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WSJ: "Markets Are In Thrall To Central Banks Rather Than Caring About The Health Of The Economy"

Tyler Durden's picture




 

It was about 5 years ago, roughly the same time we launched our crusade against HFT, that we also first made the accusation that as a result of QE and the Fed's central planning, the forward-looking, discounting mechanism formerly known as the "market" no longer exists, and instead has been replaced with a policy vehicle designed to create a "wealth effect" if only for those already wealthy. In other words, while HFT may have rigged the market, it was the Fed that has openly broken it.

Today, none other than the WSJ is the latest to confirm this. To wit:

We’ve had more proof that financial markets are in thrall to central banks rather than caring about the health of the economy. Data out of Asia and Europe were disappointing, with China suffering a drop in both exports and imports and with industrial production in Italy softening as deflation worries persisted in France. Yet markets are stronger everywhere today. In Asia, that was partly explained by the largely expected but still significant news that China will allow Hong Kong shares to trade in Shanghai, marking a further easing in capital controls. But the real driver has been expectations of continued monetary accommodation from central banks. First, it was the minutes from the Federal Open Market Committee yesterday, which gave the impression that the Fed is eager to convey a message that it wants to keep providing long-term stimulus. Then it was the poor data in Europe, which, rather than unnerving investors, simply raised expectations that the European Central Bank will take aggressive steps to ward off deflation.

And to think 5 years ago this would be considered daylight, fringe tinfoilhat bloggery. Our advice to the WSJ, next time use quotation marks as follows: "markets"

 

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Thu, 04/10/2014 - 08:57 | 4642711 Cattender
Cattender's picture

no shit?

Thu, 04/10/2014 - 09:05 | 4642741 GetZeeGold
GetZeeGold's picture

Rigged?

Thu, 04/10/2014 - 09:19 | 4642782 clooney_art
clooney_art's picture

Rigged and illusory.

Thu, 04/10/2014 - 09:19 | 4642784 Haus-Targaryen
Haus-Targaryen's picture

ITT: The WSJ confirms that good news is now bad news, and bad news is good news. 

The sad thing is, despite all the evidence that the "markets" are rigged, and the entire economy is running on nothing but hope and change.  When it all collapses 99% of the population will be MAF because "no one saw this coming." 

Thu, 04/10/2014 - 09:27 | 4642805 Serfs Up
Serfs Up's picture

Correction:  Need to use more quote marks to accurately convey just how corrupt, rigged and irrelevant the """"market"""" has become.

Thu, 04/10/2014 - 09:41 | 4642831 ArkansasAngie
ArkansasAngie's picture

Do tell

They are picking the winners and losers.  

I want a different set of pickers and a different set of winners and losers

Let the market decide ... not a bunch of currupt arse holes

screw'em

Thu, 04/10/2014 - 10:40 | 4643073 Babaloo
Babaloo's picture

The next time the WSJ is right will be the first time.  Anybody who quotes them as an authority on anything is delusional. 

Thu, 04/10/2014 - 09:00 | 4642723 buzzsaw99
buzzsaw99's picture

they have that backwards

Thu, 04/10/2014 - 09:02 | 4642729 Shizzmoney
Shizzmoney's picture

Also in the WSJ: "Bears shit in the woods".

Thu, 04/10/2014 - 09:17 | 4642776 crazzziecanuck
crazzziecanuck's picture

Polar bears don't.  :)

Thu, 04/10/2014 - 09:03 | 4642734 SilverIsMoney
SilverIsMoney's picture

Theres so much ZH smoke being blown by the MSM right now you just know weve gotta be close... Thats what I hope anyway...

Thu, 04/10/2014 - 10:16 | 4642972 Yes_Questions
Yes_Questions's picture

 

 

then you win..

Thu, 04/10/2014 - 09:03 | 4642735 PlusTic
PlusTic's picture

how dare you speak of such conspiracies!  lol!

Thu, 04/10/2014 - 09:04 | 4642737 bubblemania
bubblemania's picture

Bullish!

Thu, 04/10/2014 - 09:04 | 4642740 Ribeye
Ribeye's picture

Conspiracy nuts

Thu, 04/10/2014 - 09:10 | 4642752 Bill of Rights
Bill of Rights's picture

Conspiracy is failure to think.

Thu, 04/10/2014 - 09:06 | 4642743 101 years and c...
101 years and counting's picture

by definition, it is, and always has been, a PONZI.

Thu, 04/10/2014 - 10:56 | 4643166 Shad_ow
Shad_ow's picture

But now there are NO rules if you are connected, you cannot lose.  If not, too bad.

Thu, 04/10/2014 - 09:08 | 4642747 yogibear
yogibear's picture

Nothing else matters to the Fed except keeping asset prices moving higher. Even if it means killing the 80% of the population financially.

 

Thu, 04/10/2014 - 09:42 | 4642836 ArkansasAngie
ArkansasAngie's picture

Greater good?

Horse manure.

 

Thu, 04/10/2014 - 10:57 | 4643172 Shad_ow
Shad_ow's picture

Really?  Those who are "greater" are good.  Everyone else not so much.

Thu, 04/10/2014 - 09:15 | 4642748 One And Only
One And Only's picture

High stock values are great for the economy.

Just look at the IBVC. Up 310% in the last year.

Thu, 04/10/2014 - 09:09 | 4642751 MFLTucson
MFLTucson's picture

It is the best way for the Federal Reserve to enrich the  the Jewsih bankers, the only group they are interested in.  

Thu, 04/10/2014 - 09:12 | 4642762 Flakmeister
Flakmeister's picture

I am more worried about the crooked White Anglo-Saxon sociopaths that went to Wharton and the like...

Take your jew baiting and shove it up your ass... 

Thu, 04/10/2014 - 09:20 | 4642779 Dr. Engali
Dr. Engali's picture

I blame the Malagasy people for the world's woes. Do a little research and you will find they secretly control everything.

Thu, 04/10/2014 - 09:19 | 4642783 Proofreder
Proofreder's picture

But, I thought it was all about the juicy bankers - you know -

those so ripe they pop when you squeeze 'em.

Squeeze a juicy banker today and then stand back!

Thu, 04/10/2014 - 09:44 | 4642842 CharlieMike
CharlieMike's picture

Jew baiting?  The fact that Jews control a disproportionate number (in terms of % of the population) of high level positions in Government, Finance and Major Corporations cannot be disputed.

The only argument is do they represent the best interests of average Americans or not.

Thu, 04/10/2014 - 10:04 | 4642915 Flakmeister
Flakmeister's picture

Take your faux concern trolling elsewhere buddy...

And since when was acting in the best interests of the American people a monlithic cultural requirement?

BTW, ask Paul Ryan about the "culture of work" and get back to us...

Thu, 04/10/2014 - 10:33 | 4643044 CharlieMike
CharlieMike's picture

Since when was acting in the best interests of Jew bankers a monlithic cultural requirement?

 

Thu, 04/10/2014 - 10:36 | 4643058 Flakmeister
Flakmeister's picture

Yawn....

Go troll someone else...

Thu, 04/10/2014 - 09:10 | 4642754 buzzsaw99
buzzsaw99's picture

<--- there will be MOAR

<--- the fed will make billionaires cry

Thu, 04/10/2014 - 09:50 | 4642857 CHX
CHX's picture

o'curse, there'll be moar. Fed owned by the TBTFs, and the Ponzi must going on, till the fat lady sings. And by then, the billionairs will also have enough gold, so in the new system most of the now-1%ers will likely still be the 1-2%ers, but some current 99%er-PM-shrimps may well rise into that category as well.  

Thu, 04/10/2014 - 09:11 | 4642756 Flakmeister
Flakmeister's picture

Yet another symptom of the end of growth....

Thu, 04/10/2014 - 09:26 | 4642803 pods
pods's picture

The thing that chaps my motherfuking ass is that if we didn't have a fractional reserve currency and need exponential growth I could be on the beach fishing somewhere enjoying the last 100 years of productivity gains.

pods

Thu, 04/10/2014 - 09:43 | 4642838 ArkansasAngie
ArkansasAngie's picture

They are stealing time

aka servitude.

Thu, 04/10/2014 - 10:04 | 4642892 Flakmeister
Flakmeister's picture

The Fed never changed the tax code that allowed those in the boardroom to steal most of those gains...

Those gains accrued to labor before the 1980's....

You can blame the Fed to the extent that Greenspan was Randian acolyte who was ok with the "greed is good" meme...

Thu, 04/10/2014 - 10:06 | 4642929 pods
pods's picture

Bigger than that Flak.  Compound functions.  Look at any debt curve for the last 100 years.  Debt has been going up at an exponential rate.  Exponential growth is needed to service the interest on that debt.

That is why all these pie in the sky sustainability ideas are just that. Because our money system requires exponential growth.

The last 30 years look worse because the amount of debt is increasing exponentially as well as the interest.  Interest is where the bankers make their killing.  

It is the logical outcome for our money system.

Those who conjure money and lend it out with interest will make more as more debt is required.

Sure there are the spreads between rich and poor. Aways happens when interest rates are held abnormally low to increase debt production. Those at the top get the largesse.  Those close to the money get the bulk of that largesse.

pods

Thu, 04/10/2014 - 10:33 | 4643043 Flakmeister
Flakmeister's picture

It is a complicated phenomena and if one had to choose a theme it would be the wholesale adoption of the meme that unfettered greed is good, throw in reinforcing feedbacks from the tax code and eh voila...

The financialization of the leading world economy at its apogee is not a new thing, the Spanish, Dutch and British all did it in turn. It is not a surprise to students of history that it has occured in the US, and having gold backed currency  made no difference...

Thu, 04/10/2014 - 10:30 | 4643026 overmedicatedun...
overmedicatedundersexed's picture

flaky flak, quick to defend the chosen people, quick to defend man made global warming, lover of the FED, what percent of fed chairs have been non chosen people the last 40 years or 1980 if you must? at times one might think he is really a cnbc host for hot money. is that you Jimmy? anti rand and when facts get in the way the king of ignore the elephant in the room...how many non jews run finance again? and in true flak style the old deflect the subject with the odd question, what percent of earth's atmosphere is water vapor and what percent is C02???

Thu, 04/10/2014 - 10:35 | 4643054 Flakmeister
Flakmeister's picture

Go fuck yourself....

And how much water vapor would there be if there was no C02, you deluded ignorant shit....

Thu, 04/10/2014 - 14:32 | 4644257 daveO
daveO's picture

Plenty. Methane's the biggest greenhouse gas, thank god and cows.

Thu, 04/10/2014 - 16:11 | 4644685 Flakmeister
Flakmeister's picture

Dave, you aren't allowed to make shit up...

So while CH4 is a very potent GHG, it is not the most important non-condensing one:

http://www.esrl.noaa.gov/gmd/aggi/aggi.html

Thu, 04/10/2014 - 14:34 | 4644249 daveO
daveO's picture

Greenspan wrote in favor of the Gold Standard in 1966. Then, after crashing the market 20 years later, he kept rates too low(almost entirely) from then on. We have now had all but a few years of sub par interest rates thanks to him, Bernanke and the newest one.

For anybody new reading this, when Inflation is 2% that means the FED has stolen all productivity gains PLUS 2%. Why do people keep working for FRN's? They're selling themselves into slavery to New York City and it's Puppet on the Potomac. 

Thu, 04/10/2014 - 16:13 | 4644697 Flakmeister
Flakmeister's picture

Greenspan and his belief in self regulating markets and similar drivel is also to blame...

Funny, how shit starting going south when a Randian was put in charge of the Fed....

Thu, 04/10/2014 - 09:12 | 4642763 Tsar Pointless
Tsar Pointless's picture

In other news, there was more than one gunman during the Kennedy assassination. Nixon WAS a crook. The attacks of 9/11 were an inside job. Bill Clinton really DID have sex with that woman, Monica Lewinsky. And, I shot J.R.

Thu, 04/10/2014 - 09:13 | 4642765 NDXTrader
NDXTrader's picture

Maybe it's because I read this site every day, but I thought everyone already knew this

Thu, 04/10/2014 - 09:13 | 4642766 bnbdnb
bnbdnb's picture

Tyler, your name is Jack. Figure it out.

Thu, 04/10/2014 - 09:14 | 4642767 Waterfallsparkles
Waterfallsparkles's picture

The shame of it is that the more the Fed Prints and indebts the Country the more Wall Street rallys their decision.

The problem for most Americans is that it is in a sence a redistribution of Americas wealth to Wall Street and the Banks.  After all it is the average Person that will be responsible for paying that Debt back.

Plus, it is the average American which is already seeing this redistribution of the Nations Wealth in the increase in their Food, Gas, Heating Oil and all of the other items they need to survive go thru the roof.

Thu, 04/10/2014 - 14:37 | 4644273 daveO
daveO's picture

The average citizen will only have to pay back this debt to the extent they are exposed to FRN's. If you keep your savings out of FRN's, it's possible to be less exposed than the average Egyptian was a few years back. The FED is stealing from dollar holders worldwide. That's how they've kept bankrolling the charade.

Thu, 04/10/2014 - 09:22 | 4642769 Dr. Engali
Dr. Engali's picture

As I was getting ready this morning listening to CNBS, for the first time in months, I couldn't believe my ears when I heard some idiot fund manager stating that the market performance was all based on fundamentals and had nothing to do with QE. His argument was that Europe doesn't have QE and look how well their markets have performed. I never heard anything so  idiotic when it comes to explaining the markets.

Thu, 04/10/2014 - 09:27 | 4642806 AynRandFan
AynRandFan's picture

QE is just an excuse we rational people need to explain the carnival atmosphere of liberalism unleashed. According to the now prevailing philosophy, we will never run out of money - enter the fed and its governing arm, the all powerful executive branch of the federal government.

Thu, 04/10/2014 - 09:37 | 4642823 bardot63
bardot63's picture

Do you think Dennis Gartman was watching?

Thu, 04/10/2014 - 14:38 | 4644279 daveO
daveO's picture

Watching and wanking?

Thu, 04/10/2014 - 09:16 | 4642774 Protokletos
Protokletos's picture

"witchcraft"

Thu, 04/10/2014 - 09:22 | 4642793 AynRandFan
AynRandFan's picture

The last 7 years has been one big festival celebrating the triumph of hope over experience. And, of course, that requires that we finally and for all time elevate the federal government to the paternalistic apex of American history while eliminating all vestiges of behavior among the population once associated with liberty, like realism, masculinity, and truth. Even the scientific community has largely become messianic cheerleaders for human guilt in the global warming religion. From one of the backwaters of America, I say bullshit! Well, Messers Clinton and Obama are on their way here to villify white males again and for all time in the ironic Civil Rights conference. We can bet that civil rights won't include private ownership of guns.

Thu, 04/10/2014 - 09:54 | 4642874 Ban KKiller
Ban KKiller's picture

Replace the word "government" with big business and I am with you.

Monsanto, big pharma, big oil, etc., do not want an armed populace!

BTW, we are all niggers now. Yeah, I've said it before.

Thu, 04/10/2014 - 09:29 | 4642809 sleigher
sleigher's picture

"It was about 5 years ago, roughly the same time we launched our crusade against HFT"

 

Is that also the time you started deleting posts that you didn't like?

Thu, 04/10/2014 - 09:31 | 4642812 Proofreder
Proofreder's picture

Voodoo

Economics

 

Wait, isn't PR broke ?  And Jamaica is going to pot to balance their budget.  

A little OT, but are you ready for the Bad Moon due to rise on the East Coast near dawn on Tax Day ? - surely a bad omen.  Lyrics by Credence Clearwater, big John Fogherty seem quite prescient.

I see the bad moon arising.
I see trouble on the way.
I see earthquakes and lightnin'.
I see bad times today.

Don't go around tonight,
Well, it's bound to take your life,
There's a bad moon on the rise.

I hear hurricanes ablowing.
I know the end is coming soon.
I fear rivers over flowing.
I hear the voice of rage and ruin.

Hope you got your things together.
Hope you are quite prepared to die.
Looks like we're in for nasty weather.
One eye is taken for an eye.

Be Prepared

Thu, 04/10/2014 - 09:39 | 4642829 CHX
CHX's picture

1. Get out of these fraudulent markets. 2. Get some physical gold and silber (outside the financial system at bargain prices), and have some cash at hand (hard copy). 3. Get some pop-corn and watch the show as it all unravels - it'll be one to remember, one for the history books IMHO. Good luck to all. 

Thu, 04/10/2014 - 09:51 | 4642859 Ban KKiller
Ban KKiller's picture

Have shitgum to defend my silber. 

Thu, 04/10/2014 - 09:43 | 4642839 Rising Sun
Rising Sun's picture

HFT is just "faster trades" - the benefit of being faster is that they can front run orders.

 

Solution?  Legacy firms like GS and JPM have to purchase and build the same technology to do the same instead of whining on 60 minutes.

 

Don't see many exchanges blocking HFT firms from co-locating servers - seems they like the money too much.

 

But the Fed and their fucked up ways and Barry just watching - fuck the lot of you and burn in hell!!!!!!!!!!!!!!!!

 

 

 

Thu, 04/10/2014 - 09:47 | 4642850 Bryan
Thu, 04/10/2014 - 09:49 | 4642853 Ban KKiller
Ban KKiller's picture

Look, the word everyone is afraid to use is Fascism. Why? Because we killed fascists in two world wars...we should finish them all off. Know any? Why, yes, you do. I advocate justice in a country where laws don't matter to the...fascists!

Thu, 04/10/2014 - 09:49 | 4642854 kellycriterion
kellycriterion's picture

Forget paying back. Forget fundamentals. Forget money.

If you want to discuss medium of exchange, divide it into two categories. Let's call the first WORKTRADE, that which is used by the public to exchange labor for goods and services. Let's call the second CYBERWAMPUM, that which is used by the OPM mafias as a tool for confiscation and control.

Thu, 04/10/2014 - 09:49 | 4642856 BullyBearish
BullyBearish's picture

Render to Caesar the things that are Caesar's...

Thu, 04/10/2014 - 10:05 | 4642920 Save_America1st
Save_America1st's picture

Evil and treasonous criminal banksters and politicians are in thrall to the central banks rather than caring about the health of the economy.

 

there...fixed it for ya. 

Thu, 04/10/2014 - 10:07 | 4642935 q99x2
q99x2's picture

Up my FAFSA

Thu, 04/10/2014 - 10:18 | 4642977 LongSilverJohn
LongSilverJohn's picture

I cancelled my subscription to the WSJ back in 2009, and read ZH as my most reliable source of news, analysis and commentary. Tyler deserves a Pulitzer....

Thu, 04/10/2014 - 12:35 | 4643784 Ariadne
Ariadne's picture

Under the current regime to get a Pulitzer you have to be a lying whore. Paul Krugman was nominated. Are we clear?

Thu, 04/10/2014 - 13:16 | 4643982 pashley1411
pashley1411's picture

Kind of wonder what caused the market shills at WSJ to start to come clean.   The stock market is the bread-and-butter of their coverage, admitting that stock values are stamped at the federal level has got to hurt.

I mean, admitting the obvious has not exactly been the oeurve of the WSJ, let alone the rest of the MSN, for some time.

Thu, 04/10/2014 - 14:44 | 4644304 daveO
daveO's picture

First it was 60 minutes, then this. They are setting everyone up for the 'planned' crash. They'll say, 'Don't look at us, we warned you'. The typical behavior when a new FED Chair goes in is to crash the markets so they'll have a new excuse for sup par rates/ QE. You've been warned. Watch for commodities to tank first like 2008.

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