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Damn It, Janet - Act Now, Before It Is Too Late!!
Submitted by Sean Corrigan via The Cobden Centre,
Laying The Foundations
As the Yellen Fed inches painfully towards taking its first ‘data-dependent’ steps to raise rates (albeit with the promise that such a process will follow the disastrous, well signposted creep upward which enabled so much damage to be wrought after the Tech Bust), the evidence mounts as to just how belated any such action will be. Take housing, for instance.
Here, the latest release shows that multi-unit starts were the best since 1985 after rising 13.5%YOY to stand 275% off their lows. Adding to the sense of building excess, the ratio of starts for 5+ to single-unit buildings has not been topped since the inflationary peak of 1973. Permits are also robust, rising 30%YOY to hit an 8-year high with the multi-unit variety up +70% to a 25-year high. The ratio to singles was the best since 1986 and thus lay close to a 40-year peak.
Courtesy: Bloomberg
No surprise, perhaps, that real construction spending is up more than 10% in a year to its best level since the GFC. In fact, this measure was only ever higher during the period 1998-2008 which started with the loose policies of the ‘Committee to Save the World’ and ended with the even looser ones of the ‘Committee to Save the World from the Committee to Save the World’!
Courtesy: Bloomberg
Construction accounts for around $1 in every $30 that circulates in the economy and for one job in every eighteen in the private sector so this does help the cyclical upswing. Employment in the sector has expanded at a CAR of 3.7% these past 4 1/2 years versus a CAR of 2.3% for all private jobs. The sum of earned wages are a third higher (at a 6.6% CAR), appreciably better than the one-fifth and 4.4% CAR achieved in general.
Given the irrefutable historical testimony of the disasters which ensue once a construction boom takes full root – and also given both the empirical and Austrian-theoretic conclusion that this is one of the most interest rate sensitive sectors in the economy – can we please act now, before it is too late, Janet?
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It's already too late. Policy acts with a lag. She hasn't started and will move too slow once she does.
We are still scheduled for a crash in Sept.
Don't rush it...
Yes, though in her mind if the market goes 'crashes' by 1% as a result, she will threaten QE4 in her normal, mumbling way.
This stupid delay only makes it much much worse in September
And everybody knows it but it hasn't sunk in yet.
Gold is zig-zagging like an Obama lie detector test
https://www.youtube.com/watch?v=HNLC-b8zWEk
Gold nor PM price breakouts will be televised or visible on any monitor.
Their true worth is now established behind closed doors and metals exchanged in the dark
Mr Yellen ain' got the balls.
Worried about bubbles and economic sustainability??? LOL
Akin to rearranging the deck chairs for optimal seating as the Titanic capsizes
25bps will save the world.
It was too late 22 years ago
Me so horny to help China buy yankee gold for $900.
Sucky sucky you long time.
Are there any black folks on the FOMC?
I doubt it. Probably not even anyone without dual citizenship.
Recovery is just around the corner
Not yet
Government needs to do more
Let's do the Time Warp again
"Janet you ignorant slut..."
https://www.youtube.com/watch?v=k80nW6AOhTs
Classic- thanks for the laugh!!!
7 years too late.
At least the next president will be able to say it's obama's fault for eight years, so we have that to look forward to I guess.
President Trump?
Or Tramp.
Perfect Time To Destroy Capitalism
Perfect time for the left to allow interest rates to rise, so they can wait for the inevitable reset, and then proclaim…..wait for it……”See we told you capitalism didn’t work, the little guy is getting crushed!!! Bad capitalists. Bad. ” That’s my prediction, July 29, 2015.
Then the communist Bernie Sanders wins the election. Or whatever Democrat is in the lead. All they have to do is repeat the lie: “Raising interest rates ’caused’ the economy to collapse, the mean conservatives knew this all along.” Yes we do.
http://www.righttalkwisconsin.com/politics/feds-interest-rate-rise-will-...
It's already too late. See the two charts in the link below:
http://ejmoosa.com/blog3/2015/07/29/this-time-it-is-going-to-be-very-dif...
http://ejmoosa.com/blog3/wp-content/uploads/2015/07/Business-Profits-aft...
http://ejmoosa.com/blog3/wp-content/uploads/2015/07/Dow-30-Profits-Analy...
So I have to share this with yall.
My GF does work with IBM Watson and she sent me this "Personality Insights" thing where you put in text for Watson to analyze.
I input the press release from the FOMC meeting and among other things Watson said:
"you have a wild imagination. "
Yep, Watson, you're not wrong.
Can you provide evidence?
forgot link
https://watson-pi-demo.mybluemix.net/
Just hop on over to federalreserve.org and copy paste. Watson is my new reading companion. Most of the time its purely anectodal but its fun anyway.
Did you mean federalreserve.gov?
yes thank you for correction.
Should probably be changed to federalreserve.corp
It looks like no one has registered federalreserve.sucks yet. Anyone here care to do that?
the rates are never getting raised. low rates and free money for wall street is the only thing keeping this house of cards standing
A new hit series on NBC this fall, "Damn It Janet!", about an elderly lady who wakes up one day to find that she lays golden eggs, discovered when her adopted grandson "Goldman" takes one to school for show and tell, and then hilarity ensues!
Are you talking about these golden beauties?
https://en.wikipedia.org/wiki/Ben_Wa_balls
What part about can't raise rates do these retards not understand? We are in a depression, there are $750 trillion dollars worth of derivatives out there, roughly 10% of tax revenue goes towards servicing existing debt (not to mention private debt levels), and that doesn't even begin to take into consideration the trillions in unfunded liabilities the eCONomy sucks and the work force participation rates are at historic lows. We have been way past to late looooong ago. You can take your "analysis" and shove it.
^^^^PREACH IT DR. E!!!!
Hell Doc, don't hold back, tell us how you really feel!!!
Agree with all of what you said. The only issue is that leaving rates at these levels will push asset prices much, much further into the mega bubble zone and, given that we have 2 recent examples of how well that ends, if she has any brains at all, she has to lean into a continued spiking in asset prices. Plus, a couple 25bp moves may help smoke out the degree of derivatives and leverage in the system As of now, they have no idea how levered the world is after 7 years of ZIRP.
Low rates push asset prices down over time on account of stimulating the creation of over-supply of assets. After, of course, a period of higher asset prices. Ironically, higher rates may actually restore asset prices and stability.
Japan is the model. Simple as that. They've been playing this game for a long, long time. Get used to it.
Japan is at least productive, despite their almost complete lack of natural resources. America is extremely unproductive, but has the natural resource endowment.
I'm not convinced the outcomes will be identical though.
07/29: Denver could be largest US city to end fluoridation of public water as activists force debate
It will never happen. Flouride is too damn harmful to people. It's essential to dumb down the population and for the sheeplization of AmeriKa. The elites will never let it happen.
By the way -is there flouride in beer? I don't drink flouridated water, but if it's in beer, I'm screwed. No wonder I feel so lethargic and bad lately. I bet there's fouridated water in my beer.
Most of the rural South is on well water. Most of the rural South does not trust the government. Coincidence?
As others have pointed out, we're already well past "too late". In any case, this still looks like the Fed having its cake (saying they're going to raise interest rates) and eating it too (continued zero rates). And we all know Janet really likes her cake.
How many summers of Recovery are we on now ? And what year in the future is far enough away to call the present Time THE GREATEST DEPRESSION.
rates go up, USD rockets
figure that one out yellen you fucking satanic cunt!!!
Nope. Rates go up, the USD$ drops. On accoount of a recognition of higher inflation coming, and increasing consumer demand for imported goods.
People tend to get it all backwards. Higher rates are decidedly bad for a currency unless they act to prick an internal bubble.
impressive - you must work for CNBC.
yeah - the middle class should have to pay MOAR to banks in interest to buy a house.
dick.
off topic:
VIDEO: Crowd Becomes Angry as They Watch Swarms of Cops Jump on One Man in a Target Store
http://www.alternet.org/news-amp-politics/video-crowd-becomes-angry-they...
cops continue to act like they're above the law, not without reason.
The article presupposes that the fed exists to benefit, the mass shleppers on the street. When in fact it is only there to steal, pillage and destroy.
J.Yell is looking more and more like the perfect patsy if there's a crash.
BIS really have been very clear that they want rates to rise:
https://www.bis.org/speeches/sp150628.htm
h/t Atomizer
Damn it Janet, I love you.
https://www.youtube.com/watch?v=ZbpJb7hjb7M
The economy is clearly decelerating, and rates probably are actually too high at this point relative to the economy's strength. The real tragedy of the Fed is actually claiming that rates are going to rise when there is no inflation, and no significant returns to investors outside of fixed income that would justify such. The tech and housing bubbles will implode on their own over time, as will the bond bubble.
How is there building excess when rents are skyrocketing? This is the market playing catchup for 5 years of lagging behind par.
It works if you look at in a mirror.
It's all bullshit.
By the time interest rates are actually going up, the markets had all the time to readjust. There is no secret in the FED message, rates are going up by the end of the year UNLESS something major happens IN THE US. So China woes, Greece2 and so on are not taken into consideration.
And it won't be too late. Eiher September of December does not matter. Whoever was around at the time of the subprime disaster can see clear differences between then and now. Markets are overvalued? They will readjust. Trillions of debt? Dollar devaluates.
There will be a shift, but as long as people understands where the money is going to go and can follow it, it won't be a problem - because it will not be a surprise.
The economy simply isn't strong enough, nor will it be strong enough by the end of the year to justify a rate hike. Nor does any inflation exist. Deflation seems to be the larger problem.
The Fed "message" is that they're a long ways from acting, especially since the weak labour market was cited. Unemployment is well into the double digits if calculated on a rational basis. The only justification in the data is for further stimulus, not rate hikes which would be a sort of economic genocide.
"Damn It, Janet - Act Now, Before It Is Too Late"!!
WTF! I do live on a different planet!
The S.S. "Too Late" sailed a long time ago, please try and keep up! This bitch has a giant iceburg coming it's way!
Just like some folks think the next elections will make some sort of difference!
We passed the point of no return a long time ago. "Before it's too late" has disappeared in our rearview mirror.
We all WISH it was too late for them. But somehow the Fed and the US Oligarchs keep chugging along.
The bullshit has been going on forever. Wall Street is scared to death about having to pay interest on the money they are borrowing for almost nothing and used to speculate and create one bubble after another. We are already to the point where even at FED zero interest rates the economy cannot grow enough to pay the low interest rates for the outstanding debt. Soon the Fed will need to go back and print even more money to keep going. They have been bluffing up to now, but they will have to show the cards soon or later and it will show that they do not have anything left.
Higher rates compress "Wall Streets'" spread. Wall Street basically can't survive in a rising rate environment.
FUCK YOU BIYATCH!!!!!!!!!!!!!!!!!!!!!
It's been too late since January 20, 2009.