FOMC Ignores EM Crisis, Tapers Another $10 Billion - December Statement Redline

Tyler Durden's picture

Consensus that the Fed would extend its $10bn taper from December with a further $10 bn taper today (reducing the monthly flow to a 'mere' $65 billion per month - $30bn MBS, $35bn TSY) was spot on. We suspect the view, despite the clear interconnectedness of markets (and flows), of the FOMC is that "it's not our problem, mate" when it comes to EM turmoil.


Of course, "communication" was heavy with forward guidance on lower for longer stressed. We'll see if the market buys the dichotomy of hawkish real tapering and dovish promises...remember "tapering is not tightening."

Pre-FOMC: S&P Futs 1775, Gold $1267, 10Y 2.71%, 2Y 35.5bps, USDJPY 102, EM FX 85.67, WTI $97.35, IG 72bps, HY $106.35


Perhaps this chart from Saxo Capital Markets ( @saxomarkets ) sums up the world best for now...


Full redline below...

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Xibalba's picture

"less than expected"

AllThatGlitters's picture

LOL - Look at Gold and Silver whipsaw up and down.  

Live Gold Chart Reaction:

Live Silver Chart Reaction:

As if any of this Fed Babble means anything. They don't stick to whatever they tell us they are going to do anyway.



Panem et Circus's picture

We are still a long way from lift-off. But I admire your enthusiasm!

hedgeless_horseman's picture



God bless Kevin Henry and his keyboard.


Headbanger's picture

Now where are all the "Fed will never taper" douche bags who were here a month agao!!/


nope-1004's picture

If you believe the headline (and this gov't), do so at your own risk pal.


AllThatGlitters's picture

That's right nope.  The Fed Statement is far from proof that Fed is tapering, LOL.  Talk about naive!

new game's picture

it appears, haha appears that hey are acting prudent(yeh right), as a deversion from backstopping spending.

if we only knew. after 08 and the money laundered to buds around the globe and ge, i can asure you the 65 b is the tip of the iceberg.

until they are gone, it will be the shadow fed in my eyes...

but, i dare to say, they will be unseated when the dollar is no long king of the ponzi.

post syria crisses, we lost major credibilty worldwide. the world bank dude advising china and coming out, and the snow ball is rolling down the slope in wet world emerging fx turmoil. ok bricks have you had enuf? like our nsa spying?

fuking joke merica with the joker in charge. where is batman and boy wonder(snowden i supose).

i am preparing formy  dollar reserves to be cut in half if not vested. or spent on durable and hard assets.  trick is to pick the correct ones.


Jack Napier's picture

The Fed may have tapered the rate of increase in QE as compared to last month but they are still increasing the amount of total QE every month. I'll consider it a taper when they decrase the money supply and start trying to unwind the black hole. That will never happen.

And the way markets are responding to a slight reduction in Fed heroine is evidence that the addict cannot survive without it. Don't get it twisted. QE isn't going anywhere. They are simply gauging the patient's level of addiction to determine future dosings.

NotApplicable's picture

Until the Treasury market has to rely upon voluntary market support (aka real consumer demand), any "tapers" are merely fictional facades.

So, while the Fed pretends to taper, they merely make cash flow in a different direction.

And people like you apparently fall for it.

Here's the deal...

money is fungible

atomp's picture

IIRC, the meme from a couple months ago was: taper-crash-untaper, but yes, the never taper guys seem to be absent.

Herd Redirection Committee's picture

And we have seen the S&P down 3.5%+.  And EM turmoil.  The loonie lost 10% in the last month. I'm more in the "they'll never raise rates (significantly)" camp.

Cursive's picture


I've always thought they'd taper (they eventually have to), but not convinced of anything that they SAY.  I want to see what they DO.

Frozen IcQb's picture


That would be me...I accept full responsibility and spare my fellow ZH'ers.


Uber Vandal's picture

Uber Vandal reporting for whipping boy duty, sir!

arkel's picture

I thought they would never taper, so I'm wrong.

Plus, surprised that gold/silver aren't sliding. Also surprised that bond yields aren't moving higher. 

new game's picture

fear trade, plus they have 19 dealers given marching orders(the club) and have their backs covered.

taking the 2.5 handle way sooner than previously thought. 16 basis pts from...

ejmoosa's picture

So, if we change it to a time perspective, then the Fed is just two weeks behind on it's normal volume of actiities....And for the last 12 months, we are at Taper= (85*12)-30. 

97% of the previous rate of QE, or 100%.

Petty much the same in my eyes.

SDShack's picture

Just wait until the end of February, when the Repukes cave on the debt ceiling, and the budget deficit starts rising again due to expiration of the sequester. QE was just a way to monetize the debt. The deficit fell because of the debt ceiling and sequester. That is coming to an end, and the deficit will rise as congress goes on another spending spree. Hell, you just saw it with the Farm Bill that just passed. Every bill going forward is going to be larded with pork. Under Bush, $400B deficits were the end of the world, but $700B deficits now are trumpeted by 0zer0 in his SOTU speech. Meanwhile housing is slowing, jobs are non-existent, benefits continue and are trying to be expanded, add amnesty and 0zer0care = deficit rises and debt ceiling is broken, so the Treasury has to find more treasury buyers, and the Fed is buyer of last resort. This taper is only temporary at best. By the end of 2014, it will be apparent the recovery that never was will give way to the never ending great recession. Enter the Fed once again. Rinse and repeat.

Hedgetard55's picture

Questiion: how does ZH get this info and it's analysis out so quickly, time stamp 14:01, 1 minute from release? At least with Hilsenwrath I know he gets it 30 minutes early, but Tyler? What up wid dat?

RebelDevil's picture

Keep in mind that the "Tylers" are more likely a team of 40 (or more) than 4. See Wikipedia and past bios on the Tylers.

They're dedicated to be the best in financial and economic journalism, and I like that. :)

Hedgetard55's picture

Yea, a C-note to Jon and the minutes find their way over to Tyler also. Guess that's cool, bringing a gun to a gunfight, so to speak.

silvermail's picture

"how does ZH get this info and it's analysis out so quickly, time stamp 14:01, 1 minute from release?"

They are advance prepared text of this last of Bernanke's speech.

A L I E N's picture

Taper is tightening in this Keynsian wonderland

StacksOnStacks's picture

Hey guys!  Instead of smoking 10 packs a day I'm going to smoke 9.5.  It'll be like I'm not smoking at all! Everything is well.

AllThatGlitters's picture

Isn't this what everybody said it would be?


sixsigma cygnusatratus's picture

Cue Cramer melt down...

ebworthen's picture

He's saving the full-bore histrionics for the next big crash so his acolytes can see him get angry.

"What does it matter!?!?  Four years of gains are dead!!!"

Levadiakos's picture

Hold on! I need to know what he's buying.

ebworthen's picture

Set the prime rate at 5%!

Zero QE!

C'mon you CHICKENS!


maskone909's picture

bond buying? i thought it was only MBS

CH1's picture

It was 40/45.

Not sure what it is now.

Tsunami Wave's picture

I didn't expect another taper so soon.  But then again, it's maybe good cop FED time before bad one comes in soon.

buyingsterling's picture

They need a big taper before the big correction, or they won't be able to justify the untaper.

Dr. Engali's picture

Don't worry we can make up for it in our MyRas.


Way to go Ben you throw 23 trillion at the problem just to fuck it up on your way out. You're an even bigger buffoon than I thought.

Kaiser Sousa's picture

they aint tapering a mother fucking cent...

the counterfeiting will continue along with the free confetti being spoon Fed to their banker brethren...



oddjob's picture

Selling the same bonds twice had a rather destructive conclusion last time.

DadzMad's picture

Right.  Saying they're going to taper and actually tapering are two different things.

On another note.  I check CNBShit occasionally to catch up on commodities (corn and beans).  I love how they openly hate the metals.  The headline reads "Gold inches higher" when it's up fifteen bucks, but the next time state "Gold gets slammed!" when it drops 4.50.

wiseindian's picture

And speaking of stacking, what is the ZHers consensus on approximate oz of stacks that we should own and subequently foolishly to lose in boating accidents? Looking for rule of thumb to see where I stand in the army of stackers.

Kaiser Sousa's picture

take note of the global debt based currency paradigm unraveling on a daily basis before your very eyes...

then open up your safe and stare at your real money...

if you can close it with the belief that you have enough to get you and yours thru the great reset  - then you have enough...

if you cant - you dont.....

AngelEyes00's picture

"if you can close it with the belief that you have enough to get you and yours thru the great reset"

You haven't been listening to Lindsey Williams have you?  Currency exchanges operate to adjust currency valuation.  Currency resets are not needed.


Frozen IcQb's picture

5% in palpable physical and another 25% in pm shares as a percent of investable assets.