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It's Not The Economy, Stupid, It's The Flow
By now it should be clear, without the flow of Federal Reserve funny money, the wedge between the reality of collapsing macro- and micro-fundamentals and ever-expanding valuation hope-based stock prices is bound to close... and that is why the following 2 charts must be scary for Janet (and every asset-gathering commission-taking talking head out there).
The Wedge: (the Fed-engineered gap between reality and unicorns)
And the flow: (the rate of change of The Fed balance sheet - as opposed to the level or 'stock' of The Fed balance sheet - is what matters after all, via NJC)
So once again we'll ask, as we have ever since 2014: is the Fed simply rising rates just so it badly crashes the economy and has the cover to launch QE4, the same way Russian sanctions crippled Germany's economy and led to the ECB's very first episode of bond monetization?
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Say it ain't so!
THis Flo?
http://rule34-data-000.paheal.net/_images/acdf17f651b5284c095c4c7bafc2de...
Is it real, or is it memorex?
(like the smirk, either way)
more helicopter money... yippee... go Janet...
It would be nice if the chopper would shower me with cash, instead of the banksters and corporate elites.
There ya go!
Feral Reserve balance sheet is shrinking fast so they got to raise rates very soon.
1. The FED doesn't want to do QE anymore, it's caused all the deflation they wanted (yes, I know that's the opposite of the stated aim).
2. Sanctions crippled Germany's economy? Really?
3. Q€ is about continuing the global QE sequence (like BOJ picking up as soon as QE3 was tapered) and making good on promises (and its intentionally flawed design will lead to its premature end, placating the Bundesbank).
Cripple is strong, but " About 6,300 German companies, or 10 percent of exporters from Germany, have sales to Russia."
http://uk.reuters.com/article/2014/08/03/uk-ukraine-crisis-germany-economy-idUKKBN0G30CL20140803
So what? Just look at the export numbers.
I agree. Everyone was on the lookout for inflation (if not the start of hyper~) , few realised that the QE kept so many otherwise insolvent 3rd world industrials alive that overcapacity and overproduction caused deflation
i wasnt alone being late to the party on that dynamic
If it hadn't been for the Bullard October freak out the discrepancy would have been far less pronounced.
QE is not helicopter money.
Central banks like the FED do SWAPS. A double entry ledger needs something on the other side to make new credit.
This is undeniable ledger mechanics.
QE is a swap of FED keyboard money for a debt instrument or whatever else the FED TARGETS. They have targeted bonds and MBS, and in both cases those 'financial asset' are propped up in price.
A helicopter drop is direct injection into producing part of the economy. This can be done these ways:
1) Government issues new TBills, and they are monetized eventually by the FED. Government now has new "cash" in hand, and then injects into the economy.
2) Money system changes and now debt free money is made available (not likely).
3) The law is changed, thus allowing the FED to convert from being a Central Bank and becoming a National Bank. Perhaps the FED's shares are held in trust at Treasury, similar to what the Bank of Canada did in 1938.
Of course, the best option is to change the nature of money from being based on debts to actually being wealth and controlled by law, and as most by now should know, that is a sovereign money system.
A true helicopter drop has not been done. It would pay off private debts, and that is something debt spreading private bankers do not want.
If FRN's are an extention of credit (IOU's), and Credit isn't counted as taxible income why are people paying inome taxes if all they have recieved are FRN's?
so the fed collects income on said purchaces?, but if the price of the assets is worth alot less does that weigh on the real or preceived value of the currency?
Can you explain the difference between stock and flow and why its critical?
If the Feds crash the economy, my opinion is it is not to bring about more QE, but to bring about a new system that is waiting in the wings.
Much like I remember how my grandfather who went through the prior Depression in the 1930's, and was even a hobo for a couple of years with some very interesting stories to tell, had a high regard for FDR for he felt he got him and everyone else out of the Depression.
Are you saying Barack H.Obo has a plan ? Doubt it.
Unless it's to make us all hobo's. I might consider taking that train on the return trip to mexico, at least they have nice beaches.
It is the flow. Yes. The flow drives the economy. What drives the flow? It's not interest rates. It's not what you think. It is TIME, in fact. Time IS creative energy, which builds the world for 18 years and then vanishes for 18 years.
http://econintersect.com/b2evolution/blog2.php/2015/06/04/interest-rates...