• Sprott Money
    05/26/2016 - 05:58
    How many “emergency” “secret” meetings do the central planners around the world need to have before the citizens of the respective countries begin to fully understand and take notice that something...

Worst Ever US Trade Deficit Excluding Crude Hints At Upcoming QE4

Tyler Durden's picture


Remember that in a beggar thy neighbor world, where currency warfare has once again broken out between the US, Europe and Japan, for every winner there is a loser. In this case, the loser is the one country that has decided that a strong currency is a great thing for its economy (if only for the time being): that would be the US.

Why is this relevant? Because as the chart below shows, US trade excluding Petroleum, just crashed to $43.7 billion, the worst print in the history of the series, suggesting that portrayals of the US as a resurgent export powerhouse are completely erroneous, and that instead the US is as big a net importer of goods and services (and soon to be oil) as ever.

Biggest ever trade deficit (ex Petroleum)

The crucial point here is that with Shale production now expected to decline (if only modestly: after all those junk bond investors are desperate to keep the MotherFracking dream alive), the US will soon have to import more oil which will require more debt issuance to fund the soaring trade deficit which will require more QE to monetize the deficit.

And thus the stage is set for QE4.

One thing is sure - if the trade deficit surge continues, and Q1 GDP tumbles below 0%, the Fed will be right back at the frontlines, CTRL-Ping the US economy right back into "beggar thy global neighbor" competitiveness. Because as we noted, with Q1 GDP now assured a negative print, and with Q2 GDP according to the Atlanta Fed at 0.8% and likely going lower if there are several "unexpected" spring showers, the US may enter a technical recession as soon as June 30.

Hardly the stuff rate hikes are made of...

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Tue, 05/05/2015 - 09:00 | 6061428 Headbanger
Headbanger's picture

No QE4 for you!

Cause the massive deflationary spiral ahead will slash Federal spending and thus the deficit

So not enough Tresuries issued for collateral for moar QE


Tue, 05/05/2015 - 09:03 | 6061446 MonetaryApostate
MonetaryApostate's picture

QE, Bondy Buying, and Money Printing were historically always precursor to big wars....

(Makes you consider the viability of all the military threats, yeah?)

Makes sense considering the Military Industrial Complex's appetite for destruction & perpetual war..

Anyway, is this all some econcomic war with China by chance?


Tue, 05/05/2015 - 09:10 | 6061455 Headbanger
Headbanger's picture

Well, they could also build taller dams out West with the money

But we already have a shit load of nukes paid off.

So yeah, a big WAR is more cost effective

BTW:  DAX getting clobbered:


Tue, 05/05/2015 - 09:17 | 6061508 Stackers
Stackers's picture

With the EM world facing a dollar shortage this is good ...... right ?

Tue, 05/05/2015 - 09:24 | 6061548 Headbanger
Headbanger's picture

A liquidity crisis will make dollars moar scarce

But demand goes up for other currencies as well

So who knows.

Tue, 05/05/2015 - 09:38 | 6061610 knukles
knukles's picture


Tue, 05/05/2015 - 09:36 | 6061601 Arius.
Arius.'s picture

No rate increase in June ?

Tue, 05/05/2015 - 09:09 | 6061480 Took Red Pill
Took Red Pill's picture

In case you're wondering who is fighting whom;


Long bomb makers like Raytheon and Lockheed Martin 

Tue, 05/05/2015 - 09:13 | 6061491 TheFourthStoog-ing
TheFourthStoog-ing's picture

Zero Hedgers embarrass themselves with all these dumb references to MOAR (whatever the Fock that means) and "keep stack in', bitchez". It's ridiculous.

Tue, 05/05/2015 - 09:18 | 6061518 valley chick
valley chick's picture

8 weeks 2 days...no further comment needed.

Tue, 05/05/2015 - 10:31 | 6061775 Colonel Klink
Colonel Klink's picture

You should have just stopped at "the fourth stooge" for a user name.

Wed, 05/06/2015 - 04:28 | 6064781 williambanzai7
williambanzai7's picture

Go suck Clappers scrotum trollbot.

Tue, 05/05/2015 - 08:56 | 6061431 buzzsaw99
buzzsaw99's picture

nah, they're gonna raise rates soon. i heard it on bubblevision.

Tue, 05/05/2015 - 08:59 | 6061442 VinceFostersGhost
VinceFostersGhost's picture



Oh, you just wait little mister.

Tue, 05/05/2015 - 09:13 | 6061495 buzzsaw99
buzzsaw99's picture

vince, tell me a bedtime story, :)

Tue, 05/05/2015 - 08:56 | 6061433 ZH Snob
ZH Snob's picture

we live by the $, exploit with the $, kill for the $.

it would make sense to print more and more and more.

'cause we got nothing else.

Tue, 05/05/2015 - 09:14 | 6061497 TheFourthStoog-ing
TheFourthStoog-ing's picture

Good grief

Tue, 05/05/2015 - 09:32 | 6061561 ebworthen
ebworthen's picture

Good thing we off shored most of our manufacturing and production of tangible goods and career employment - and import green card and illegal labor, eh?

Why...telemarketing, insurance sales, and burger flipping will save this great nation!  Debt forever!

Notice that the unemployed youth in urban areas are pushed either into the:  military, EBT F.S.A., or the corporate prison system,

Tue, 05/05/2015 - 10:54 | 6061872 Carpenter1
Carpenter1's picture



Once a junkie, always a junkie

Tue, 05/05/2015 - 08:58 | 6061437 valley chick
valley chick's picture

And as I said before..."biggest miss since Lehman" is so 2014. Now to be replaced with "biggest ever" ! 

Tue, 05/05/2015 - 09:01 | 6061448 Achilles Heel
Achilles Heel's picture


Tue, 05/05/2015 - 09:15 | 6061503 SoilMyselfRotten
SoilMyselfRotten's picture

And with biggest ever miss ? Dow 20,000 coming to a theater near you.

Tue, 05/05/2015 - 08:58 | 6061439 Xibalba
Xibalba's picture


Tue, 05/05/2015 - 08:59 | 6061440 wmbz
wmbz's picture

Worst ever!

Which is really means the best ever, because we will get MOAR... forever!

There can't be any problem with that, can there?

Tue, 05/05/2015 - 09:13 | 6061494 venturen
venturen's picture


Tue, 05/05/2015 - 09:23 | 6061539 MonetaryApostate
MonetaryApostate's picture

You guys have the sarcastic humor of lemming mentality & it's fooking hilarious... :D

Tue, 05/05/2015 - 09:03 | 6061441 aliki
aliki's picture

please CNBC ... continue to roll-out these clowns who still believe the first rate hike is coming this year. only been wrong for the last 2-3 years regarding rate hikes, whats another year?

obama-keynsian-economics clearly defining "being in a box" with regards to this interest rate time-bomb they've created. can't wait til the last idiot light on her "dashboard" flashes INFLATION ALERT with regards to wage inflation (which was seen last week). they are running out of excuses although i did see 1 fed clown say they want to UP the inflation TARGETS now. ANYTHING to not HAVE TO raise rates.

oh wait, once the market sniffs out inflation, bonds will sell-off and rates will go-UP in their face. can't fuggin wait for that shit to spray against the wall. this # this morning was a flat-out mess for their "plan".

currency-wars on.

Tue, 05/05/2015 - 09:04 | 6061462 buzzsaw99
buzzsaw99's picture

...once the market sniffs out inflation, bonds will sell-off and rates will go-UP in their face.

denninger? is that you? still waiting for bondzilla to wade into town? lulz.

Tue, 05/05/2015 - 09:14 | 6061499 Headbanger
Headbanger's picture

Moar like bonds get sold off in a panic to cover horrible margin calls when equities implode soon.

Classic liquidity crisis dead ahead!

Tue, 05/05/2015 - 09:19 | 6061519 strangeglove
strangeglove's picture

Relax the FED has our back they will soak up every last pos Bond if they have to. at least in our lifetime and I was born yesterday.

Tue, 05/05/2015 - 09:20 | 6061527 buzzsaw99
buzzsaw99's picture

damn, we're priviledged enough to have karl denniger AND marc faber with us this morning?

Tue, 05/05/2015 - 09:17 | 6061510 aliki
aliki's picture

uh, no. but what i do believe is that these clowns have created stagnation thru their policy of no fiscal policy but hyperbolic monetary policy. printing $$$ while raising taxes across the globe chokes growth and forces $$$ into asset classes it shouldn't be in. you do that long enough, and something has to give. i just hope they can keep it going long enough til i can die first. but hey, if you do believe this course they have us on leads to a happy place, i gotta bridge on the upper east side for a real good price.

Tue, 05/05/2015 - 09:22 | 6061537 buzzsaw99
buzzsaw99's picture

hey guyz, hear that? aliki says buzzsaw99 thinks that current maggot policy leads us to a "happy place". omg lolololol

Tue, 05/05/2015 - 09:29 | 6061571 aliki
aliki's picture


lol. i shud smack myself for discounting ur screenname

Tue, 05/05/2015 - 09:09 | 6061479 ejmoosa
ejmoosa's picture

The others will lower their rates and the US can stay the same and claim a relative rate hike.

Then it will be business as usual.

Tue, 05/05/2015 - 09:08 | 6061456 Dr. Engali
Dr. Engali's picture

Every time I hear "manufacturing is making a comeback in the U.S" I want to fill my Chinese made teevee full of wholes with some good old American made lead. Where is this manufacturing they speak of? Those hollowed out husks of a building lscattered throught the country? Fuck, even if we wanted to manufacture a product, getting past the bureaucracy is a major pain in the ass. We can't get anything moving here without some fucking special interest group fighting it. I don't want that ugly old building in my rotting decaying  backyard, build it some place else. Americans are fucking stupid, and they clearly have a death wish.

Tue, 05/05/2015 - 09:19 | 6061522 Tabarnaque
Tabarnaque's picture

Come on, paper manufacturing is doing extremly well in the USSA.

Tue, 05/05/2015 - 09:20 | 6061526 venturen
venturen's picture

we make some of the best drugs ever developed....get your happy drugs like many of your fellow citizens (and illegals) and you won't care that we are bankrupt! 

Tue, 05/05/2015 - 09:28 | 6061566 TheFourthStoog-ing
TheFourthStoog-ing's picture

Caterpillar, GM, Ford, 3M.

Pull your head out of your ass.

Tue, 05/05/2015 - 09:43 | 6061606 Dr. Engali
Dr. Engali's picture

Why don't you check out Ford's manufacturing plant out in Brazil, or Cat's 59 factories located outside of the U.S and get back with me. Oh, and go fuck yourself.


The future of manufacturing, not in the U.S. :



Tue, 05/05/2015 - 09:03 | 6061458 all in capital
all in capital's picture

how do you get from worst trade deficit to QE4? seems a stretch to me

Tue, 05/05/2015 - 09:08 | 6061475 buzzsaw99
buzzsaw99's picture

maybe someone nice will explain it to you.

Tue, 05/05/2015 - 09:10 | 6061483 Dr. Engali
Dr. Engali's picture

You do know that a "strong dollar" is a strain on exports right?

Tue, 05/05/2015 - 09:20 | 6061529 all in capital
all in capital's picture

I get that a strong $ is a strain for exports but that automatically equates to QE4? the number is 43b in the grand scheme of things that's a pennies on the dollar.



Tue, 05/05/2015 - 09:24 | 6061546 Dr. Engali
Dr. Engali's picture

Multiply that number times 12.

Tue, 05/05/2015 - 09:27 | 6061558 buzzsaw99
buzzsaw99's picture

it is just one piece of the overall mosaic. watch and learn.

Tue, 05/05/2015 - 14:12 | 6062701 monad
monad's picture

Not if you're betting on the yuan.

Tue, 05/05/2015 - 09:05 | 6061465 TheFourthStoog-ing
TheFourthStoog-ing's picture

There's nothing fundamentally wrong with this economy, which is why equities have nowhere to go over the longer term except up.

Tue, 05/05/2015 - 09:17 | 6061509 SoilMyselfRotten
SoilMyselfRotten's picture

You work in a factory that makes rose colored glasses?

Tue, 05/05/2015 - 09:29 | 6061570 i_call_you_my_base
i_call_you_my_base's picture

Yes, if we could just get back to the heyday years of 2006 or 1999 when everything was healthy.

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