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Why James Bullard Won't Bail Out The Market's Next Correction

Tyler Durden's picture




 

Because when even the BIS tells you to keep your mouth shut, as it just did very publicly...

It is, of course, possible to draw comfort from recent events. Those who do so stress the speed of the rebound. At the same time, a more sobering interpretation is also possible. To my mind, these events underline the fragility - dare I say growing fragility? - hidden beneath the markets' buoyancy. Small pieces of news can generate outsize effects. This, in turn, can amplify mood swings. And it would be imprudent to ignore that markets did not fully stabilise by themselves. Once again, on the heels of the turbulence, major central banks made soothing statements, suggesting that they might delay normalisation in light of evolving macroeconomic conditions. Recent events, if anything, have highlighted once more the degree to which markets are relying on central banks: the markets' buoyancy hinges on central banks' every word and deed.

... you keep your mouth shut.

 

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Mon, 12/08/2014 - 15:45 | 5529675 kliguy38
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He'll do what he's told

Mon, 12/08/2014 - 15:57 | 5529695 hedgeless_horseman
hedgeless_horseman's picture

 

 

 

Why James Bullard Won't Bail Out The Market's Next Correction?

Because that is Kevin's job.

Score today's V-Shaped Reversal: 

  • Not Very Subtle
  • Not Very Natural
  • Expected 
  • Unjustified
  • Inappropriate
  • Very mechanical
  • Unbelievable
Mon, 12/08/2014 - 15:56 | 5529732 zaphod
zaphod's picture

Central banks already have the petal on full gas to "support" the world economies. Massive printing, massive government deficit support, unlimited backstopping and proping up of bank assets (MBS,etc), ZIRP and now NIRP. 

If/when the next downturn hits, just what are central banks going to be able to do? Every tool is already spent, and if that happens WHILE a downturn happens, then options are over and we'll have a SHTF moment. 

Be prepared. 

Mon, 12/08/2014 - 16:21 | 5529834 tc06rtw
tc06rtw's picture

Oh, that’s OK

We’re not going to  HAVE  downturns anymore !

Mon, 12/08/2014 - 16:28 | 5529861 espirit
espirit's picture

As I've mentioned before, there can be only one.

Goldman Sachs will feed upon the others, JPMC et al.

When there's only Barracudas left in the pool... 

Mon, 12/08/2014 - 16:39 | 5529894 flacon
flacon's picture

Are we running out of time in 2000-and-FOURTEEN for Ms Lagarde's "Occult Blitz"? 14 is two SEVENS and all that. 

Mon, 12/08/2014 - 17:30 | 5530036 knukles
knukles's picture

Dude reads ZH. 
Screen name BangaloreEquity

Mon, 12/08/2014 - 15:57 | 5529737 slotmouth
slotmouth's picture

Because he'll be suicided by way of nail gun if he doesn't.

Mon, 12/08/2014 - 16:04 | 5529763 NoDebt
NoDebt's picture

<---- the nail gun is always up for a new contract.

Mon, 12/08/2014 - 16:02 | 5529749 Jumbotron
Jumbotron's picture

Bull...Fucking....Shit.....he and everyone else won't bail out the markrt.

 

That's all that's left.  Of course they will bail out the market. 

 

Get to work Mr. Yellen!

 

 

Mon, 12/08/2014 - 15:45 | 5529678 Dr. Engali
Dr. Engali's picture

But if the market goes down just forget we said anything..... everybody else will.

Mon, 12/08/2014 - 16:07 | 5529778 NoDebt
NoDebt's picture

"The next time the kids start screaming they want the newest X-Box game, I'm going to be firm with them and handle the situation differently than the last 10 times."

- Mrs. NoDebt

Guess how that usually turns out?

Mon, 12/08/2014 - 17:31 | 5530038 knukles
knukles's picture

Like the Menendez Brothers?

Mon, 12/08/2014 - 17:35 | 5530054 Greenskeeper_Carl
Greenskeeper_Carl's picture

I think we got all the evidence of that when we saw him start flapping his asshole mouth the minute we had a few % pullback. Didn't even get into real 'correction' territory of 10% before they had to mention further easing. Maybe he thinks he can be like draghi and get positive market moves just by talking.

Mon, 12/08/2014 - 15:47 | 5529679 Eyeroller
Eyeroller's picture

Since WHEN have the central banks heeded the advice of the BIS?

BIS was warning in JULY that markets were too complacent...

Mon, 12/08/2014 - 15:50 | 5529698 insanelysane
insanelysane's picture

WAR IS PEACE!

Mon, 12/08/2014 - 15:51 | 5529707 wendigo
wendigo's picture

Instead of chemtrails, maybe they're spraying acid in areosol form everywhere. 

Mon, 12/08/2014 - 15:59 | 5529739 TruthInSunshine
TruthInSunshine's picture

Israel gets sexually aroused in a collective frenzy using white phosphorous on civilians.

Mon, 12/08/2014 - 15:52 | 5529702 LawsofPhysics
LawsofPhysics's picture

....but he will continue to provide billiions if not trillions to his friends at 0.01%...

 

see the real problem yet motherfuckers...

Mon, 12/08/2014 - 15:51 | 5529704 order66
order66's picture

But the NY Fed buy programs will.

They're running the "V" bottom algo in the ES right now.

New ATH within the hour.

Mon, 12/08/2014 - 15:53 | 5529709 Dr. Engali
Dr. Engali's picture

Why do the markets need the fed? All we need is for Tyler to publish a piece about stawks being down and that will be sufficient to push them higher.

Mon, 12/08/2014 - 16:01 | 5529750 ZoroAustrian
ZoroAustrian's picture

Careful Doc,

In a previous life I got banned / blocked for harping on the amazing timing of rebounds off of ZH posts about falling markets (at least that was my best guess, they don't tell you anything) ... Tylers are sensitive, doncha know.

Crazy though, the phenomenon, isn't it?  What, are all us ZHers using ourselves as contrary indicators?  And do we have that kind of market moving power?  Or is Kevin just plugged in directly to ZH with a co-located server so he can just stick it to Tyler by the nanosecond?  Curiouser and Curiouser.

Mon, 12/08/2014 - 18:40 | 5530289 emersonreturn
emersonreturn's picture

zoroA...hope that's you fonz?

Mon, 12/08/2014 - 15:52 | 5529712 disabledvet
disabledvet's picture

Rates can and in fact only have gone higher here. The only reason treasuries are soaring is because this is a massive equity bubble and treasuries remain the only non-correlated asset. Product from all over the world is now flooding into the American market. No way these prices can be sustained. That would include metals prices.

Mon, 12/08/2014 - 16:07 | 5529773 Consuelo
Consuelo's picture

Yeah, if you're China, Russia, India, Arab nation's etc., why would you wait and buy low when you can buy high like right now, eh...?   Those stupid ancient civilizations and their fascination with assets that retain their value, I tell ya...

Mon, 12/08/2014 - 16:19 | 5529830 Bell's 2 hearted
Bell&#039;s 2 hearted's picture

when being chased by bear ... need to only be faster than slowest person

 

Treasuries will "survive" longer than equity/muni/HY/etc

 

i have zero doubt that the 10yr will hit 1% in the coming recession ... after that?  Don't know, but i'll be long gone from bonds then

Mon, 12/08/2014 - 16:46 | 5529899 Ewtman
Ewtman's picture

In a deflationary environment with huge debt levels that must be destroyed before the economy can begin to repair itself, bond yields of all kinds, from junk to US Treasuries,will rise as their perceived risk increases. Thus, the 10 YR yield will skyrocket in the coming years. 

http://www.globaldeflationnews.com/10-yr-u-s-treasury-index-yieldelliott...

10 YR historical update

http://www.globaldeflationnews.com/10-yr-treasury-index-yieldelliott-wav...

 

The attempt to pay down all that debt will force the dollar upward, a phenomenon which will catch most economists, pundits and analysts completely off guard.

http://www.globaldeflationnews.com/u-s-dollar-indexelliott-wave-historic...

 

 

 

Mon, 12/08/2014 - 16:55 | 5529940 LawsofPhysics
LawsofPhysics's picture

Bullshit.  Unless the liabilities on the U.S. balance sheet are eliminated, rates cannot go up significantly.

 

Fri, 12/19/2014 - 14:31 | 5573338 Livermore Legend
Livermore Legend's picture

"Liability" and "Contingent" are one in the same........

Understand that, and you begin to understand what is really happening........

As I said before, you have a lot of Depth....

But you are Flat Wrong that Rates cannot Rise.......

They CAN and WILL.....

The Real Question is WHEN and HOW......

"HOW" as in "HOW" to take Position to Profit from events.......

"WHEN" as in the "WHEN" Right Party Advances the $ 100 Million they will have the "HOW".......

One of the Most Important Things to ever Learn in Markets is that the Big Money is never Made and KEPT on the Obvious.......

Wasn't it OBVIOUS that Oil would Hit $ 150 ?

You See My Point ?

 

Mon, 12/08/2014 - 15:56 | 5529724 madcows
madcows's picture

bologna!  Bulltard will talk the markets back up.  And, if that doesn't work, the FED will reignite QE-finity.  AND, if that don't work, the FED will call up the EU, and they'll goose this bitch.  And, if the EU don't work, they'll get Japan to print.  And it that don't work, they'll get Brusels to buy some shit.  And, it that don't work, they'll buy every piece of government debt and drop dollars from helicopters.  Pennies from heaven.  money for free.

Mon, 12/08/2014 - 16:04 | 5529766 Bell's 2 hearted
Bell&#039;s 2 hearted's picture

no QE anytime soon ... supply/liquidity issues 

 

blah blah blah

Mon, 12/08/2014 - 16:54 | 5529935 OpenThePodBayDoorHAL
OpenThePodBayDoorHAL's picture

Bingo. You're a doctor whose entire career depended on the efficacy of chemotherapy, massive doses didn't work, the patient's going down. What are you going to do? Why, bigger doses, of course, anyone who thinks otherwise is fooling themselves. Central banks used to rely on credibility, taking away the punchbowl etc but this crowd are true ideologues, real Opus Dei priesthood territory.  Choose one: A. admit that the every one of the intellectual underpinnings of your entire profession are fraudulent and wrong, or B. TURN THE VOLUME UP TO 11! Choice C, admit you are a charlatan that cost $21 trillion in losses, does not even appear on the menu.

Mon, 12/08/2014 - 16:00 | 5529736 yogibear
yogibear's picture

Good old Bulltard does his appearence along with William Dudley (Mr Juice the market) whenever there are storm clouds. Always on queue.

This is not your father's Fed. More akin to the Federal bank of Zimbabwe.

Mon, 12/08/2014 - 20:59 | 5530711 Muppet
Muppet's picture

... don't forget Draghi

Mon, 12/08/2014 - 16:04 | 5529755 Bell's 2 hearted
Bell&#039;s 2 hearted's picture
"Why James Bullard Won't Bail Out The Market's Next Correction"

 

oh, that is easy

 

Bullard has no FOMC vote this year ... or in 2015

Mon, 12/08/2014 - 16:05 | 5529765 lester1
lester1's picture

This entire market is disconnected to reality anyways.. Bullard can fart and the market will think QE4 is coming.

 

We all know QE4 is coming in 2015 because this economy cannot survive without it. This recovery is a big fat lie!

 

 Keep in mind there was a gap of about 6 months between QE2-QE3. I expect the same with QE4.

Mon, 12/08/2014 - 16:26 | 5529855 Id fight Gandhi
Id fight Gandhi's picture

I expect more of th same. They won't even allow a proper correction anymore.

Variable this time around is the crash in commodity prices. They're not getting chased like they were.

Mon, 12/08/2014 - 16:06 | 5529768 giggler321
giggler321's picture

it is rare in panics for people to do something different from the herd.  rarer still someone in finance IMHO.  I guess its like saying when there's a bank run I'm in the queue but only to watch others...

Mon, 12/08/2014 - 16:07 | 5529776 I am Jobe
I am Jobe's picture

Don't be silly. Banks will just loot from back depositors . Problem solved. 

Mon, 12/08/2014 - 16:13 | 5529797 Jayda1850
Jayda1850's picture

Great! So even the BIS is admitting central bankers can manipulate markets greatly just by what verb or adjective they may use and influence market winners and losers at will. Admitted fascism and then it's shrugged off as normalcy. I am actually still young enough to have some idealism left, but everyday I grow a little more bitter when I realize the reverence I once had in justice and our democratic republic, taught to me as a child, is complete bullshit. There are alot of pissed off people waking up to the fact that they have been sold a dream whose purpose is only to enslave them to debt. I only hope their anger is focused on the root causes and not on one another.

Mon, 12/08/2014 - 16:12 | 5529801 Glass Seagull
Glass Seagull's picture

 

 

Bring out the Gimp...

 

where Gimp = Bullard

Mon, 12/08/2014 - 16:17 | 5529825 valley chick
valley chick's picture

Won't even be a 1% correction. *sigh*

Mon, 12/08/2014 - 16:27 | 5529864 SickDollar
SickDollar's picture

The BIS is going to sacrifice a few central banks and the US dollar , but the plan is moving accordingly

 

Mon, 12/08/2014 - 16:38 | 5529895 yogibear
yogibear's picture

Easy guess. 

The Fed will be forced to go onto QE4 

Printing until a currency crisis where their forced by external forces like Russia and China.

Mon, 12/08/2014 - 18:03 | 5529933 netpounder
netpounder's picture

When you play the James character, never go full Bulltard!

https://www.youtube.com/watch?v=X6WHBO_Qc-Q

Mon, 12/08/2014 - 16:54 | 5529936 Madcow
Madcow's picture

From the TBTF perspective, better to just let the economy collpase - so the banks can buy up all the assets again after they've crashed 95%.

Protestors will stop complaining they're all homeless and starving.

Mon, 12/08/2014 - 16:57 | 5529947 James .T .Bond
James .T .Bond's picture

Exactly.

BIS means keep your mouth shut but read my lips.

Mon, 12/08/2014 - 17:37 | 5530056 Chippewa Partners
Chippewa Partners's picture

The American taxpayer will cover Wall Streets derivatives losses.

 

You can put that in stone.

Mon, 12/08/2014 - 18:52 | 5530330 huggy_in_london
huggy_in_london's picture

These guys should stop looking at every fuking tick printing in "markets" and start focusing on the economy....

Mon, 12/08/2014 - 20:41 | 5530644 SweetDoug
SweetDoug's picture

'

'

2nd paragraph, first line… from the mentioned article http://www.bis.org/publ/qtrpdf/r_qt1412_ontherecord.htm

 

"It is too early to say what exactly triggered these sharp, if brief, price swings."

 

Are you @#$%ing kidding? You guys said you were gonna take the punch bowl away!

And now, you didn't see the oil Black Swan coming!

 

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