Chicago Fed's Evans Unveils Federal Reserve's 2014 Year-End S&P 500 Price Target

Tyler Durden's picture

Minutes ago, the Chicago Fed's Charlie Evans went dove-retard and tongue-in-cheekly announced that QEternity may have to be increased by 50% in the coming year!

Ignore the fact that the US deficit will be less than half this number in the coming year. More importantly, based on what everyone now knows is the only driver of US equity "market" performance, the Fed is implicitly announcing its 2014-year-end target for the S&P 500 of 2,220 - so BTFATH (because it's the fundamentals that matter).



Of course, the question is what happens when the Fed owns the entire Treasury and MBS market? Obviously, nothing bad. Or maybe something, because recall that currently the Fed is monetizing 0.3% of all 10 year equivalents per week, 15% per year. It currently hold 33% of the bond market. Should it hike QEternity by 50%, it means the Fed will own a ridiculous 57% of the entire bond market in 10Y equivalents on December 31, 2014.

And that is how reserve currency status is lost.

h/t @Not_John_Lohman

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Dollar Bill Hiccup's picture

You're in good hands ...

VD's picture

jail that motherfucker for out/in-sider trading!

ZippyBananaPants's picture

Finally, some good timing on my part.

I just loaded up on NFLX!!

Cramer would be proud!!

knukles's picture

God damn! 
I can stick my whole arm in there right up to my elbow without jelly!

haven't had this much fun since the showers at Pelican Bay*


*aka being fucked by criminals

knukles's picture

Notice: No Oligarchs Were Harmed During This Theater of the Absurd Press Release

Stackers's picture

They can buy my Wayne Newton autographed record collection for $10 billion.


You will notice he said "assets" not "bonds"

ParkAveFlasher's picture

Money is an asset, debt is money, lack of money is debt, requires a loan, therefore lack of money is an asset.  Capital may be financed by a loan, loan being debt, the loan comprised of money, which is debt (see above).  Equity is the transmutation of debt, that you must create more debt to cover the transmutation to equity, thus more debt is more equity.

EDIT: </sarc>

Hang on to your Wayne Newton collection.  Your price target may soon be exceeded. 


King_of_simpletons's picture

America is a Plutocracy. Plutocrats control the masses.

bunzbunzbunz's picture

BTC Target.....99999999^99

Not alot, but still FREE BITCOINS:

old naughty's picture

Let's see...risk on US equities, no foreign money flow back in...all other curriencies down...Liquidity dry up...Asia (housing +) bubbles burst...

all assets drop, au+ag up(+ Bitcoin?)

hummmm, too straight forward...

something is stirring !

FL_Conservative's picture

And let me guess, right after Evans' comments, gold and silver sold off another 1-2%.  I mean....that's the way this "market" is supposed to work, right??


Fucking farce.....These assholes are going to print until their fucking eyeballs fall out, but PM's won't get bid.

ebworthen's picture


I've been saying it since Yellen's nomination; that bitch is going to do $170 Billion a month straight to Wall Street until Main Street bleeds out - then it will be "no one saw this coming" and bailouts part deux.

The U.S.S.A. has gone full retard, all engines full steam ahead toward the iceberg, no common sense or sanity left.

HardAssets's picture

With a bought off 'press'

And a dumbed down populace, (that parrots what the 'news' tells them, if they pay attention at all) - - -

it seems they can say just about anything they want.

PeeramidIdeologies's picture

Now don't get me wrong, I don't condon the act of sitting infront of the TV and absorbing eveything displayed as fact. But I do believe it is beneficial to be aware of what they are attempting to portray in the media. I call it an all-inclusive perspective.

Shad_ow's picture

You guys make the continued raping of our country bearable. Thanks for the laughs!  Simpletons, like me, need everything we can get for free these days.

Flatchestynerdette's picture

My tax dollars at work knukles - everyone go long s&p futures. Ride the wave.

Happy Holidays! Courtesy of the US Treasury and Federal Banking system.

Sam Clemons's picture

Technically, your tax dollars are unneeded.  But you still have to pay.

CrashisOptimistic's picture

Jaw dropping moment:

Senator McCain will not back Yellen for Fed chair.

max2205's picture

And I thought we went full retard with QE3.....

hedgeless_horseman's picture



We may need to purchase 1.5 trillion in assets until January 2015

And just like that Evans saved or created 4 points on the S&P 500.

knukles's picture

Which Instantly saved or created 4,238,944.23 full or part time jobs by the Commerce Department and BLS's very own Sophist and Statistical adjustments.

SoberOne's picture

Never go full dove-retard.

Bay of Pigs's picture

I thought he was the hawk?

akak's picture

At the Fed, they're ALL hawks --- and we're all mice.

HardAssets's picture

Bay of Pigs: " I thought he was the hawk? "

No, they're all vultures and vampire bats.

Nobody For President's picture

Hey knuks, you must be doing good, maybe even God's work, because somebody is downvoting each and every one of your posts.

Good job!

knukles's picture

That be da troof, my brother.

I done went an pissed somebody off, poor bugger.

I haven't gotten into somebody's head like that in ages.
And I wasn't even trying!


kaiserhoff's picture

Only the elite earn their own personal troll.


Lewshine's picture

1.5 trillion in new print should take Gold down to...let say...$800 an oz?? Yeah, it all makes sense.

rubearish10's picture

Hmmm, if you're going to report all the great moves you make, please also report your mistakes. Otherwise, nobody gives a shit!

knukles's picture

Eddie Bernays would get very, very annoyed at that attitude.
That's no way to run a Perceptions Management and Propaganda Media Mechanism

SillySalesmanQuestion's picture

ALLFED, the good bond people. Trillions you can count on...

HardAssets's picture

I've heard some say they think theyre buying more than the stated $85B per month now. They didnt provide any evidence for that claim however. Supposedly from an 'insider'.  Who knows.

ZH Snob's picture

that's just the soft sell.  they will be forced to double QE very quickly in the coming year, then in half the time it took to double the QE it will be doubled again, then half that time... and so forth.

that is the mathematical nature of exponentiality.  that is how currency becomes worthless in time.

Cdad's picture

"Of course, the question is what happens when the Fed owns the entire Treasury and MBS market?"


The US defaults...and finally...finally...we End the Fed?

Ham-bone's picture

Don't mean to beat a dead horse - but the Fed is not working alone here...there is massive collusion among the Fed and "foreigners" who have been buying US T debt even faster than the Fed..."foreigners" own a record 50% of all Notes/Bonds / TIPS...the Fed "only" 20%



  • GDP $9.5 T
  • Marketable debt = $3.3 T  (blended interest rate of 6.4%)
  • Non-marketable debt = $2.3 T
    • Fed           2% of Notes/Bonds/TIPS ($50 B)
    • Foreigner 30% of Notes/Bonds/TIPS (890 B)




  • GDP $13.7 T
  • Marketable debt = $5.1 T  (blended interest rate of 5%)
  • Non-marketable debt $4.1 T
    • Fed  4% of Notes/Bonds/TIPS ($200 B)
    • Foreigner  42% of Notes/Bonds/TIPS ($2.2 T)




  • GDP $16 T
  • Marketable debt = $12.2 T  (blended interest rate of 2.3%)
  • Non-marketable debt = $4.9 T
    • Fed           22% of Notes/Bonds/TIPS ($2.2 T)
    • Foreigner  50% of Notes/Bonds/TIPS ($5 T)


fonzannoon's picture

Ham-bone what happens when the fed owns it all? We just go JGB right?

Ham-bone's picture

What's really fascinating is that domestic Treasury ownership (ie, institutional folks) (ex-Fed) has remained about $2.5 T since '00 (+/- .5 T) while Public debt has grown by $9 T...guess who would be destroyed by an equity market crash???  pensions, insurers, etc.). 

Almost like if you wanted to destroy the US you would massively in-debt the nation but make sure all future payments (reparation???) only go to foreigners and the Fed???  That is exactly where we are heading???  Like a 30/70 split between the Fed and "foreign" buyers???  While at the same time intra-governmental debt has likely max'ed at about $5 T and will begin to more interest on debt leaving US to foreigners and less and less interest paid back...less money velocity / money multipliers

fonzannoon's picture

If you ever want to get into this ham-bone let me know, we can talk offline. There is a lot to it.

kaiserhoff's picture

Good points.  Minimal effect on GDP and headline numbers.  Continuing bleed out of Gross National Income, Cap Ex, and cash flow.  Plenty of jobs, since everything is going part-time or temp.  No way in hell to earn a living.

To succeed you have to be a government drone, or part of the free shit army.

seek's picture

$1500B / 12 months = QE of $125B a month. That's an increase from the $85B a month, no?

Sounds like someone is really confident about the "recovery."

fonzannoon's picture

"Of course, the question is what happens when the Fed owns the entire Treasury and MBS market? Obviously, nothing bad."

Does ZH care to put in a guess as to what happens? Because all I see is the Nikkei and JGB market in our future.

NoDebt's picture

Fonz, seek, ANYBODY.... is this a joke or is it not a joke?

fonzannoon's picture


that is a real tweet. I don't think they have reached the point of being stupid funny like us....yet.

seek's picture

Everything I'm reading in the tweets seems sincere. Completely fucking insane, but sincere.

Cut & pasted:

- our purchases will continue to be open ended. We may need to purchase 1.5 trillion in assets until January 2015

- the Fed believes it has the propery tools for risk management.

- we are continually monitoring risk issues; we feel the the benefits of our policy outweigh the costs.

- in the 1970s, we had a wage-price spiral, which we are not seeing today.

- we would like to see the labor market strengthen so we could change our strategy

- when the time comes to unwind, we will try to sterilize our assets, possibly via reverse repos & interest on excess reserves

- I look forward to the day when we can begin to unwind.


I honestly don't know what to say to this. It's like they're aliens at this point.

NoDebt's picture

Wow.  Just wow.

Now the Fed test-floats new policy on Twitter before they make an official announcement?  Did they recently take a meeting with Carl Icahn about this?

Nobody For President's picture

Hey Fonz, calling us zhers stupid funny - speak for yourself. I'm just stupid.