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How Much More Upside Is There?

Tyler Durden's picture


For 5 years the correlation between the expansion of the Federal Reserve's balance sheet and the growth of the S&P 500 has risen dramatically. Since QE3 was unveiled, the correlation is converging on 1 which of course is just happy coincidence and nothing to do with the free and easy flow of liquidity that month after month of Fed largesse has created. The problem is we now know that the hurdles to a Fed un-Taper are very high and so we can extrapolate the end-point for the Fed's balance sheet and where stocks would trade at that point. The S&P 500's recent exuberance has priced in the total expansion of the Fed's balance sheet to the end of the taper, so how much more upside is there?




Perhaps not...


And close-up... we have priced in the rest of the Fed's balance sheet expansion to the end of the Taper... The S&P is actually around 20-25 points rich to the current levels of the Fed's balance sheet


Dont forget, tapering is not tightening... though it looks a lot like it will be...

As Jeff Gundlach recently opined...

What troubles me the most psychologically in the markets right now is this logic that as long as there is Quantitative Easing, stocks will go up.


And if the Federal Reserve drops Quantitative Easing, stocks will go up, too, because it means the economy is strong.


It makes me wonder.

But then again, Fed's Williams confirmed last night...

The Fed must blow bubbles because otherwise irrational investors get "carried away" and inevitably crash the markets...


Ultimately it seems clearer and clearer that, as Williams himself opines "financial stability is just as important as pursuing price stability and growth."

So prepare for QExxx


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Fri, 06/06/2014 - 10:26 | 4829907 dontgoforit
dontgoforit's picture

nOT pREpAreD for this....a fools game.

Fri, 06/06/2014 - 10:29 | 4829921 localsavage
localsavage's picture

This is getting old...

Fri, 06/06/2014 - 10:34 | 4829938 Mark Carney
Mark Carney's picture

Your New Normal:  Spanish 10Yr yield is only 7bpts higher then USA 10 yr.


All fixed!

Fri, 06/06/2014 - 10:39 | 4829952 Manthong
Fri, 06/06/2014 - 10:45 | 4829971 max2205
max2205's picture

Mark my will stop when billionaires become trillionares when millionaires become billionaires and when thousandaires become millionaires







........('(...´...´.... ¯~/'...') 


..........''...\.......... _.·´ 





Fri, 06/06/2014 - 11:01 | 4830029 THX 1178
THX 1178's picture

And when bread costs 250 a loaf.

Fri, 06/06/2014 - 11:33 | 4830135 SamAdams
SamAdams's picture

I suspect Greece and Ukraine are planning to buy $1T in treasury notes in the coming year.  You know, because Belgium is all tapped out...

Fri, 06/06/2014 - 11:37 | 4830179 thamnosma
thamnosma's picture

Pirates run Somalia.  Seems like a good place to set up some operations.

Fri, 06/06/2014 - 14:18 | 4830710 Vampyroteuthis ...
Vampyroteuthis infernalis's picture

I am telling you this now. Team Obummer is going to play the sound bite, "the US economy is strong because of my leadership" to death using the fake stock market and phony employment stats as evidence. Another thing is they will taper slightly to confirm this great lie. The taper is going to damage the fake recovery more than they realize. Debt driven expansions require more and more each round to be effective. Watch out below!!

Fri, 06/06/2014 - 15:13 | 4830925 TBT or not TBT
TBT or not TBT's picture

With NIRP, the correlation can exceed 1. BTFATH!

Fri, 06/06/2014 - 11:46 | 4830201 Four chan
Four chan's picture

kudos tylers this is an outstanding thread in many outstanding threads.

Fri, 06/06/2014 - 12:17 | 4830299 disabledvet
disabledvet's picture

Or when you pinch a loaf and that costs 250 bucks.


At McDonalds.


Where is the chart showing the Great Commodity collapse?


Where is that non correlated asset phuckers?

Fri, 06/06/2014 - 15:38 | 4831020 zaphod
zaphod's picture

No, that happened in Germany and they still had several exponential runs to go.

It will stop when people walk away from the dollar and fiat currencies in general. Only that will take power back from the banks/government. Until then this will continue.

I have walked away from the dollar in every manner I can (considering all my expenses and paycheck are nominated in dollars), have you?

Fri, 06/06/2014 - 11:18 | 4830107 icanhasbailout
icanhasbailout's picture

It depends. Adjusted for real inflation or not?

Fri, 06/06/2014 - 11:03 | 4829956 Headbanger
Headbanger's picture

Or in other words..  We've already reached full retard!

Also "financial stability is just as important as pursuing price stability and growth."  is an oxymoron!

Cause they're simply can't be endless growth as these fucking idiots want to believe.


And holy shit Batman!!  VIX IS DOWN TO A NEW 52 WEEK LOW!!





Fri, 06/06/2014 - 13:38 | 4830593 Professorlocknload
Professorlocknload's picture

Question is, will there still be enough liquidity left when VIX skyrockets, to pay out?

Gonna be interesting watching the entire stadium try to exit through a 12 inch porthole at once.

Fri, 06/06/2014 - 15:00 | 4830874 Bryan
Bryan's picture

The best job on the planet at that point will be scalping tickets through that 12 inch porthole.

Fri, 06/06/2014 - 11:16 | 4830101 EllaDara
EllaDara's picture

06/06/2014 will be remembered in history as Tday. When SP topped at 1949.5 and never returned again. (T as in TOP)

Fri, 06/06/2014 - 11:24 | 4830130 whatsinaname
whatsinaname's picture

Hello Sherlock.

Fri, 06/06/2014 - 19:33 | 4831560 bigfoot_st
bigfoot_st's picture

why not? 20-14=6, so you have a whacky 666 day!

Fri, 06/06/2014 - 11:16 | 4830102 EllaDara
EllaDara's picture

06/06/2014 will be remembered in history as Tday. When SP topped at 1949.5 and never returned again. (T as in TOP)

Fri, 06/06/2014 - 11:46 | 4830204 machineh
machineh's picture

T as in Toast ... for short sellers.

Fri, 06/06/2014 - 12:24 | 4830346 disabledvet
disabledvet's picture

Hope you assholes have a good muni bond guy.  Once that junk bond market gets nuked say hello to the Big Ugly Fat Phucker.

that's a trillion in issuance a one percent interest rates on the thirty year.  "Forever."

Fri, 06/06/2014 - 12:02 | 4830239 aardwolf
aardwolf's picture









Fri, 06/06/2014 - 10:27 | 4829908 PlusTic
PlusTic's picture

It's NEVER going down...

Fri, 06/06/2014 - 10:35 | 4829941 machineh
machineh's picture

For stocks, there hasn't been a down year ending in 5 for the past eleven decades. If we can make it through this summer, it's off to the freaking races.

So I'm projecting a Bubble III peak of S&P 2,720 in 2016.

Though it's a long shot, this is not entirely a joke. Central banksters are bat-shit crazy, so prudence will get you nowhere.

Fri, 06/06/2014 - 10:43 | 4829965 PlusTic
PlusTic's picture

there are no "natural" sellers, only we will just keep going from squeeze to 3-day selloff to squeez...until there are "natural" sellers again, we can't go down for more than a few days to a few weeks...

Fri, 06/06/2014 - 10:58 | 4830016 EHM
EHM's picture

Yes. It's the stupid fucking shorts that make it easy. When the stupid shorts realize they can't win then you might see something.

Fri, 06/06/2014 - 11:12 | 4830077 dontgoforit
dontgoforit's picture

We've given up on winning.  We're on the side lines selling popsicles to toothless grandmas.

Fri, 06/06/2014 - 11:39 | 4830182 thamnosma
thamnosma's picture

I like cherry, you got cherry?

Fri, 06/06/2014 - 12:30 | 4830370 dontgoforit
dontgoforit's picture

Of course; that's my favorite, too.  $250, please (inflation, you know).

Fri, 06/06/2014 - 10:47 | 4829976 SheepDog-One
SheepDog-One's picture

They're not crazy at all, they're just rounding up all the sheeple into the pen for the EZ slaughter.

Fri, 06/06/2014 - 10:50 | 4829983 Platinum_Investor
Platinum_Investor's picture

I really think that's a coincidence no down years that end in 5.  

Fri, 06/06/2014 - 10:57 | 4830010 dracos_ghost
dracos_ghost's picture

Except with QE/NIRP/ABE, there are no down years that end in a number.

Fri, 06/06/2014 - 10:28 | 4829910 LawsofPhysics
LawsofPhysics's picture

Before I answer that question, I'll like to know whether or not the author believes that debt actually has to be re-paid or not?

"Full faith and credit"

tick tock motherfuckers...


Fri, 06/06/2014 - 10:31 | 4829930 alien-IQ
alien-IQ's picture

Faith; A belief in something for which there is no evidence.

Fri, 06/06/2014 - 10:40 | 4829955 LawsofPhysics
LawsofPhysics's picture

Life is not black and white.  I have "faith" that the lights will come on in the barn when I flip the switch.  Oddly enough, you would be surprised how often that doesn't happen.

Fri, 06/06/2014 - 11:13 | 4830087 dontgoforit
dontgoforit's picture

Time for a re-wire?  I suspect we're going to get the shock of all shocks one fine morning.

Fri, 06/06/2014 - 11:28 | 4830143 Spastica Rex
Spastica Rex's picture

I suspect we're in for a very lengthy re-defintion of what it means to be an "Average American."

Fri, 06/06/2014 - 11:36 | 4830173 Haus-Targaryen
Haus-Targaryen's picture

I'm telling you guys -- get out. 

Fri, 06/06/2014 - 11:06 | 4830046 cosmictrainwreck
cosmictrainwreck's picture

Of course debt will not (cannot) be re-paid...simply repudiate/re-set currencies, etc. Was at town hall with congress critter waaaay long ago (1980's?). Da " budget" etc. interest as % blah blah. Asked "OK...what about principal? Anybody ever even so much as talk about that?" Reply: "nah"

Fri, 06/06/2014 - 10:28 | 4829912 alien-IQ
alien-IQ's picture

who gives a fuck.

Fri, 06/06/2014 - 12:29 | 4830362 disabledvet
disabledvet's picture

"Just pass the gray poupon bitch."  I like it.

"Free airfare to friggin Tel Aviv included."

Fri, 06/06/2014 - 10:29 | 4829918 Tabarnaque
Tabarnaque's picture

To infinity and beyond...

Fri, 06/06/2014 - 10:30 | 4829923 irongator
irongator's picture

So clearly it cannot be QE to infinity... There is obviously going to be some force that stops the QE (if our government cannot have self control). What is that force or threat that stops the madness, and then what happens?

Fri, 06/06/2014 - 10:30 | 4829924 Dr. Engali
Dr. Engali's picture

How much more upside is there? Just ask Zimbabwe.

Fri, 06/06/2014 - 11:48 | 4830209 machineh
machineh's picture

As billionaires, they are too busy counting $100,000 bills to pay for a cup of coffee.

Fri, 06/06/2014 - 12:57 | 4830490 NoDecaf
NoDecaf's picture

The only downside is that we won't be able to do the wallpaper thing.

Fri, 06/06/2014 - 10:31 | 4829925 tawdzilla
tawdzilla's picture

Can anyone answer me a serious question?  Where would the 10 year rate be right now if no QE had been done?


To ask in another way...specifically, how much affect does QE have on rates?  1/2%, 2%, more?  Thanks.

Fri, 06/06/2014 - 10:45 | 4829973 i_call_you_my_base
i_call_you_my_base's picture

It's probably much more than anyone would estimate. The idea that the Fed can and will control rates probably has more impact than the control itself.

Fri, 06/06/2014 - 10:47 | 4829977 machineh
machineh's picture

No one actually knows. Economics cannot run such 'alternate scenario' experiments.

Your null assumption, though, should be the QE has not affected longer-term rates (short rates are pegged by the Fed).

The burden is on the central banksters to prove that QE had any effect. And they can't. MORONS.

Fri, 06/06/2014 - 11:08 | 4830059 OceanX
Fri, 06/06/2014 - 10:30 | 4829926 madbraz
madbraz's picture

It is inelastic as the number of government bonds OWNED (not lent, not repoed) by market participants becomes lower and lower as a ratio to the total value of risk assets.  The more the stock market rises, the less owned collateral there is.  At some point players get scared, and the last ones dancing in risk markets get hurt the most.



Fri, 06/06/2014 - 10:30 | 4829928 ThisIsBob
ThisIsBob's picture

If you have cash, where else to you go with it?  Both Japan and now Europe are catching on.

Fri, 06/06/2014 - 10:35 | 4829940 SheepDog-One
SheepDog-One's picture

Go to the gun, razor wire, and farmland shows with the cash.

Fri, 06/06/2014 - 10:31 | 4829931 Winston Churchill
Winston Churchill's picture

It worked in Zimbabwe.

Oh wait...

Fri, 06/06/2014 - 10:34 | 4829934 SheepDog-One
SheepDog-One's picture

It will be the top when even Tweeters aren't fast enough to update Goldmans year-end S&P target.  May be there already, haven't 3 new year-end targets been blown past just in the last couple weeks?

Fri, 06/06/2014 - 10:34 | 4829939 Bill of Rights
Bill of Rights's picture

Hmm seems the CBO has lost touch with its data feed, how Ironic.

CBO throws in the towel on scoring ObamaCare | TheHill

No worries though jobs are plentiful, take that to the ballot box. The News stations must be going viral, not that anyone is watching.

Fri, 06/06/2014 - 10:38 | 4829950 SheepDog-One
SheepDog-One's picture

LOL they got baffled by ObaMao's bullshit big time.

Fri, 06/06/2014 - 10:37 | 4829944 slaughterer
slaughterer's picture

We really will have no period very soon where there is no operation/no policy.  We will be living in the midst of Fed rumors and counter-rumors, policy and counter-policy for the rest of our lives as investors.   

Fri, 06/06/2014 - 10:38 | 4829948 Puncher75
Puncher75's picture

I am convinced that the time MOST people will understand what is coming will be just as the walls start buckling, seconds prior to the roof collapsing in on their heads.  Sadly, some won't even understand at that point either. 

Fri, 06/06/2014 - 10:39 | 4829951 venturen
venturen's picture

what taper....they can't would expose the massive stealing of wealth by the richests and the criminal banks! Remember the richest don't pay taxes like you and me....they offshore it, they play the corporate shell game, they get laws passes to avoid it, they defer it, they put it in a charity that supports their life style....

Fri, 06/06/2014 - 10:41 | 4829958 Element
Element's picture



Market Peaks are a Process
John P. Hussman, Ph.D.
“It may also be helpful to remember that market peaks are a process, not an event. In the presence of a broad range of reliable valuation metrics uniformly at more than twice their historical norms, coupled with the most severe overvalued, overbought, overbullish, rising-yield syndrome we define, it is instructive how shorter-term action has evolved near those points. Outside of today and 1929, the other two instances are, not surprisingly, 2000 and 2007. The chart below provides a more granular reminder that market peaks are often a broad process and can involve hard initial downturns and swift recoveries. The ultimate follow-through provides some insight regarding the full scale of our concerns.”

Mon, 06/09/2014 - 20:55 | 4839186 Crisismode
Crisismode's picture



Do you believe this guy?


Fri, 06/06/2014 - 10:44 | 4829969 semperfi
semperfi's picture

how much upside did the zimbabwe market have at the comparable point in its great rise ?

Fri, 06/06/2014 - 10:45 | 4829972 buzzsaw99
buzzsaw99's picture was barzini all along

Fri, 06/06/2014 - 10:53 | 4829995 Hagen
Hagen's picture

F**k you Tyler. The every day it is the end of the wave with your site of shit and the every day the stock market contradicts you and goes up to the sky. You are not relevant.

Fri, 06/06/2014 - 10:58 | 4830018 ThisIsBob
ThisIsBob's picture


Fri, 06/06/2014 - 11:03 | 4830036 whatsinaname
whatsinaname's picture

Hagen - I am sure a lot of participants feel your frustration but TD is only the messenger.

Fri, 06/06/2014 - 11:11 | 4830069 semperfi
semperfi's picture

denial is a powerful drug - looks like you are completely addicted - your withdrawls are going to be a bitch

Fri, 06/06/2014 - 11:18 | 4830084 inky
inky's picture


Thousands of people on this site beg to differ with your view.

Tyler we (i hope i speak for most) are thankfull for all your hard work.

Fri, 06/06/2014 - 11:19 | 4830115 dontgoforit
dontgoforit's picture

If only that were true - but it isn't.  This bitch will pop so loud the moon will fly off to orbit around Mars.

Fri, 06/06/2014 - 11:51 | 4830212 kellycriterion
kellycriterion's picture

People who win over a long period by predicting the future are akin to the people who win playing the lottery.

Fri, 06/06/2014 - 12:47 | 4830451 Hagen
Hagen's picture

Can somebody name me only one prediction of Tyler who was carried out?

You have fun to frighten to you but at the bottom you all are long on the markets (I hope).

Fri, 06/06/2014 - 16:55 | 4831273 Greenskeeper_Carl
Greenskeeper_Carl's picture

They called the no taper several times. And they have been pounding on the gold manipulation for years, which more and more 'revelations' in the mainstream have shown them to be correct.

Fri, 06/06/2014 - 10:58 | 4830015 wagthetails
wagthetails's picture

with a NIRP?  much more, we haven't even seen the cash "on the sidelines come in the market".  i never believed that BS line, but as people finally wake up to the fact that rates will never rise and if we puch rates lower...we will be ALL-IN.  we'll hit 20k on the down...then 2k. 

Fri, 06/06/2014 - 11:03 | 4830038 babylon15
babylon15's picture

The interesting thing is that the Federal Reserve is expecting the balance sheet to shrink to $2 trillion by 2020 as the assets it's holding reach maturity.


If this really happens it would take the S&P 500 down to the 1000-1200 range by 2020.

Fri, 06/06/2014 - 11:21 | 4830121 dontgoforit
dontgoforit's picture

That could be a very prophetic call, babylon15.

Fri, 06/06/2014 - 11:04 | 4830039 BullyBearish
BullyBearish's picture

Bulls are crowing...bears are silent...planners are planning

Fri, 06/06/2014 - 11:13 | 4830081 semperfi
semperfi's picture

and a partridge in a pear tree

Fri, 06/06/2014 - 11:22 | 4830124 dontgoforit
dontgoforit's picture

The shit-show is so blatant even the dingle berries are clanging.

Fri, 06/06/2014 - 11:06 | 4830043 yogibear
yogibear's picture

The Federal Reserve's economic model is Zimbabwe. Super high stock market and crashing currency.

The Federal Reserve will back-door print to buy US treasuries being dumps.

An that gold the Federal Reserve held for other countries, it's gone.

Fri, 06/06/2014 - 11:06 | 4830049 Duke Dog
Duke Dog's picture

"The problem is we now know that the hurdles to a Fed un-Taper are very high..." stopped reading right there - the rest of the article is worthless.


The Fed, will not, and cannot taper without the implosion of the World economy into a steaming pile of shit. No consideration at all of the Fed's "off balance sheet activities.

Fri, 06/06/2014 - 11:22 | 4830127 dontgoforit
dontgoforit's picture

Do they think they can 'buy' the world?  The world is not enough...

Fri, 06/06/2014 - 11:08 | 4830062 semperfi
semperfi's picture

the markets are the new "savings" account

gauranteed by the Fed never to go down

Fri, 06/06/2014 - 11:23 | 4830128 dontgoforit
dontgoforit's picture


Fri, 06/06/2014 - 11:12 | 4830073 I Write Code
I Write Code's picture

To the moon, Alice Janet!

Fri, 06/06/2014 - 11:14 | 4830092 semperfi
semperfi's picture

'babwe style

Fri, 06/06/2014 - 11:13 | 4830085 GrinandBearit
GrinandBearit's picture

ZH came out in 2009.  Since then, the market has gone straight up.

Maybe if ZH shuts down for a while the market will go down.

Fri, 06/06/2014 - 11:23 | 4830129 The man with po...
The man with pointy horns's picture

We had some fun during the summer of 2011. August the 2nd was a particularly good day for doom and gloom.

Fri, 06/06/2014 - 11:18 | 4830112 alien-IQ
alien-IQ's picture

the VIX is .12 away from a 7 year low. I guess the real party starts when it hits single digits.

Fri, 06/06/2014 - 11:19 | 4830113 Madcow
Madcow's picture

one of two things is true:

a) we're headed into an era of record profitability, falling input prices and surging revenue


b) we're in the first innings of hyper-inflation


Fri, 06/06/2014 - 11:29 | 4830151 firstdivision
firstdivision's picture

Nothing will change til shit get violent, so expect more QE until 50% cannot afford to eat or stay warm during the winter.

Fri, 06/06/2014 - 11:29 | 4830154 OldE_Ant
OldE_Ant's picture

Honestly if this shit wasn't so sad it would be funny.

Market correction hurt people.  Sure but if you really think about it everyone at the bottom of the system is being fucked in the ass by the hardest nastiest cocks all the way up to FED chair who has biggest cock and is fucking everyone they can, and those being fucked like it because they are fucking others on the way down to Joe one pack on the street.

Who/what gets fucked pretty much all normal working stiffs, the planet, and everyone who is fucked up because fighting will break out as those being anally raped decide they arn't gonna take it anymore and turn on those fucking them.

How much longer until the real cracks are seen.  I see them already, prices in stores on basics in the past few months jumping at least 10% across the board either in smaller package sizes, or outright higher prices (or both).  Quality that is worse and worse (I mean it's good if things break in a year because every year you have to replace them).   Building stuff (autos) that pile up in lots to rots and then be written off (all being a positve on books, because accountants are creative).  Crappy food and poisonous containers that when you eat the food from them WILL cause disease.

I see it in the stress on peoples eyes, and faces on our roadways, walking in the streets, the drunken brawls and outright toe to toe arguments in places of work, and managers who simply don't give a fuck about anybody or anything until someone dies, but hey we have insurance to cover disability, or pay out on massive lawsuits.  Same deal with government - couldn't make a change if you dropped a bank full of quarters, nickles or dimes on their heads. and even then nothing would happen cept they'd make more speeches and lick more anus's because it's good to lick and bad to bite.

I see it in the bees having a harder time simply living on this planet, the babies diagnosed with "failure to thrive".  Children so screwed up and incompetent they will rather become scammers, theives, and in time murders to get the shit they want, or go to cosey prison where the rest of society and the govt./FED itself will print money to take care of them.

I see it in regulators who will sit on their thumbs because they are slated to be the next liars, theives and cheats so won't can't do anything to fix a problem or do anything to jeopardize their next career move.

I see it in people who won't do the most basic things to take care of themselves until a health problem arises and then will trust that little blue pill will make all their problems go away - and that very tiny print most people who need the pills can't read that says "careful while this pill will fix one problem it will make 1000 more, we warned you HAHA YOU DUMB ASS FUCKER".


MAKE NO MISTAKE we the people have been anally raped with dipping sand and they are about to attach spikes.  If you don't like it guess what we have people whose entire job is to shut those who scream when raped away so they can get special orifice retention training (i.e. cock in your mouth as well as ass) until they are 6 feet under or properly reconditioned.

I see it in people who actually saved, were prudent and doing the right things in the stress in their eyes, the sadness, anger in their voices wondering why they arn't being given an opportunity at lower priced things (to buy the real dip) and interest rates that pay virtually nothing while governments are attempting to collect and use everything.

I see it in dead cattle that died in freak blizzard this year, I see it in children and young adults who have no clue what they are going to do to eat, have a place to sleep, or anything of a real life.  I see it in people who don't have money and who never will, as well as the select few who have some but watch real necessity buying power being hammered into dirt.  I see it in incompetent people who don't give a shit about what they do trying to scam others, and yet others who are just outright theives stealing from anyone who is weak.

I see it in improved disease strains of all kinds coming on board as we continue to be lasx about how we manage health and disease.  I see it in unhealthy people both in body, mind and spirit.

It see it in markets that are no longer connected to reality, and to huge number of people who are no longer connected to reality.

Fortunately like all things this suffering will end and new suffering will begin.



Fri, 06/06/2014 - 11:36 | 4830170 BeetleBailey
BeetleBailey's picture

Well stated Ant...+1,000

Fri, 06/06/2014 - 22:08 | 4831803 Pig Circus
Pig Circus's picture

"I see it in..."

Yeah but Fag marriage is legal, we got our soldier back and are about to legalize 50 million downtrodden Mexicans!

Fri, 06/06/2014 - 11:31 | 4830157 thamnosma
thamnosma's picture

There is only upside, don't you get it by now?  It's different this time.

Fri, 06/06/2014 - 11:34 | 4830165 BeetleBailey
BeetleBailey's picture

How much more?

My take?

S&P 2000

Dow 20,000

Nasdaq 5,000 long as the mass of sheeple are mollified...this could go on quite a while...

The Tyler's are putting forth the TRUE facts of a fundmental data feed that has been hijacked - irrelevant - and - the 2008-9 to present will be looked back as;

Don't fight the Fed/central banks....

Money becomes worthless 2011-2015....


That's what will be taught in 2040 history classes...that is...if there IS even a classroom left....

Fri, 06/06/2014 - 11:41 | 4830187 dontgoforit
dontgoforit's picture

2016-1/2  - "Who would've ever thought the DJIA would top 25,000?  Damn!"

Fri, 06/06/2014 - 15:31 | 4830429 dontgoforit
dontgoforit's picture

Correction - make that September 2014.  At the rate these things are climbing, we're going to need a rocket to keep up.  Remember the Challenger.

Fri, 06/06/2014 - 12:30 | 4830369 taketheredpill
taketheredpill's picture




Check out post at Salient Partners:


The Island of Green Eyed Men


Common Knowledge is that Taper is because US economy is in self-sufficient expansion.  That is, that's the "story" attached to rise in SP500, abobe and beyond the Fed funded speculation.


As soon as something disturbs the Common Knowledge, such as Q2 GDP coming in < 2%, then things change.  Assuming there are any actual alive people still trading...


Fri, 06/06/2014 - 12:34 | 4830392 taketheredpill
taketheredpill's picture



Also, regress on Fed B/S and SP500 gives SP500 2025 using 2012-2014 end and regress on 2009-2014 end gives SP500 1940.  You can get slightly different numbers using different starting points but still looks like we are getting close.


Then what?


Fed hints that they will do "something" and market pops again.


Who knows.  I hate this career now...


Fri, 06/06/2014 - 12:51 | 4830473 I Write Code
I Write Code's picture

I dunno how *much*, but this volatility squeeze between Yellen's knees looks like it's going to pop out to the upside, which I guess is no surprise except maybe to Yellen, both VIX and the indexes will pop up together.  I mean, the indexes must rise ("the spice must flow"), and that requires at least a *little* more volatility, unless we're going to go to one price adjustment per day instead of active trading.

Fri, 06/06/2014 - 12:57 | 4830487 q99x2
q99x2's picture

There are only so many stocks. The sky is the limit.

Buy the F'n Dip. Long live Altucher.

Fri, 06/06/2014 - 14:18 | 4830709 jameswvu99
jameswvu99's picture

Feels like some where inbetween the manic phase of a bull market.  I remember always reading blog between 2003 and 2007 and commenters kept on trying to guess the top.  Comments on here feel very similiar.

Fri, 06/06/2014 - 15:50 | 4831061 Droid Fuel
Droid Fuel's picture

Question; I don't want to pull all my money out of mutual funds due to the penalty.  Presuming there is a 30-50% market correction coming down the pipe is a money market fund the safest location?

Sat, 06/07/2014 - 02:15 | 4832059 BeetleBailey
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You just get in?

Too general of a question.

That said....asking a question such as that on this forum is......

....both weird and troubling....flying without direction, are we?

Plenty of "saf-ER" thing than MM's....PM's to collectables...avoid fucking off your debts if you have (and don't accrue any new debt) unions/safes/hidey-holes....

Preppers will say ammo, water, food, shelter, get in shape...and PM's...coins...met several Preppers...NOT stupid, and those that I would be amongst when TSHTF

If your fund has a MM, your penalty should be 1% if you haven't been in a year (most no-loads have that)...

weigh the 1% vs what you wrote.....

Lastly, the question was asked "all my money"....

Why all of it?


Sat, 06/07/2014 - 10:05 | 4832272 swmnguy
swmnguy's picture

I'm going to guess he's talking about an IRA or 401k or something like that.  LIke myself, not a finance professional.  "All His Money" means, "All His Money in the tax-advantaged retirement vehicles."  And, if he's like me, that's his second-biggest pile of money, if one includes home equity.  For many people, if they bought a home in the past 10 years, a pittance in a retirement account is their very largest pile of money, and they're realizing it's locked in an airtight vault and the air is getting thick.

I'd agree with your comment that it's too general of a question.  And I'd agree with your advice.  What you suggest are among the things I'm doing.

Fri, 06/06/2014 - 16:05 | 4831113 CaptainSpaulding
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To da moon Alice.

Fri, 06/06/2014 - 17:24 | 4831345 matrix reinvented
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Greed got us here and greed will finish us here. Regardless of where it falls. Everywhere you go, always take the weather with you, everywhere you go always take the weather.

Fri, 06/06/2014 - 19:19 | 4831526 venturen
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average house a million, dow 50000, beef $20/lb....zimbabwa, Baby!!!!

Fri, 06/06/2014 - 23:10 | 4831882 Quantum Darwinism
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Here in Vancouver median detached house price is already about that 1 million... -_-'

Sat, 06/07/2014 - 10:06 | 4832274 swmnguy
swmnguy's picture

That is so FUBAR.  That assumes a median household income of what, $250,000-$400,000 or so to be healthy, right?

Fri, 06/06/2014 - 23:14 | 4831890 SyndicateOne
SyndicateOne's picture

Must.... Keep........ Markets........ Going..... Up.... 

Sat, 06/07/2014 - 08:09 | 4832193 AdvancingTime
AdvancingTime's picture

Much of the economic landscape is beginning to look like something out of  "Alice And The Looking Glass" A bizarre  and unrecognizable land, a land that is distorted and papered over by ream after ream of paper. This paper has been rolling off the printing presses of central banks all across the world in an attempt to mask reality.

Peter Schiff says, printing money is to the economy what taking drugs is to a drug addict. In the short term it makes the economy feel good, but in the long run it is much worse off. What was once the "long run" or "distant future" may be getting much closer. More on this in the article below.


Sat, 06/07/2014 - 09:53 | 4832266 J J Pettigrew
J J Pettigrew's picture

Two of lifes lessons....

The Fed and the Supreme Court can do anything they want

Sun, 06/08/2014 - 18:40 | 4835141 double 007
double 007's picture

along there is paper & ink

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