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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Headbanger's picture

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

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...

Arius's picture

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

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

stonecoldbrokeinthemiddleofthewinter's picture

The mythical creature in the picture is  circumcised.

Hedgetard55's picture

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

SheepDog-One's picture

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

gatorengineer's picture

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

WillyGroper's picture

Given their gold holdings, you could be right.

War in   3...2...1

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*

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.

Bearwagon's picture

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

Headbanger's picture

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

Non Passaran's picture

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

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.



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.

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...


Headbanger's picture

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

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.

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.

BeepBeepImAJeep's picture

The country has you, you mean.

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. 

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 !

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.

unplugged's picture

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

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.

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.

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.

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. 


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.

SheepDog-One's picture

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

Xandrino's picture

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


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."

U4 eee aaa's picture

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

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.