you gain a conscience?  well, tough luck buddy, you're going to hell anyway.  

Fri, 10/25/2013 - 17:35 | 4091459 csodak
csodak's picture

I continut to laugh at the tidbits that I see on blogs about Greenspan...as I've tried to watch him as he is interviewed and I simply can't take it and to think the world hung on this mans dribble does prove that the world is screwy.

But when Greenspan says the world is screwy he actually means that they are human. They only appear screwy because prognosticators like Greenspan who have spent their lives practicing a discipline that requires as a condition of their success the ability to capture this screwy human behavior in their modeling to assure accuracy. Which explains why Greenspan failed.

Greenspan being the Ann Rander that he is thinks everyone should act as if the are part of what the Randiers belief systyem of supposed rational behavior. How fucked up and full of arrogance is it for the observer to think that observed MUST think like the observer. And who then is the irrational being the observer or the observed.

The cultists of Ann Rand of which Alan Greenspan belongs are the screwballs and the fact that they have gained the level of prominence and influence in world society demonstrates how fucked up we are and of course explains the elevated state of the stock market.

Mon, 11/04/2013 - 06:56 | 4118768 Khannea
Khannea's picture

I demand that governments help the most vulnerable people survive in this most diffcult transition to a new economic and macrofinancial state. I do not trust desperate, hungry people. People that find themselves to pay the bills for survival needs go crazy. They will become criminal. They will go on strike. They will vandalize, protest, block, sabotage, steal, radicalize, self-medicate and eventually commit suicide or commit acts of terrorism. 

Governments MUST act to protect the underclasses from their own inadequacy. If governments do not act the social upheaval could bring society down

Now on that note, I know a nice railway crossing with a lot of copper wiring in it nearby. Let's go there tonight with a crowbar and a cart and strip it empty. Should secure my rent and food intake for the next month.

 

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