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The "Bullard Put" Is Gone: "It Is Reasonable To Hike Rates In June Or July"
Having explained last month why he would not bail out the stock market again, (non-voting) Fed member Jim Bullard trotted out the usual vicissitudes this morning on Bloomberg TV trying to sound as upbeat and positive as possible: ECB QE is good for the US economy, low oil prices "unambiguously positive" for US, and ses unemployment below 5% in Q3. But then he unleashed the awful truth:
- *BULLARD SAYS HE'D LIKE TO GET OFF ZERO RATE SOONER, REASONABLE TO EXPECT RATE RISE JUNE OR JULY
Warning that "waiting to raise rates, risks falling behind the curve," which sent Treasury yields lower and stocks into a confused frenzy of "what did he say?" as they realize that the upbeat talk is just talk and The Fed will raise rates no matter - as we noted yesterday - it's the lesser of two evils.
- *BULLARD SAYS MARKETS TOO DOVISH ON FED RATE OUTLOOK (so sell bonds and buy stocks)
- *BULLARD SAYS ECB QE DRIVING DOWN INTEREST RATES IN U.S. (nothing to do with shitty underlying growth in US)
- *BULLARD SEES UNEMPLOYMENT BELOW 5% IN THIRD QUARTER (while the labor force collapses)
And then...
- *BULLARD SAYS IT'S REASONABLE TO EXPECT RATE RISE JUNE OR JULY (wait what!!)
- *BULLARD SAYS ZERO INTEREST RATE NOT RIGHT FOR THIS ECONOMY (but what about my stocks!)
- *BULLARD: WAITING TO RAISE RATES RISKS FALLING BEHIND CURVE (nooo!)
He also seemed to dismiss Yellen's "transitory" comments on Oil:
- *BULLARD SAYS OIL PRICE DECLINE APPEARS VERY PERSISTENT
And then really put his foot in it by admitting that "if TIPS don't improve [he] would be concerned that [Fed] credibility was eroding"
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.... Or you could watch Chris Christie fall on his fat ass for some giggles:
http://wingbowl.cbslocal.com/2015/01/30/wing-bowl-exclusive-cataldi-rele...
Whoops, the steamroller just sped up.
<Just one more dime, just one mo......>
And now the s&p is partying like it' 1999
*BULLARD SAYS IT'S REASONABLE TO EXPECT RATE RISE JUNE OR JULY
And the market is calling BullSh*t on you Bullard:
10-Year Yield = 1.67%
30-Year Yield = 2.25% (All time Record Low)
We are ALL Japan now...
.50 1 year
1.00 10 year
1.50 30 year
nice and linear
THe most important year is 2015 because it isn't an election year and they want to do it ASAP before 2016.
Just go back and look at all of the markets during the political cycles, that will tell you which way to bet, seriously.
Did Mr. Bullard mention which year he was talking about in reference to June or July?
That's hilarious.
F'n clown Bullard is so full of shit.
Reminds me of Barney Frank in summer of 2008..."everything is fine." Then we were fucked. The lies these people tell wrecks so many lives and yet they believe they are doing the right thing!
Awesome! Couldn't happen to a better turd.
Raise rates indeed. Please, if they do it will be 5 basis points and they will declare "victory" all the while still giving themselves access to money at rates that no one else can get.
All this time we thought the Fed was painting itself into a corner, when in reality they have painted every other CB in the world into one tiny corner. Now they can raise rates, and when shit goes to pot, they have numerous scapegoats: the SNB, the ECB, and the Danes, just to name a few. Conversely, if they do not raise rates and are unable to act during the next downturn, they still have their scapegoats: "The US was doing great until they fucked everything up."
And then they will cut by 25 basis points at the very next meeting after a crash that will make the "Taper Tantrum" look like a bull market...
If stock buy backs have been as great a component of the S&P during QE as I've read, would that not slow the velocity of a downturn? It would seem there's a group of market participants with absolutely no desire or need to liquidate there positions. Could we see a levitating market for a "considerable peeiod"? I think residential RE is the next shoe to drop and lower housing costs for consumers could help the retail side of the S&P right?
Plus lower interest rates on mortgages will put moar money in people's pockets. I think you're on to something.
Either that, or ON something *smile*
We've already got the low rates. I'm talking about these bubbleicious prices and rents going back to a semi-sane percentage of income. When the air leaves Housing Bubble 2.0 the consumer gets a raise so to speak.
The problem will likely ultimately come from the decentrilization of Europe (end of Euro) which will mess up the best laid CB plans to keep this ponzi going. In the meantime you can bet that .gov will pull out every rabbit in the hat (including trying to force the hand of the rest of the world) to ensure this party keeps going at least past the next election.
They seemed okay letting it crash before the 2008 election... I'm of the mind that this is not going to be a symettrical downturn. There trying to engineer a "soft landing" by changing the trjectory of the impact. Instead of straight down and SPLAT, they go for the rock skipping down the hill. First skip was the energy market pop, next skip pop Housing Bubble 2.0, next skip maybe a bond market event. I think they're trying to save the S&P for last. They hope that with the "positive" deflation in other areas boosting consumer spending they can keep the markets flat or marginally down while everything else is priced to reality.
"Dual mandate."
Sound money will improve hiring...increase growth...maybe save the bankrupt Government and all their pensions.
MAYBE.
i still dont see how the fed can raise rates. not when they are printing money because the spx drops 30% all the way to 1500, where stocks will only be overvalued by 50%......
WOW they're really wearing out this good cop-bad cop routine now with hourly conflicting statements.
Keep them spinning bro while your accomplice picks their pocket.
<Or is it the other way around?>
.0001 rate increase, wow can't wait
Fed credibility stick-saved! YAY!
not only will they not raise rates, 0% is coming. you know how you have 0% loans on new cars? same is coming for everything else.
Is this the classic double bluff? No wait, tripple bluff?
Aaah screw it...
Seems they've just settled on 'baffle em with bullshit' from here on out.
Need we endure further meaningless word games out of those asshats? There will be no more rate hikes on through the demise of our civilization, fed bullshit notwithstanding
Got tired of being the Fed's donkey, henceforth will be the Fed's burro.
These Fed morons still don't see .... or won't admit to seeing ..... the wreckage to come in the energy financing sector. HINT : Not transitory !
HORSESHIT
The fed's main job besides counterfeiting is to continue to keep everyone confused. Bulltard is no different.
Must be awesome (and profitable to some) to have so many mouthpieces from such a powerful organization. They get to make overly qualified, vague, mealy mouthed prognostications / thoughts / concerns / possibilities / plans in one direction, then the next, then back again.
How long til Bullard meets with Dem's to tell them he didn't really mean it.
At the end of the day, the only consideration is this- the Fed simply does not want the next recession to start with policy still at the zero bound, and it has nothing to do with theory. The worry is simply this- if the next recession starts with ZIRP already in place, then the entire intellectual facade of ZIRP as a policy collapses. After all, how could a recession start with zero interest rates?
+100. Its all about trying to maintain what little credibility is left so that extend and pretend can go on alittle longer.
next recession? They are presently lying about this "recession" and will lie about the -alleged next-. P/e to the moon.
Raise rates to exacerbate the popping of Housing Bubble 2.0. Combine that with lower gas costs and you give consumers a "wage increase" if you get them spending, and consumer confidence is up already, those PE ratios comedown and stocks are "cheap" when every specuvestor is running for the exits from RE and energy?
Mid 1990s scenario matching the beginning that stock bull run. I've been thinking it's their plan.
ask the FED: Are you going to raise interest rates soon or are you keeping them at zirp?: the Fed smiles, takes a long hit off it's hookah, coils it's tail and answers: YES.
I hate cheshire cats. they always lie.
After all, how could a recession start with zero interest rates?
Did we actually ever get out of the last one?
The "Bullard Put" Is Gone: "It Is Reasonable To Hike Rates In June Or July"
Which is codespeak for....
You the American people will either be starting a war or in a war by June or July of this year... Which means you will be seeing another catastrophic attack somewhere in North America or Europe in 5... 4... 3... 2... 1...
Aren't rates usually raised to slow down an over-heated economy?
Cool, didn't realize we were in such a state.
"Who are these guys?"
Dumb and dumber.
if june or july I would expect significant inflation by sept
These idiots, including Yellen, should not be allowed to speak in public...ever. Transparency is not raising confidence at all.
"It Is Reasonable To Hike Rates In June Or July"
Of what year?
it's a seasonal policy. don't you know?
2050 I'm thinking is their target year.
HIKE THE RATE you fucking liar. You know you're painted in the corner. Each and every one of you feral Federal Reserve central bankers should be tried, found guilty, and hung for treason and theft.
Bullard is certainly following the Mad Hatter's lead..
Look at how well believing your own lies has worked out for the Bank of England's Chairman?...
When you know you have surpassed "full nutter" status and nobody with common sense and courage challenges you directly this is what happens to an economy!
What does it matter what Bullard says - or even what the Fed ends up doing? At this terminal stage, what matters is what nations outside U.S. borders end up doing. And hopefully - for everyone's sake, they double their existing efforts.
Grandma just soiled her pantaloons...
Bullard put? The fuck you guys talking about? He's been calling for raising rates since 2010...
Get with the fucking program...
BTFD ?
"We will hike rates by -0.10%, yes".
Bulltard
I dare you , you stupid fucker, go ahead !
I don't know what you take me as or understand the intelligence that Draghi has. I'm from rich to richer, banker, I ain't dumb. I got 99 problems but a mortgage ain't one.
Re.Bullard, set in context:
We're seeing a rotational jawboning clown show. Remember a few years ago when Saint Louis Fed's Kocherlakota was considered the major dove? That sure changed.