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This Wasn't Supposed To Happen: Crashing Inflation Expectations Suggest Imminent Launch Of QE4
The wind up for the most telegraphed rate hike in history was supposed to achieve one thing: generate benign inflation in the form of a rising short end and a broadly steeper yield curve, or in short: boost inflation expectations without crashing the market (recall after 7 years of ZIRP and QE all the media is blasting is that "rate hikes are good for stocks") - after all why else would the Fed be hiking rates if not to offset the market's inflationary expectations and to have "dry policy powder" ahead of the next recession, even if said powder was a meager 25 basis points.
It was most certainly not supposed to achieve this:
This is how Nomura summarizes the chart above:
"with deflation fears in the air and oil getting floored, inflation products have already become an unloved asset class. If the Fed surprises the market with a September hike, we expect all BEIs to fall under pressure but likely led by the <5yr sector as risk markets also crater. Just like currently, BEIs are held hostage to commodities and credit markets even as the Fed probabilities are being revised down."
Here is a better way of summarizing it: the last three times inflation expectations tumbled this low, the Fed was about to launch QE1, QE2, Operation Twist and QE3.
And the Fed is now expected to hike rates in less than a month even as inflation expectations are the lowest since Lehman?
Good luck. The Fed - which is damned if it hikes rates (and crushes financial conditions by tightening, sending deflationary signals surging even higher and undoing 7 years of stock market levitation), and damned if it launches QE4 (as it loses all verbal jawboning credibility it worked so hard to establish in the past year ) - is now truly boxed in.
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Listen Jim I'd do really well on a cool Million and not for just a week either. Pay off my bills, buy the property next door and set up a woodshop so I can make furniture. As for the tattoo why the fuck not? For a million I could stand it.
This isn't a fantasy and I'm not afraid of the devil like you might be.
When your furniture business dries up, you can make pine boxes.
Hey listen recently I made a fantastic coffin for a performance of "Julius Caesar". Then get this I had a museum curator who watched the play come up to me after the performance and say my coffin would have look perfectly at place in a museum of antiquities.
So yeah I can make coffins. I made a coffin fit for Julius Caesar. Pine boxes I can do.
You would honestly sell your integrity for a lousy million bucks? Money that will probably rapidly depreciate anyway? Have you no pride in yourself?
If those are my only choices, then I guess I don't!
Maybe it's a cat thing.
On the subject of pride, people tell me I'm an awesome coffin maker. $30K seed money and I could seriously be in the business. There are a lot of rich bankers need proper coffins is how I see it, and from the looks of their situation they are most of them about to die, too. Huge market potential here. At just $5K a box I could make some serious profit and if they want gold leaf (of course they will) I can charge them $10K large. Not bad coin and me being just a dumb animal.
Well not too dumb I guess, a lot of cougar would just eat the stupid prick no pine box required. But there is no actual money in that see. People pay to get themselves buried, and I can buy a big horse or several with the cash, and after they bury that guy I eat anyway. I don't know why one of us didn't think of this before. We're driven by our stomachs most of the time, I suppose is why.
Who said anything about integrity?
...and while we're at it, who the fuck is "leading" the world?
Honest, trustworthy people who ARE fucking evil.
yeah.....integrity .....please.
Who said anything about integrity?
...and while we're at it, who the fuck is "leading" the world?
Honest, trustworthy people who ARE fucking evil.
yeah.....integrity .....please.
The Fed will do nothing until everyone on both sides of the aisles are on their knees.
https://www.youtube.com/watch?v=yeVx1C73o8k
I'd rather the crash happen now while I can still run a sub 7 minute mile.
Lol!
zhers knew that QE4 was coming two years ago
Exactly why it won't happen...yet.
sub 7 minute mile eh? wait until you're my age and a 10 minute mile seems good. either one is fast enough to outrun zombies because they are slower than shit.
Nah, I'm just worried about the young fatties. They can still move.
yeah, they can, over short distances.
So I guess according to the charts... the Fed just have to keep printing and all will be well. Ho hum... off to my yoga class I go.... Thanks Paul Krugman !
of course.. if there are no jobs, no income, the prices must come down.... where is my helicopter money,
FED is just shit, always was, always will be.
People need to overthrow it.
does it matter at this point?
it's already out in the wild that QE in all it's various forms was an abject and epic fail. it would seem to me that despite a few mindless idiots screaming for more printing, the system at large has become immune to hopeium. kind of the same way aids meds eventually fail to keep viral loads down only in this case crushing debt is the contagion. injecting more monopoly money into the markets as a clear and obvious desperate prop whilst creating even higher debt loads comes of as both anti-climatic and pointless.
I could be wrong but I don't see how a new round of QE will re-instill anything near a sense of confidence in the power and omnipotence of central banks the world over.
the markets are broken beyond salvaging in their current incarnation, the entire globalized economy is finally being exposed as completely unsustainable.
the CB's levitated and propped just long enough to transfer a lot of wealth to a select few but inevitably economic gravity always wins. the great reset is upon us.
and it's not the impending collapse I'm most worried about surviving, it's the war that will follow that scares me the most.
I think the markets have lost confidence in QE but not in the idea that the Fed can manage the economy, they just need to present any crisis as a new problem with a new solution. The sheeple will suck it up for at least six months.
Feds, backed into a corner, no way out.
I fear the Federation is nearing collapse.
At least we wont have to listen to the polticians spewing BS about balancing the budget anymore.
Let's try and inject more liquidity into the top. It's worked so tremendously well so far. Perhaps they're only looking for inflation for yachts and blow.
Long farms, tents, and campgrounds.
In the next QE round the Fed should just buy up every debt asset imaginable. Treasuries, mortgages, student loans, car loans, and anything else that is available on the secondary market.
Listen everyone, no one in the fed will do a GD thing now without the world being scared to shit. No one will say anything, no one will do anything, not one thing will happen. Those fuckers are positioned to profit heavily on the trip down and they will gladly step in to "save the world" again once the world begs for forgiveness and gives up every single bit of liberty left.
These financiers are power and money hungry sociopaths. Thats it.
They are going to let it crash this time. They are out of bullets. It is fiscal problem now rather than a monetary one.
Correction: Ben Bernanke was about to launch QE1, QE2, operation twist and QE3.
This time we have yellow Yellen.
damned if it hikes rates; damned if it launches QE4
Surely the verdict is in. It is a sole creature of the damned; it creates a world of make believe where its owners enrich their friends and punish their enemies - and destroy the greatest economic engine the world has ever created. How dare the financial press warn against “hiking too soon” following years of disastrous negative rates? How dare the financial press give credence to this parliament of thieves? They have outlived their time on this earth and unless they are destroyed America will not survive.
The Fed bankers are stealing the means of production with money created out of nothing competing for the private ownership of the means of production created out of labor and earned savings.
This is tyranny – the replacement of the American free enterprise system. This is enslavement of a once free people; this is the seizure of private property.
John T. Flynn’s purpose for writing in 1944 As We Go Marching was to define the meaning of fascism and “then to search for its elements in America.”
Flynn used fascism in defining what was happening in Germany and Italy at the time and suggested that trends in America, a kind of “good fascism,” would eventually lead to the kind of imperialism and totalitarianism found in the Axis powers.
Flynn accuses the New Deal planners of creating a society in which the government would insert itself into the structure of business, not merely as a policeman, but as partner, collaborator and banker. The planners would come up with “an economy supported by the great streams of debts and an economy under complete control, with nearly all the planning agencies functioning with almost totalitarian power under a vast bureaucracy.”
Fed intervention, partnered with a banker-purchased Congress/President/Supreme Court, has taken its final ambitious step: the takeover of an honest market system represented by the equity exchanges.
Jan and Stan are not your friends; they represent the international corporate bankers in their final grab for America.
Thinking the fed is out of bullets is preposterous. They do QE4 and you'll see the entire worldwide markets go up, oil and commodities go up....which will help many countries that are near default, and most importantly, you'll see every bull back in town in us markets as NIGGER JEW AMERICA RULEZ!!!!!!
You're bogarting the bong, Chad.
G. Edward Griffin-Hyperinflation Going to Happen in US | Greg Hunter video
Published on Jun 21, 2015:
"What will the next financial calamity look like to the man on the street? G. Edward Griffin, author of “The Creature from Jekyll Island,” explains, “The main mechanism that people will feel most directly will be the loss of value or purchasing power for their currency. The dollar will buy less and less and less as it has been doing, but it’s been sort of gradual and we get used to it. . . . When you look at the real cost of living, inflation is really pretty high now, but you haven’t seen anything yet compared to when the rest of the world does what it is now saying it is going to do. They are going to stop using the Federal Reserve Note as the international reserve currency. When they stop that, then we have no place to get rid of all these extra dollars we make up in the digital printing press. . . . When that stops, all those trillions and trillions of dollars that we have put overseas will come back to us because the people who hold them, like China for example, will say we can’t use these. Then they will use them to buy up anything they can here. They’ll buy our products . . . but they’ll also buy up our stocks and bonds and real estate. They’ll buy up our politicians or anything else that is for sale to get rid of those dollars as quickly as possible. When that happens all of these dollars will be flooding through our economy. You could say the price of a loaf of bread will be $100, and that is the kind of thing we will see and it maybe even worse. It will be just like we saw in Zimbabwe or Germany in the Weimar Republic. These things happen in history . . . and the United States is not exempt of the laws of economics. It is going to happen here.
"All is not lost, according to Griffin, and it starts with something he calls 'The Creed of Freedom.' Griffin is working on global solutions to this massive bad leadership problem."
Join Greg Hunter as he goes One-on-One with economic and geopolitical expert G. Edward Griffin.
https://www.youtube.com/watch?v=jsvm0qAj5mc’
Published on Feb 15, 2015:
"John Williams, of ShadowStats.com, says the Fed has given a false sense of security but did not fix the problems that led to the last meltdown. Williams warns, 'People say everything is fine again—nonsense. You had a panic in 2008. . . . The system was on the brink of collapse. The Fed and the federal government did everything in their power to prevent it. They pushed things into the future, but they didn’t do anything of substance to address the underlying problems.' So, are we going to have another panic? Williams says, 'Yes, and that is the type of thing that can break at any time, and you just don’t have the options you had in 2008 for buying time into the future.' Williams adds, 'The odds are high you are going to see the beginnings of hyperinflation this year.'”
Join Greg Hunter as he goes One-on-One with economist John Williams, founder of ShadowStats.com.
http://usawatchdog.com/economy-has-no...
Hyperinflation in the stock market isn't the same as hyperinflation in the supermarket.
BERNIE 2016
From FB
Bernie Sanders 35 mins ·Some people say my economic ideas are radical. You should hear what the Pope is saying:
“Just as the commandment ‘Thou shalt not kill’ sets a clear limit in order to safeguard the value of human life, today we also have to say ‘thou shalt not’ to an economy of exclusion and inequality. Such an economy kills. How can it be that it is not a news item when an elderly homeless person dies of exposure, but it is news when the stock market loses two points?” - Pope Francis
Right about this time one would expect for there to be a big propaganda push towards the pious nature of poverty. Just like in the times of old, you will get your reward in the afterlife... of course the priest class always takes there rewards in this life.
Thou shalt not steal.
Thus, shut down all government.
-----
THERE. FIXED IT FOR EVERYONE.
Including the dope called the pope.
And Bernie too, of course.
Hillary for Prison 2016
Raise rates and bail in the banks. That is what Jade Helm is for.
Good point. If QE becomes pointless they still have assets of ours to harvest and some of that is already taking place in the markets.
Point: Per the Chapwood Index, the cost of living increased 12.4% in 2014 in the USA.
Counterpoint: Bring on Paul Volker II to do what his Doppelgänger did in 1981 - raise Fed Fund rates to 20%.
Resolution: Derivatives collapse and we are in a world depression for one generation.
Hey NZ ... A war would do it. No?
I don't see how QE can stem the tide of Chinese collapse, oil collapse, gold suppression costs, perpetual war, shit tons of dollars coming home etc. Any QE is likely to have a very short term effect and throw us right into hyperinflation...... so yeah they'll probably do it.
Any Fed tightening will bring rising prices, not further "deflation."
They should actually just shut down.
Don't tighten, don't loosen.
Just leave.
The sad part IS that each time the market moves towards lower inflation which would be helpful in terms of finally allowing a clearing of the real economy, these jerks step in and delay it all over again at all costs with more ZIRP/QE because the priority is not help the economy heal, but to keep asset prices inflated. I would love to see my rent come down instead of rising at rates well above my non-existent pay increases. I would love to see lower gasoline prices for awhile. I would love to get more value for my money instead of what has been happening as my costs (including state income and sales taxes) keep going up while my pay is no higher than it was a dozen years ago.
It's about time that the riots started against our discredited Keynesian overlords. And screw Obama and Clinton who have done everything possible to allow colleges to keep inflating tuitions at insane rates. This country is going to collapse under the weight of all the debt these free lunch for everyone lunatics are creating.
Maybe its time to jump the shark and take paul krugmans advice by fighting a false war against an alien invasion.
Although it might not be so false because every cuntry is being invaded by aliens at their borders.
In ancient Rome, its satrapies annually loaded oxcarts with gold a treasure to pay Tribute to the leader of the world and for the protection it offered.
2000 years later the Second Rome does not expect Tribute of gold and treasure.
No. What it expects from it's latter day satrapies is for their central banks to take the oxcarts full of the former reserve currency, the dollar, out of the US, and to hold 100s of billions of them on their balance sheets so that the New Rome's Federal Reserve Bank can print trillions more of them without worrying that they will come home and create hyperinflation.
The US and the Fed will soon be beholden to the central banks of the West for allowing Washingon to buy a little more time.
We all know The Fed “Never Sees It Coming”.
What’s a little less obvious is that The Fed “Never Makes It Happen”. That is to say, what happens is always different that what The Fed wants to happen, which is to say The Fed is always reacting to its prior failures with actions that are also destined to fail.
The Feds only hope now is to come up with some new and amazing strategy so complex that no one understands it, so when it fails next time no one will realize that it did.
How do I get a job like that?
Gotta smile ... for months been saying FED QE4 by xmas and looking at all the other things going on still think the same.
Even all in QE by China was on the card its portion of the global economy was based on western manipulated values that have mainly been a malinvestment for the last 40 years to pretend everything is fine.
Japan, should have bust over a decade ago that was being bailed out by a money printing global economy again a malinvestment and shit hits the fan when it seem unlikely you can maintain that level of malinvestment.
Then for derivative, no more than a way to hide debt by creating artificial value to pretend things added up to more than they did.
So surprised ... nope ... print again for sure, indefinitely if they do not agree a global print on an infinite timescale. Without that agreement every nation in the world is going to TRY AND OUTPRINT THE REST.
Well stated and true for those that are able to see our current and future realities.
A number of observations however.
- ZH readers realities are not the realities of the average 90% of US citizens. They are not pro or con. Their investments are in the hands of others, and its is these others that the FED is speaking to.
- Congress is not involved. There are no political or societal fears. There are no current ripples that Sunday Boaters can see.
- There is full faith in the US Dollar and US Govt by the population. The FED is not even a discussion point. Our public simply does not understand the US monetary practices. The current US budget numbers are "frozen" indefinitely and no one other than financial commentators seem to care.
- School is starting, football is back, the election campaign is in full swing and name calling is the kabuki theater of the day.
The FED has control through its US and Foreign market and monetary Entities. These entities then communicate with the public. Unless panic hits, Internationally or domestically, nothing will change.
What if everyone but retail investors are told not to sell any asset class? Does anyone think they will disobey?
We don't want anymore Q.E. Thank you very much. Just keep out of it and let the market adjust. If you want to steal the product of our labor, just say so, instead of hiding the theft behind the inflation. which the average Joe Sixpack doesn't understand _JOHNLGALT. By the way, WHO IS JOHN GALT?
The Gold Bugs are RIGHT!
BITCHEZZ!
The South was right!
Janet in Blunderland - Yes, Janet, cutting off your head will cure your headache.....
Do not overlook all the over leveraged 'stronger dollar' trades that were put into place based on a Fed rate hike. The whole facade has been kept going for years because everyone was on one side of every trade. We may finally be seeing a time when a big bank is way way way on the wrong side of trade - and cannot get out. Will we bail out a TBTF again?
Oh, because QE has helped so much before?
As I have suggested before, the FED should buy strategic commodities across the board for their QE, in a manner that makes bonds look more stable. They need (in the long run) to control the military industrial complex.