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Illiquid Markets Turmoil After Hotter-Than-Expected Inflation Print
On a turbo-charged illiquid day ahead of the Memorial Day weekend, stocks, bonds, USD, and commodities are turmoiling after this morning's hotter-than-expected CPI print. Stocks and Bonds were instantly sold (hawkish-er signal), the USD soared (hawkish-er signal) and crude, copper, and precious metals tumbled. Fundamentally speaking of course the US Open is soon and so the algos will, we are sure, rescue one of these (or will they)... and then there's Yellen at 1ET.
Charts: Bloomberg
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The Feral Reserve has GOT to raise rates now one way or another
It should have raised rates and broke up the banks years ago to stop the bullshit, but they are part of the criminal gang
Raise interest on how many trillions?
Hold on, let me find my check book.
It's also in a painted-into-corner HeadBanger, it can't raise rates and yet it must.
DavidC
Yep.. Funny how this feels like the last few days before a massive comet hits Earth.
Someone should make banker / speculator proof umbrellas for when they finally do.
Nope Headbanger. No rate hike soon, if they did the end of the USD will come very quick. The FRB is in a room and the walls are closing in.
Couldn't happen to a nicer bunch of folks. /s
They have to and yet they can't
But they will
Cause the Fed balance sheet has to shrink due to all the maturing Treasuries bought for QE 1,2,3 and fewer of them issued now.
That plus the ass hats in DC will be on a witch hunt soon demanding an audit of the Fed so it's time to clean up that bloated balance sheet fast.
The fact is, the Fed NEEDS a lot moar cash in member banks now and less going into the stock markets cause bank runs are about to happen
So raise rates, crash the market that puts cash back into the banks
The FRB is buying treasuries at almost 10-11 billion a day right now. Should I call that QE ? They are also still buying mortgages at 3 billion a day. If they raise rates they are stuck with shit paper, and big banks go bust and forward UST swaps fail. In other words they kill their member banks. Check your VGC.
The FRB will be a thing of the past long before an honest audit. The ESF trades there too, no one can touch the ESF but the Pres. Puppet himself.
It's some six months from now things get tight for the Fed so they have to act now.
And expect CONgress to enact moar "austerity" measures to reduce Federal deficit spending
Which means less Treasuries issued.
You forgot the part " And they all lived happily after"
Not when their plan is to crash Americas economy.
If you ever needed a reason to believe that the perceptions of events' effect on Fed policy drives markets: Precious metals tumbled on a hotter-than-expected inflation print.
Gold tumbled because it's a sucker's bet.
Happy Memorial Day, sucker!
Options expiry next Tuesday
Gold tumbled because it's a sucker's bet.
So what did you spend all your Zimbabwe cash on?
Gold didn't tumble on me. I bought it at $273.
I don't remember seeing you there.
It's not a bet dumbass, it's an insurance policy.
Gold's going to go through the ROOF, Zeroes!
Cancel all your Memorial Day plans, get in the bunker and start monitoring the trusty shortwave radio.
I am shocked!... SHOCKED!!! that "they" would slam the price of Gold at 8:30am on a weekday. That just NEVER happens.
Does it?
The Boyz are giving all the world's gold to China at the lowest possible prices for some reason. Figure out why, and invest accordingly.
It's a big conspiracy, huh? :-)
On crude we have a gap fill needed at $59 again. But now we have a gap fill needed around 60.70. So think of price currently in space between 2 gap fills needed with one being the moon and other earth. Yep thats the crude market in this age.
Well there is a war going on in the south china sea so that could elevate prices for a while.
There is always that. Now we have mid level pawns like soros publicly beating the war drums. If there is another world war it will be fought on American soil.
So health care, Housing and rents are are up year over year. Why is there only a 0.3% increase?
Because .gov calculates CPI based on the cost of a 10 lb bag of 8d nails, a hammer, a fountain pen, a top hat, and a Ladies girdle from the 1902 Sears & Roebuck Catalog (and they'll consult it next year too):
http://www.searscatalogsonline.com/1902-edition-of-the-sears-roebuck-catalogue/
Throw an ipad into the mix - as long as the numbers come out right.
Like the 93 million out of the labor force Americans don't count towards unemployment, the 7%-10% yearly increases in healthcare costs won't count toward inflation (nor will rent, utilities, food, beef, etc.).
"All is well" will continue as long as banks can rig rates and manipulate currencies with no jail time or revocation of their license to steal - while the insurance companies and the affiliated leeches and tapeworms down the chain of sickcare bleed the sheeple.
For you guys that love electronics visit this site http://best-electronic-products.4mytop.com/ it has a lot of discount products
For those of you wanting to go insane, see the above link.
Must break $1200. Must break $17. Then go to parade. Wave a flag. And eat a hot dog (kosher of course).
owning gold or silver makes you a terrorist.
Good is bad.
Up is down.
To Yellen and her confreres, this morning's action must sound like the slide on a bankers pump action shotgun.
So we have inflation with no growth....hello 1979!
Treasuries are weird because the greater the supply the greater the demand.
For example look at Bunds or JGB's.
They have absolutely worthless fiat monies yet their interest rates are far lower than American ones...
I would really appreciate some input on this:
My probably flawed understanding is that a higher CPI means we have more inflation. If there is more inflation, I. E. less buying power for a dollar, why did the dollar go up and metals go down? Why didn't this lead to a dollar sell off and a PM run?
Tentative: CPI is local, Dollar is global against other currencies. Short term, the power of the dollar in FX trumps PM as some sell a bit to ride the dollar rise. CPI seems kind of irrelevant against global, but does indicate inflation on local goods. Maybe a Lexus is a tad cheaper, if you cash some gold to buy it?
But, who am I to second guess the daily fix.
Thank you for your reply