Fed To Emerging Markets: "Hasta La Vista, Baby"

Tyler Durden's picture


Just out from Citi's Steven Englander

Fed leaves EM to twist in wind


From the viewpoint of domestic US economic conditions the Statement is completely anodyne. From the point of view of EM, the Fed has just said “hasta la vista, baby”. 


The comment on US growth was a not surprising upgrade in the growth assessment – economic activity ‘picked up’ rather than ‘is expanding at a moderate pace’, but very little else changed other than the expected USD10bn additional tapering. There were no dissents and no changes in the forward guidance language. Since the announcement MXN and AUD are down about 0.4%, so there is modest disappointment  in high-beta currencies. The S&P is down about 10points, taking down  US Treasury yields which initially spiked but have since dropped.


On these asset market conditions look to JPY , CHF and EUR to do well, commodity currencies and EM to do poorly.

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Wed, 01/29/2014 - 16:06 | 4381206 Headbanger
Headbanger's picture

Well it's about time seeing how China turned on us and bit the hand that fed them!

Wed, 01/29/2014 - 16:06 | 4381218 maskone909
maskone909's picture

other way around bro

Wed, 01/29/2014 - 16:15 | 4381273 Sudden Debt
Sudden Debt's picture

with the IRA money, Obama can buy up all the american bonds china wants to throw onto the market and he'll have CHANGE left to fight another war
China is checkmate at the expense of the American citizens

but it's the patriotic thing to do I guess...

Wed, 01/29/2014 - 16:20 | 4381304 Arius
Arius's picture

well, Gartman was right after all ... what you internet warriors got say for yourself now?  apology accepted!

Wed, 01/29/2014 - 16:37 | 4381420 Levadiakos
Levadiakos's picture

A Bigfoot hunter has released these fascinating photos of a mythical creature he claims to have shot and killed in Texas. Rick Dyer says he caught the 8ft tall furry beast in September 2012 in San Antonio and is now planning to embark on an international tour where the 800lb body will be made available for public viewing. The 36-year-old self-described 'Best Bigfoot Tracker in the World' warns there are more beasts out there

Read more: http://www.wmmbam.com/photos/main/news-highlights-946/#/0/22104778#ixzz2rp1SoMqv

Wed, 01/29/2014 - 17:26 | 4381667 stonecoldbrokei...
stonecoldbrokeinthemiddleofthewinter's picture

The mythical creature in the picture is  circumcised.

Wed, 01/29/2014 - 18:46 | 4382049 Hedgetard55
Hedgetard55's picture

Yes, and it appears Bigfoot is Asian, and not African!!!

Wed, 01/29/2014 - 17:14 | 4381612 SheepDog-One
SheepDog-One's picture

'All the IRA money'.....BAHHH HA HA HAAAA!!!

Wed, 01/29/2014 - 16:21 | 4381303 gatorengineer
gatorengineer's picture

I think this is actually all about crushing China......

Wed, 01/29/2014 - 16:27 | 4381345 WillyGroper
WillyGroper's picture

Given their gold holdings, you could be right.

War in   3...2...1

Wed, 01/29/2014 - 16:27 | 4381347 maskone909
maskone909's picture

its more like a game of chess.  only now its *check, move* and its china's turn.  Lets hope they dont liquidate their bond holdings. Then its *check-mate*

Wed, 01/29/2014 - 16:33 | 4381380 HardlyZero
HardlyZero's picture

Hmm...China wll survive in the end sice they have 1B population.

All the smaller population countries get wiped.

Walmart wil survive.

Wed, 01/29/2014 - 16:45 | 4381452 Bearwagon
Bearwagon's picture

Yeah, but it'll be named "Buttfucker's", or likewise ...

Wed, 01/29/2014 - 16:44 | 4381443 Headbanger
Headbanger's picture

BINGO!!   Congrats!  Somebody who can connect the dots!

Wed, 01/29/2014 - 21:52 | 4382765 Non Passaran
Non Passaran's picture

The dolar can outlive gold?
We'll see about that.

Wed, 01/29/2014 - 16:08 | 4381231 Canadian Dirtlump
Canadian Dirtlump's picture

Seems more and more likely that the US / West has the ability to stave off their own destruction by mailing the bomb to other countries. That's fine, the carnage will find it's way home at some point so let's start the party already.



Wed, 01/29/2014 - 16:16 | 4381277 Occident Mortal
Occident Mortal's picture

Come on guys, the Fed will be fucking delighted that their tightening is being exported.

Rather than EM turmoil being a reason to pause its reason to press ahead.

The FOMC will be punching the air at EM distress.

Wed, 01/29/2014 - 18:36 | 4381993 alangreedspank
alangreedspank's picture

If the new money ain't going in the EM anymore, it will need to go somewhere else. Bullish for US CPI, which is exactly what the Fed wants anyways. Now consider how much credit was cranked out with a relatively stable monetary base pre-2008, and consider how much of it can potentially be with a monetary base that has tripled...


Wed, 01/29/2014 - 16:16 | 4381279 Headbanger
Headbanger's picture

Why don't you just go ovrer there any enjoy the doom you wish for ahead of us then!?

Wed, 01/29/2014 - 16:09 | 4381229 Winston Churchill
Winston Churchill's picture

Et tu Sam.

Wed, 01/29/2014 - 16:08 | 4381232 SAT 800
SAT 800's picture

Yeah but it's all intertwined. our Banks are up to their asses in their banks; including plenty of screwball derivatives; and Im sure some big bond positions, too; so if contagion sets in; we could get whacked. South Africa already re-acted to Turkey by raising their discoiunt rate. So now we're waiting to see if anyone else, or how many elses, get drawn into this pissing contest.

Wed, 01/29/2014 - 16:14 | 4381254 Renfield
Renfield's picture

<<Yeah but it's all intertwined. our Banks are up to their asses in their banks>>

Globalism, baby! The big banks wanted it, got it, and now they love it.

Each of us posting here has a country, but the banksters don't.

Wed, 01/29/2014 - 16:27 | 4381338 BeepBeepImAJeep
BeepBeepImAJeep's picture

The country has you, you mean.

Wed, 01/29/2014 - 16:11 | 4381240 falak pema
falak pema's picture

the empire has its own rules...especially for those who bent knee to it as surrogates.

It just goes to show you have to be Spartacus to keep your own sense of values in the face of hegemon. 

Wed, 01/29/2014 - 16:12 | 4381243 Sufiy
Wed, 01/29/2014 - 16:14 | 4381266 unplugged
unplugged's picture

There's nothing the all powerful Fed cannot accomplish -

PROBLEM:  taper AND keep bond yields from rising

SOLUTION:  create an EM conflagration to drive everyone into the saftey of US Treasuries

mission accomplished !! 

Well done Ben, well done!  Congrats !

Wed, 01/29/2014 - 16:28 | 4381351 Rainman
Rainman's picture

JGB 10y @ .63%


Wed, 01/29/2014 - 16:36 | 4381407 darteaus
darteaus's picture

And the follow up act is...

Wed, 01/29/2014 - 16:59 | 4381524 Rainman
Rainman's picture

UST 10y @ .63% ?

Wed, 01/29/2014 - 16:16 | 4381283 ebworthen
ebworthen's picture

Santelli pointing out that the 10 year T rate and equities following each other.

In other words, crushing equities will keep debt payments lower.

Perhaps they were told it was time to rake the sheeple's chips off the roulette table.

Just in time for "MyRa" and ending extended unemployment.

Wed, 01/29/2014 - 16:23 | 4381307 unplugged
unplugged's picture

But how much US Treasuries can your typical McWorker buy?  They have to spend every dime they make AND then some.

Wed, 01/29/2014 - 16:28 | 4381354 ebworthen
ebworthen's picture

Every little bit helps, and if people see their IRA in equities getting crushed they'll convert it to a MyRa (guarantee you there will be a provision for that and promises of a tax break).

And, if foreign markets are hammered, they may well buy into U.S. debt as well.

It would be a way to keep debt payments lower and keep the Ponzi alive.

The insiders on Wall Street will be out the door and leave "folks" holding the bag.

They win coming and going, we lose.

Wed, 01/29/2014 - 16:20 | 4381300 russwinter
russwinter's picture

The Parasite Guild is now in charge. 


Wed, 01/29/2014 - 16:46 | 4381458 Son of Captain Nemo
Son of Captain Nemo's picture

That one is a keeper.


Wed, 01/29/2014 - 16:27 | 4381348 Yen Cross
Yen Cross's picture

  If the Aud housing numbers and China news come in decent later, these stupid hedgefund fucks that are short aud are going to get their heads handed to them on pikes.

Wed, 01/29/2014 - 16:33 | 4381394 ejmoosa
ejmoosa's picture

Making the rest of the world look as if it is going to hell is probably the last thing Obama has in the arsenal to make his economy look decent.

Wed, 01/29/2014 - 16:50 | 4381470 gwar5
gwar5's picture

It's war by other means.


The BRICs are the ones moving to an alternative WRC to the USD. Ergo EM are the "Enemy."  Everything else is collateral damage. We are plankton. 


Wed, 01/29/2014 - 16:56 | 4381505 Iam Yue2
Iam Yue2's picture


"We still worry about the high level of foreign bond holdings in Malaysia, the political situation in Thailand and low real interest rates in both Thailand and the Philippines."

Roll the dice.

Wed, 01/29/2014 - 17:12 | 4381602 SheepDog-One
SheepDog-One's picture

And haven't most of these 'emerging markets' been diversifying away from the FRN?

Wed, 01/29/2014 - 17:53 | 4381827 Xandrino
Xandrino's picture

Even gold can't be suppressed with this shit...bring it on bitchezzz!


Wed, 01/29/2014 - 19:18 | 4382196 Herdee
Herdee's picture

Looks to me as though the U.S. Government is taking the play book from their friends in Japan.Support all your debt from within and brainwash the general public and maybe we can last a bit longer.Those in Government are probably laughing their asses off saying "we'll suck in every stupid cocksucker out there just like they did in Japanese did."

Wed, 01/29/2014 - 20:45 | 4382573 U4 eee aaa
U4 eee aaa's picture

Is this Yellen's doing? Maybe she has some worth after all.

Thu, 01/30/2014 - 07:01 | 4383451 Rodders75
Rodders75's picture

Contrarian indicator?


China banking worries 'way overblown': Wilbur Ross http://www.cnbc.com/id/101366393 


Tom Demark says buy oppty is appearing.


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