Will History Record The Ending Of QE As An Archduke Moment?

Tyler Durden's picture

Authored by Mark St.Cyr,

One can’t help but look at the situations transpiring around the globe and hope: things are different this time. The problem is being different puts it right back in line with that other caveat: history doesn’t repeat itself, but it does rhyme. And so lies the most troubling aspect facing not only the U.S. economy, but quite possibly the world as whole. For if things rhyme anything inline with past events in history: We’re all in a dung heap of QE based minutia, with Geo-political ramifications the “intellectual” crowd never contemplated as possible – let alone probable.

It was just a mere 4 years ago this month in which then Fed. Chair Ben Bernanke announced to the world via his now infamous Jackson Hole speech that QE would basically be adulterating the financial markets indefinitely. i.e., QE1 became QE2 signaling QE4eva. And since that time the Federal Reserve has done just. And as always that decision was heralded by the financial media as “genius.”

And why wouldn’t they since this would now afford them a seemingly never-ending revolving set of happy faced hedge fund managers that could tell the world how they were just making a killing for their investors. Everything once again seemed just ducky. “Don’t fight the Fed.” again became the clarion call. However what most of these “wizards of smart” couldn’t read past their teleprompter is that the world may turn and fight them – literally.

The distortions in financial markets throughout the world have been breathtaking to anyone who’ll look using a thimble full of common sense. As the emerging markets became overheated and searched for ways to deal with hot money inflows wreaking havoc within their own markets. The Fed. and crew kept the pedal down, year, after year seemingly not giving any notion of care that others may retaliate in ways never contemplated by the intellectual crowd. i.e., War.

Just look at recent comments made by now Fed. Chair Janet Yellen in her most recent appearance before Congress as reported by ZeroHedge™: Yellen Warns Of Small Cap Bubble.  I read that headline and thought: Are you F’n kidding me?! I then took to the media channels to see if anyone called out that statement as proof the Fed. has no idea of what they are doing and counting on the media as to not point it out. It seemed I was correct for the silence was in fact – deafening.

If one thinks back to nearly every single testimony given as proof that QE was working you’ll recall Mr. Bernanke state, (I’m paraphrasing) “Just look at the Russell 2K.” Now suddenly a mere 5 months after his departure when the media et al gave his steady hand a sycophantic waving of goodbye, no one reports as to elaborate the glaringly obvious admittance by the new Fed. Chair? No one?

Revelations such as this along with the sheer unwillingness (or worse – incomprehension) of others to question such out right contradictory assessments must also be leaving others as slack-jawed as much as myself. But (and it’s a very big but) there are others that see such ineptitude, rudderless, contradiction in monetary, as well as political: as opportunity.

Nothing rallies a nation faster than the threat of an enemy. And nothing serves a political class born of dictators than using any and every tool at their disposal as to rally the glaring eyes of political unrest and affix it to another as to release their ire. And what better straw-man has the world offered the tyrannical powers of the world at large than the interventionist monetary policies of the Federal Reserve via their QE program.

Attach to this the mighty response as a “show of strength” in unison across the globe that sanctions along with freezing accounts is the openly decided upon tool more powerful than armies, or weapons.

To the multitude of uninformed as well of as misinformed people under these regimes. This is propaganda made to order in ways that even Goebbels would blush.

One can’t help but find the timing hauntingly coincidental that Vladimir Putin decided the window of opportunity to make his move on former parts of the Soviet Union was in near unison with the Fed. Revelations that in fact QE was being wound down. i.e., In February when the announcement of the 2nd $10 Billion dollar reduction made manifest that in fact the QE wind down was on schedule. (A schedule many across the financial media said wouldn’t happen.) Now economies such as Russia and others would find themselves once again at the center of any political unrest, while simultaneously being economically hamstrung screamed opportunity to use it to their advantage with Machiavelli inspired actions.

Tag onto this that other land mass with far more people to cast political upheaval than Putin has to contend with: China.

Suddenly the economy touted as “the” economy that will save us all is not only slowing, it’s contracting at a pace far more quickened as a direct result of QE being pulled.

One has to search far and deep to find just how bad and the frightening instability within their financial system that could take down world markets in a free fall under the right circumstances.

The issue here is these circumstances are not a million to one, they could be as high as 1 in 10. The U.S. “intelligentsia” seems absolutely oblivious to these facts or even the notion that such could transpire. Yet, suddenly that trading partner that every one of our so-called “smart crowd” regurgitates “they need us as more than we need them” is publicly taking the side, drawing up trade deals, and standing for photo ops with: Russia. Seems they have something in common suddenly don’t you think?

I marveled the other day when I found myself in a heated argument with others in respects to the events of today and how they’re playing out. Every time a point was brought about on how or why the circumstances along with the possibility for WWIII breaking out in earnest was met with sheer contempt, as if such things were ancient history.

Even when it was pointed out the display this past week by Soviet forces in assorted missile launches coupled with the now seemingly joined at the hip China sending in armed protection provoking retaliation or provocation in both U.S. friendly Japan and Vietnam territories: it was brushed aside.

Used as defense was the ludicrous notion that things like this aren’t as probable any more since economically we’re all dependent on each other as never before. That’s why the monetary policies since WWII has kept that type of balance in check. Personally I was left once again – mouth agape.

Even when the notion was interjected we could see a Bay Of Pigs styled replay at any given time, and that alone could bring on consequences no one has a clue about. Once again it was met as if all the powers that be are in fact “all-powerful” and can handle things with little to no disruption of any significance using , Greece, Spain, and even our own conflicts such as Iraq and more as validation.

I wonder how many besides myself felt quite unnerved when none other Iran was put back into the spotlight openly thumbing their nose in a way that Mussolini could identify with when none other than China publicly endorsed their relationship.

WWI began in earnest just about a month following the Archduke’s demise. Russia invaded Crimea in about the same time-frame. Couple with that the quickness of communist leaders publicly displaying solidarity reminiscent of events that transpired at the beginning of WWII. And the outright visible show of armament and the willingness to display it prominently under the noses of Western alliances suggestive of The Bay Of Pigs, and I guess there’s really no need for concern. After all we’ve got the latest and greatest deterrent the world has ever seen: #hashtags.

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TruthTalker's picture

Russia has been forvced into acting - they were not the aggressor

debtor of last resort's picture

When the agressor just pics the agressor, who cares?

chapaev's ghost's picture

A Frenchman, a German, and a Russian go on a safari and are captured by cannibals They are brought to the chief, who says, "We are going to eat you right now. But I am a civilized man, I studied human rights at the Patrice Lumumba University in Moscow, so I'll grant each of you a last request." The German asks for a mug of beer and a bratwurst. He gets it and the cannibals eat him. The Frenchman asks for three girls. He has crazy sex with them, and then follows the German. The Russian asks: "Hit me hard, right on my nose." The chief is surprised, but hits him. The Russian pulls out a Kalashnikov and shoots all the cannibals. The mortally wounded chief asks him: "Why didn't you do this before we ate the German?", the Russian proudly replies: "Russians are not aggressors!"

Zwelgje's picture

IMHO your joke needs some retooling. But a German and Frenchie getting eaten is a very good start.

the tower's picture


Russia could have decided to do nothing. Russia is just as opportunistic as the rest.

If you still choose sides in this world (other than your family and friends) then you still haven't learnt a thing...

Singelguy's picture

I don't think that Russia could do nothing. Sebastopol is the only warm water naval base in all of Russia. Had Putin done nothing, it would only have been a matter of time before NATO (aka USA) took over that base. Furthermore, inaction by Russia would have been seen as weakness and before long NATO would be in Poland at Russia's borders. How do you think the USA would react if Russia fomented dissent in Mexico, put its own puppet in power in Mexico City, and started building military installations near the Texas and Arizona borders? I highly doubt the decision would be to do nothing!

Abi Normal's picture

Ummm, all you have to do is look to Venezuela fella, you don't think Russia had anything to do with HC?  LOL...all you Pukin lovers just slay me...you have your heads so far up your asses, it's funny!

Why don't all you Pukin knob-end suckers just move on over to mother Russia, I bet you'd love it over there, bwahahahahahahah...dumb asses!

Mabussur's picture

Life will be better there after the reset. You sir are no different than the DWTS monkeys.

chapaev's ghost's picture

From an American POV, Russia is Mexico at the North Pole. Russian love Mexican soap operas, all dubbed into Russian. Russians and Mexicans paint their urban tree trunks white,  to about a meter up from the ground. Both Russia and Mexico have lots of revolutionary monuments that are crumling into dust- benign neglect is the best homage to past best intentions gone awry. Russia and Mexico both concentrate all power into one megalopolis, into which all wealth flows.

Both regular Russians and Mexicans are far, far better equipped to survive an economic collapse than are the peoples of Europe or America, ecause they are not tied to a system of dominance.

Look, if the Funds Rate creeps aove 1%, a deflationary depression will ensue that will destroy civilization as we know it. So, yes, the end of QE will be the initiation of WW3. I actually feel sorry for the western elite. The cognitive dissonance must be overwhelming. These are people who are intelligent, at least as far as IQ goes. But they made a decision, around 10th grade/BoysGirls State, to throw in with the system and "get ahead". Now, they are stuck. The system is broken, but these people have no means of working outside of it. All of their "solutions" are predicated upon system parameters. The thinking of the elite is based on system pre-suppositions and system paradigms.This is why they can do nothing but make things worse. My sympathy goes out to them because they are are smart enough to recognize that what they do doesn't work, but their greed, preconceptions, ingrained habits, and arrogance prevent them from thinking outside of the box.

Go ahead, laugh at Putin, but he has the cognitive upper hand. Putin is not constrained by the need to preserve power or prestige. His ego is not built upon a fading empire. I wouldn't want to get on his bad side, (although I doubt his body count is as high as Hillary's) but when it comes to power, the personal morality issues are relative, not absolute. In observing Putin, my impression is that he is basically honest with himself and with the rest of the world. Obama, Hillary, et al, on the other hand, are fundamentally DISHONEST, both with themselves and with everyone else. Obama is a fraud. He must therefore be dishonest. Hillary must psychologically disassociate her ego/self image from her actions. In other words, she has to see herself as a good person, even as she murders and lies on a daily basis. 

Putin does not suffer from these pathologies. I have no dout that if I crossed him, I would end up in prison or with a fatal dose of polonium poisoning. However, I think Putin would knonw what he is doing, and he would not try to fool himself about the morality of his actions. An honest criminal is better than a self-deluded fraud.

N2OJoe's picture

Yeah it sucks that they painted themselves into such a corner but don't think for a second that they wouldn't exterminate you and yours just to hold on to the fascade of power for one more hour.

Feel bad for them all you want, but rejoice when they meet guillotine.

daveO's picture

Polonium poisonings were reported by the MSM. That makes them highly suspect. It was to paint the picture of a 'Bad Putin'.  

RiverRoad's picture

Pecked to death by d*^cks or pecked to death by f*^cks; it still rhymes.

falak pema's picture

If we draw parallels with WW1; then Lehman collapse was Sarajevo moment and FED-QE is now war in the trenches. We are deep into FINANCIAL new WW1.

When FED-QE stops it means Kaiser Wilhem has surrendered and DOW going to zero is Versailles treaty moment. 

Then US oligarchy goes Weimar in the follow up and all the while China has a 1929 moment in the roaring 20s of Creditor Continent; Debitor Continents; aka USA/EU, find a new Mussolini and Hitler in aftermath of Weimar $/EU collapse.

We will be fascist bigtime in First world, reduced to tatters without Steve Jobs and the Chindia and Ruski Rich will hit their Great Depression, making the lights go out all over the world when Oil will have run dry. No renewables, as the global regressionist Oil lobby killed that hope good and proper. 

So...the Great Dictator Moment of new global WW2 will be around 2040.... right on time.

I'm glad I won't me around this time, just like the last time, when we had Euro/Japan WW2.

I was popped after Hitler died.

 Raindrops keep falling on my head...

PS : The only difference with that guy's mustache and our age is that these days our women folk sculpture their pubic hairs to look like that guy's mustache! Some Progress! 

Arius's picture

"Then US oligarchy goes Weimar in the follow up"


10 million dollar a day flip ,,,, we might already be there, not just told yet ,,,, the ultra rich might be waking up earlier and leaving while one still can

EggSlayer's picture

I don't get it. What is QE

sushi's picture

Your money in someone else's pocket.

NYPoke's picture

Monetizing Debt.  It is against the law.  Nobody cares, except the locals here.

bunnyswanson's picture

Quantitative Easing: 


Quantity not quality.

Easing into financial collapse.



mc225's picture

'quantitative shafting'

PT's picture

QE= Quantitative Easing = method by which bankers continue to get paid bonuses while lending money to people who can not afford to repay them.  Or, for a bit more detail:


Abi Normal's picture

Why do you ask what is QE? When you know perfectly well what it is...the debasement of our money!!!  That is what it is, when you boil it down...chairsatan II is a huge ? to me, and only time will tell if she continues or changes course...between the Fed and team Obozo, the dismanting of America is almost there...pretty soon nobody will be able to who the enemy is, because they will be everywhere, yep even in your back yard!!!!!!

BaghdadBob's picture

Nah, won't happen.

falak pema's picture

trees don't grow forever.

nosoeawe's picture

more like an "oh shit moment"

RMolineaux's picture

This item attempts to link things that are essentially unlinkable.  And it ignores inconvenient facts like the following.

1.  The Ukraine crisis was initiated by the US and its agents, along with cooperating NGO's that believe the cold war has not ended.

2.  Putin was pushed by events (reluctantly) to acknowledge the desire of the Crimea and eastern Ukraine to not be a part of a country dominated by a right-wing coup regime installed by foreigners.

3.  Russia's new cooperation with China was forced on it by the threat of sanctions by Europe and the US - these latter being the most recent accomplishments of the neo-cons and Brzezinski-led interests in isolating Russia, to the long term detriment of US security.

FeralSerf's picture

And Germany's invasion of France in 1914 was to prevent a losing two front war. She rightly believed that was the only possible way to survive. Germany didn't get to Paris as soon as she hoped and when she got there it was with hat in hand. The Russians were quicker at mobilization than she thought they would be.


When one plays these kind of games, it doesn't always work out as planned.

samsara's picture

I think you nailed it.

I believe your 3 points accurately depict the course of events perfectly.

If one really wants a quick check or reading on what view points ZBig et al want the proles to have, one only have to watch his daughter Mika a few mornings on Mornings with Joe.


Dadburnitpa's picture

Is the author confusing "The Bay of Pigs"  w/ the Cuban missile crisis, or did he just fail to reach me on the point he was trying to make?

TuPhat's picture

The author failed to reach me on any of his points and I think he may have been confusing a lot of things.  He doesn't seem to know who or what runs the world these days.

813kml's picture

Author should have stopped after writing the headline, it went downhill fast from there.

socalbeach's picture

Weak article once he started talking about international affairs. Basically noise since he got his facts ass backwards,

shovelhead's picture

Obama pivots and makes enemies.

Putin pivots and makes friends.

Funny, huh?

ATG's picture

HRC's favourite read, 1984, certainly seems prophetic re USA Grand Chessboard priapism of perpetual war on weaker opponents since WWII.

Yet Muhammad Ali and Ho Chi Minh won with ropa dopa.

So far Putin and Xi demonstrated that jujitsu lesson, while secretly arming themselves with EMP, hardened electronics, hypersonic missile guidance, satellites and tactical nukes that can take out US aircraft carriers and military bases, plus the Natural Gas Euro Weapon with Russian and Chinese third and largest real money reserves in the world.

These are interesting times indeed, as two top talkers noted:


Look for currency collapse to initiate any market or war volatility, since debt usury is really not money, but gold and silver are, according to the US Constitution.

The misreported JY Small Cap misvaluation comment, like higher interest rates in 6 months, was not in the Fed transcript and may have been wishful thinking:



In the past, $RUT led other equity markets. $RUT is currently down -10%.

Buyer beware.

While talking heads claim to be surprised long bond and note yields are falling with a reduction of QE "demand", it is worth remembering that was ersatz demand created by fiat money mirage.

Just as Obamacare did not increase affordable healthcare supply, but did increase government red tape, demand, prices and taxes, the inevitable result of central planning is oligarchic failure. 

One World Mafia's picture

On the one hand Yellen is cautioning about our dangerous debt level.  On the other hand she's arguing for more stimulus to get the economy going in order to be able to pay down our debt down.  Did I get that right?  Granny leading the wrecking crew charge.

fonzannoon's picture

Yellen knows it's growth or bust. One of the speakers this week told her that is interest rates rise we will be spending more on the interest on our debt than we spend on our military. she sat there silent, he sat there silent. after a moment of confusion the guy said "so obviously we need to grow our way out" and she said "obviously". there is no other way, and even though it's a pipe dream, the plan is to expend and pretend.

One World Mafia's picture

...no other way for them to keep pretending there is a recovery, might even repudiate the debt thru inflation if they choose or if their NATO friends can no longer import our inflation - better for them but much worse than a bust sooner rather than later for us.

Jorgen's picture

After all this serious financial (QE) talk, a relaxing moment with Eurovision 2014 winner and the song 'Rise Like a Phoenix':


And it wouldn't be news without Russia being involved (somewhat).

Tolmachevy sisters from Russia took 7th place, btw:




slowsmile's picture

No, Tyler says that it was Putin's brilliant timing on his assault of the Ukraine. But the American CIA were operating furiously in the Ukraine long before the Ukraine/Russia problem hit. The CIA were there stirring up the Ukraine crowd for independence long before the Ukraine problem erupted with Russia. 

Think Nicaragua, think Cuba, think Vietnam, think Columbia, think Iraq, think Afghanistan, All screw-ups. So you can blame the usual suspects. 

It's all about dictatorship control over global resources. Think Kissinger Report, think Washington Consensus.

Putin was given his opportunity in the Ukraine on a godamn plate by the US.

Love him or hate him, Putin is a strong leader while Obama couldn't manage his way out of a brown paper bag.


hangemhigh77's picture

If all these superpowers are dependant on one and other and so there can never be war, then what the fuck is going on now?  What is happening right now debunks that theory.  Add in China coming down on Russia's side, (who wants to partner with a psychopath, The USA), and you've got the other shoe dropping.  Add in the currency wars and China and Russia buying gold to back their own currencies and dump the dollar and you've got the Banksters deploying the US Army to your country locked and loaded.  I'd say it's on like Donkey Kong because in the end it's about POWER and the econimies are for the people not the insane "leaders".

Inbetween is pain's picture

Prior to WWI it was commonly believed by many that there would not be a major war because the important powers were so economically interwined (yes, even back then).

daveO's picture

The FED was created on Christmas Eve 1913. WW1 started the next year. Sure, the US wasn't dragged into it until it was almost over but, the bankers still made a fortune.

earleflorida's picture

Let's start with the Machiavelli doctrine: Three factors comprise his thesis? Love, Fear, and Hatred.

Rulers need not seek out love for it is dubious and fickle. But, rely on fear... for its predictability in the human psyche to herd societies. Lastly, hatred should be avoided at all cost-- because it manifest intself into hardcore enemies transforming myrmidoms into sworn adversaries.

Stalin (the last of the hard-core Bolshevik's) dies Mar.5, 1953, and ~38 years later The USSR expires Dec.26,1991.

Mao (the last of the hard-core communist?, 'The Great Helmsman of the People's Republic of China [PRC]') dies Sept. 9, 1976. Approx. 23years after Stalin's death... and ~15 years prior to the collapse of the USSR.

Why are these two characters and date-of death important? They changed history forever in the global landscape of planet earth. Both border each other and both are communist?

It was Japan that brought about the PRC via the USA Hawley-Smoot tarrif act of June/1930, which in turn shut-down Japanese markets to American agricultural goods, etc.,-- thus in July/1930 Japan invades Manchuria, China. This ended up fomenting the Chinese Civil wars and Sino-Japanese War, that didn't end until late 1949 when the dreaded communist won over the country?

Russia, USA, and Japan all played a large part in this coming about? This is what happens when regional wars turn global in a blink of an eyelash, things go south fast! Germany was the progenerate of both World WarI & II!!! The 'League of Nations' was a joke because the USA wasn't signatory, and the NATO alliance really was hamstrung from its inception because of Russia having its Red Armies in all Eastern European (Baltic States) and basically ignoring the Potsdam Treaty.

But, the main summary of this comment has more to do about america's 'Great Depression', that made the entire globe think twice about capitalism & democracy over socialism or the Marx's manfesto of 'One-Flew-Over-the-Cuckoo's -Nest-of-Political/ Economic-Suicide', communism!!! This in turn brought out the ugliness of a deceptive 'Bait and Switch'... Beggard-thy-Neighbor' enslavement. Sadly, the USSA today is on the precipice of financial armegettan via a liquidity-trap that could snare a Black-Hole eyesight?!?



pcrs's picture

Protectionism and boycotts will again be the first shots of aggression. Not because they achieve anything economically, but because the almighty all knowing rulers can never be seen to fail. Because economic failure is a mathematical certainty, they need a war to cover up their failure.

The drive of rulers is not money, it is power and dominating other human beings. The ultimate situation in which this can be done is war and concentration camps. Economic destruction is just a way to get there.

adeptish's picture

I liked this sentence.

"One can’t help but find the timing hauntingly coincidental that Vladimir Putin decided the window of opportunity to make his move on former parts of the Soviet Union was in near unison with the Fed."

Also this sentence.

"Personally I was left once again – mouth agape".

Fucking priceless.

Did you actually read this garbage Tyler?


Aussiekiwi's picture

Apples and Oranges, author reaches back in history to selectively compare situtaions with his own spin on them.

snr-moment's picture

And the bginning of QE as when the pistol was loaded.