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Data Dependent Fed Ignores 'Data' - Bullard Joins Williams In Call For QE4
As yet another fed speaker takes the jawboning lectern today, it is becomingly increasingly clear that The Fed truly has only one mandate - to keep stocks up. While claiming to be "data-dependent", which judging by the general trend of government-supplied data (and President Obama), things are going great; Jim Bullard joins his intervention-prone colleague Williams:
BULLARD SAYS BOND PURCHASES SHOULD BE DATA DEPENDENT
and
SAYS 'U.S. FUNDAMENTALS REMAIN STRONG'
but
BULLARD SAYS FED SHOULD CONSIDER DELAY IN ENDING QE.
So much for data-dependence...
* * *
And the market loved it... briefly
* * *
And yet in March 2010, Bullard advocated the end of QE:
Steve Liesman: Jim, picking up on the Senator's question, what is your preferred way for the Fed to get out? Should the Fed raise rates and keep that $2 trillion balance sheet the same, or should it be selling assets first, and then raise rates?
James Bullard: I've been advocating sort of a LIFO policy—last in, first out. You've brought your rates down to zero. Then you substituted quantitative easing for the fact that you couldn't bring rates any lower. Now it seems to me like the natural thing is to withdraw the quantitative easing, and then, at some later point, raise interest rates. But I'm a minority on that, but I'm working on it.
* * *
Of course, maybe this is just posturing as Bullard is non-voting until 2016.
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Say you’re a hedge fund.
You have 100 billion dollars under management.
50 billion in stocks and 50 billion in commodities.
Things go bad on one side of the trades.
Really bad.
Like oil!
What effect does selling 50 billion dollars of stocks have on a market?
What if more than one hedge fund has poorly traded oil?
"Helicopter's Bullard and Williams ready for take off." "Commanding Helicopter Yellen preparing her money drop packs for tomorrow."
Umm, Clueless??.....
No, they just want to add a bit of stability. The Baron isn't quite done liquidating. Then it's off to the bunkers
They can add QE 4eva, but they know that out of 4 trillion, 2.5 TLN is excess reserves on banks, so that condition is not binding. (and a bunch more in treauries on banks balances) This may cheer the market temporarily and only aggravate the situation in the future.
"The Fed truly has only one mandate - to keep stocks up."
at least until November 4
Another hundred points on the ES should end all talk of ending QE.
I'm not one to toot my own horn, but this is exactly what i was talking about yesterday. the Fed has gone from reckless to reckless-er.
after 6 years I'm pretty confident I know better than most how they think, and what they are going to do given incoming market/econo information.
it's hyperinflation or bust for these guys.
Wed, 10/15/2014 - 12:42 | 5334805 Wait What "this is a shot across the bow for Yellen and friends to do something, like restart QE immediately. that the FOMC will conduct an unscheduled meeting tomorrow only confirms on Oct 30th they will announce a continuation of QE for another quarter." the Fed will forever yield to markets because it is filled with spineless, weak-willed cowards who will continue to throw money at a problem that can't be solved by money alone. this is why i think they are so completely wrong in their attempts to solve this financial crisis (it's still ongoing), and why the consequences of their lack of follow through are going to be devastating.dup
Because of the chaos we see
The Fed will continue QE
It's not the inflation
Or jobs in the nation
The "data" they track....S&P!!!
You are indeed!
But QE is going to end automatically in a couple of weeks. The only way it won't end is if they call a special, unscheduled Fed meeting in the next two weeks and there vote to extend QE. I'm not buying it. I think it's classic Fed "good cop bad cop" BS.
They are trying to convince the sheep that they are not going to get slaughtered. They want to keep them long here. We might get a run up the next couple of days, but 2000 again on the S&P is probably just wishful thinking
I think you are right. The plan among the bankers and wall street boys is always to sell their stocks to the late-arriving public at the top and then buy them back again at the bottom. They need periodic rallies to convince the small fry that the market is heading back up and buy more stocks.
This must be carefully orchestrated so that retail, who is late to the party as usual, will see this as a buying opportunity. Big dip, big recovery and maybe repeat a few times so the BIG dip will be bought.
"..... and keep that 2 trillion balance sheet"
$2 T seems so quaint now. We were all so much more innocent then. :(
No idea what you are trying to say. Hedge funds have strict risk management and liquidty risk is one they look at closely.
Oh and Bullard's comment is nothing. They can delay QE ending by a month.. big deal QE ends a month or two later.
Amaranth Advisors LLC was an American multi-strategy hedge fund founded by Nicholas Maounis and headquartered in Greenwich, Connecticut. During its peak, the firm had up to $9 billion in assets under management before collapsing in September 2006, after losing in excess of $5 billion on natural gas futures.[1] The firm's failure was one of the largest known trading losses and hedge fund collapses in history.
This is what I am trying to say.
Of course "it could never happen again"!
Don't forget LTCM in 1998 that almost brought down the world's economy
Still don't know what your point is.
Yes a hedge fund could blow up. It's happened in the past and will probably happen in the future.
The good thing about futures contracts traded on an exchange is that the exchange makes sure everyone gets paid.
The point is that if you “HEDGE” you have two sides to every trade, so to speak.
If you have a large side loss, it is made up by selling the other side.
If the hedge-gone-bad is in the billions, and the hedge-gone-well is not, where does the “money” come from?
If the “counter-party” participants have similar hedges or exposure to participants, it is systemic and failure is not an option.
How many “traders” do you think foresaw oil with an 8 handle?
This volatility looks like “hedgehogging” to me.
The good gets sold by the losers, and immediately purchased by the winners at a discount.
BTW, hedge funds are cesspools of criminal behavior – not pools of virtue and integrity.
They write the rules they do not follow.
Well, the clearinghouse does, but I think recently those two entities merged for some exchanges. The point is that the exchange can suspend trading or the entire exchange, DK trades etc etc if the market moves too many positions out of posted margin too quickly and the clearinghouse can't cover failed margin calls.
But Hedgies also trade OTC.
but of course
Say there are $100 Billion at risk - buying half the FED Governors for $100 Million a piece would be cheap.
it's all CYA...
It won't make a difference.
Even E*Trade Baby is disregarding Fed member jawboning.
They've talked themselves into near irrelevance.
In fact, E*Trade baby just tweeted -
#4.3 trillion reasons Fed is full of shit.
Helo ops, coming soon.
How can you be data dependent when all data is fake?
Are you saying they are additcted to a farce. I think that disease has been wide spread for a long time. Just look at the elections as we keep returning idiots to washington.
I guess thats the point
We have to ignore the data to restore the credibility of the data.
The data they're dependent on is the stock market, not the economy or unemployment. As long as the stock markets are up up and away, the government buffoons can't point to it and tell us the economy is great.
The Clown Parade continues.
Ass Clowns
QEbola coming
That juiced the market for about 5 minutes. May be the shortest jawbone ever.
Band Saw Jawbone
Jawboning, wait until they panic.
everything the fed says is a lie. remember that.
repeat after me: WE must keep risk assets elevated...WE must talk the $ down
They don't want the dollar down. They want the dollar up. The Fed serves the banks, and the banks can make more money now by a strong dollar. That's all you need to know about what the Fed will do.
$hyte $torm i$ gathering $trength.
that should be good for a 200 point ramp.
You guys really need to learn how to count. This isn't QE4. It's QEinfinity+1. MAYBE QEinfinity*2.
Edit: ZH can't display the infinity symbol. Ironic.
lol
Bullard: "It is unacceptable to allow the 1%, the TBTF banks, or large corporations to no longer be able to enrich themselves at taxpayer expense. We particularly believe it is unacceptable for greedy corporate executives to no longer be able to conduct share buybacks to fraudulently increase EPS and bonuses. We are also very exited about how well the TBTFs and Primary Dealers have injected ZIRP and QE monies into the economy instead of using it as a means to further enrich themselves. In our estimation, it is just a matter of time - maybe mere months - before this latest extension of QE shows up on Main Street through the trickle-down affect."
Trapped like RATS.
I'm wondering what will happen once the FED have bought all existing assets in the market?
I've been thinking that too, and came to the conclusion that possibility is exactly why the Fed wll not and can not keep QE forever. The Fed has to maintaine the facade that they are working for "Main Street", etc., etc. Buying up all the tangible assets breaks that illusion. The American sheeple will put up with a lot, but there's no way they put up with the banks owning everything. Then it's 1789.
Propaganda can have fanatstic achievement ! As long as the smartest can find a way to get money out of it, I doubt any revoluting will occur...but I might be wrong, I hope so...
Once the FED has bought all the assets, they will go full on Banker Communism.
The EBT dependent majority will love it, even vote for it Bitchezz!!
Translation:
TA soldiers tell me we must try to break 1870 with volume to capture momo monkeys and let the dream live a little longer.
HOW MUCH IS WALL ST PAYING THESE TREASONOUS CENTRAL BANKERS?
If they were time dependent, they'd just add months to the calendar: Smarch, Greenspantember, July 2.0, etc.
What a pussy. The SPX needs to hit 1817 for a measly 10% correction and he's peeing down his leg already. BTW QE doesn't work anyway you twit banker.
If QE worked we would have had the fastest growing economy in the history of mankind--two years ago.
They must feel like the Shaman who kept executing virigns to stop the plague. The plague kept coming, and then there was no one left to screw.
And all they really had to do was simple. Quaratine.
Another status quo stooge is chiming in already.
World economy so damaged it may need permanent QE
..can someone tell what events (short of zombies roaming) will push gold back to $1800?
and i'm serious, what can or will get it back up to where it was in 2012?
fate
There's increasingly little economy there...only monetary inflation. At somepoint they have to acknowledge that inflation doesn't create wealth, only redistributes it.
We said last week...You aint seen nothing yet from these clowns once Ebola cases start getting reported all over the U.S/Europe/Asia. The amount of bullshit that is about to spew out of their mouths will be blinding to the eyes and deafening to the ears. Look how panicked they are over the prospect of stocks crashing...you know why....because Ebola is one of the few things that will bring this farce to an end..
Ebola does not care about QE...they could have infinte QE....they could even double their purchases of securities...it will not matter...And I promise you as this takes hold the last thing on even these assholes minds is going to be STOCKS...it will be survival...Stocks should be crashing naturally anyway based on how we have been in a depression for 6 years going on 7 anyway even with all the makeup on the piggie..
What is really going to start frustrating them is the fading of all their jawboning of all their coming rumors in the next few week..
Ebola doesnt watch tv and doesnt read Reuters...it just does what it is intended to do...the irony that a parasitic virus may be the downfall of the ultimate parasites in D.C. and on Wall Street.
He received a threat against his family to change his position
Fed cannot let anything normalize.
Wait until the rest of the world realizes the Federal Reserve cannot raise rates and it's printing to infinity.
That the dollar is not that safe after all.
Peter Schiff has been saying QE 4 and more until there is a dollar crisis.
More panic
Desperate attempt to lure any suckers left.
None left
lot of suckers left, that comment was good for a 200 point bounce on the DOW...
no liquidity. NSA is overriding the computers and typing up numbers
there's on born every minute
The only data point they look at is the S&P500.
Peter Schiff was right again.
I guess they didn't get every single penny from the middle class...QE4-100~
Linear thinking on display.
The Federal Reserve is building a model for a currency crisis.
Next after QE, the dollar tanks and Fed reverts to IMF SPDR's.
Get out of dollar while it's at it's high.
You know, this has occurred to me too. Could it be that the "plan" is to replace the dollar with some new, revalued currency? Their plan might include ways to fiddle with the revaluation so as to minimize their losses, of course.
All these actions would make more sense, I guess. Create a crisis with your currency, then be "forced" to retire the old, and issue a new currency in order to save the system. All YOUR obligations will be carefully translated into the new American Dinar, all your gains and assets retroactively revalued (down, of course).
It would be a way for them to try and preserve their holdings and valuations in the face of a dying currency. Better to kill it off quickly, so as to control its replacement, rather than wait for things to get out of hand. They know the change is coming, maybe they are trying to position themselves ahead of it.
Jim Willie calls it the "Schiess"dollar. German for shit. Excuse spelling.
see, i was right. A FED donkey says QE4 is needed, and in a matter of minutes a 200 point drop is erased.
I should day trade.
I wouldn’t be too discouraged; they are nearing the end of this. They really are. Nobody but profligates wants the Fed’s banker confetti anymore. When there’s no market anymore but what they say, then it isn’t going to last much longer. The country is so much more than this.
jim bullard is an asshead.
if yellen extends POMO and markets rocket, the CONFIRMING message is that the Fed is in the business of pushing markets up.
opponents will call for yellen's head and likely barry's head too.
barry already had an elevator ride with an armed fellon.
yellen would look good in concrete shoes - would cover up those kankles.
The Adventures of Photoguy - Episode 19
http://m.youtube.com/watch?v=Q1KhY-9wwxo&list=UUlnNHe7uaFmo4CapfqHRy6w
The baton has been carried to Yellen.
They've entered the roach motel of monetary policy, you can start QE but you can't get out. It's like trying to get a junkie so high that he doesn't need heroine anymore.
Market is full of a bunch of junkies. If people haven't considered us having gone full Banana Republic yet, any more QE should bring that consideration to the forefront.
To have any chance at "fixing" the actual economy, QE4 would need to fund the US government so the personal income tax and maybe even the corporate income tax can be temporarily eliminated. Gov could pay Fed off over the next 99 years. Hey, we have 7 year car loans now.
JAMES BULLARD: Steve, The Fed's balance sheet hasn't been below $2 Trillion since 2009, what are you on? When we print money, we REALLY print money, dude.
It’s official. The backing of the U.S. currency is now 100% from the owners of the NY Federal Reserve Bank.
They are the only force involved in setting the value of America’s resources, labor and future.
They will decide who wins and who loses and it’s clear the winners they have selected are themselves.
I don’t want this money as an exchange medium anymore because it is only a ticket to stealing.
This is beyond rediculous. There will be more QE, we shouldn't even be speculating on this. Whether it is stealth or not doesn't matter. It will come to a point where they are stuffing Goldman's and JPM's CPUs with so many 1's and 0's and orders to buy everything in sight that they will be buying and selling stock to themselves. Aside from the people on Zerohedge, no one understands this, therefore, no one gives a shit.
The fed can do what ever they want. They have been so far and why should that ever change? If they fed monitized Janet Yellen's shit, there would be buyers.
I'm not defending the fed. I hate the fed. I just don't see at this point how anything will ever change. This fucking charade will continue indefinitely unless ebola hits lower manhatten and DC.
Bwahahahaha. Indeed. Good observation.
The Federal Reserve needs to remonetize it's Quantitative Sleazing program.
Remember, you told everyone that free money was good to boost the economy and create new Employment. Appears the printer has become jammed on Return of investment. (ROI)
/LMFAO - Fucking fools never learn.
Let me tell you something. If one of these guys (gals) were to take a deep breath, close their eyes for a moment of reflection, then stride purposefully towards the mic and, looking all firmly in the eye, say "We're withdrawing ALL artificial supports for markets starting NOW. A free market must be free to advance AND decline. Our job will be to try to mitigate the worst effects of such declines, and monitor for 'bubbles' during advances. Other than that, you guys are on your own."...well, I believe that the markets would have a brief conniption, then as the meaning of those words started to sink in, we'd see price adjustments, and the biggest rally and economic recovery, in history.
It would be like the way you feel after finally puking after a long bout of nausea. All the Fed has to do is hold the economy's hair back and let it happen...
Pushing on a string.
<----Jim Bullard - getting stoned to death
<----Jim Bullard - burned at the stake
I realize this is a hard choice, so take your time.
is he a jew or a witch?
And this is what the selloff is all about. Ensuring that the Fed keeps QE-ing this failed "market".
The finanicial terrorists have won. Again.
and it only took an S&P selloff of 5% to get the job done!
I'm coining a new phrase: "Full Bulltard".
Heroin4