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Stocks Surge As ECB Expands QE Monetization Limits, Boost Purchase Threshold From 25% to 33% Per Issue
ABN Amro was right: moments ago Mario Draghi announced that, just as the Pavlovian Dogs were salivating, the ECB would not leave markets hanging, and while not boosting QE in size, announced he would increase the amount of monetizable assets, i.e., the ECB's share limit per CUSIP equivalent, from 25% to 33%. The result: an immediate surge in both stocks (ES jumping 21 points) and bonds (the 10Y dropping to 2.156%).
Which has snapped EURUSD 100pips lower - erasing all the post-FOMC Minutes gains...
But wait, that's not all: as was clear to all but the most tenured economists, Draghi also just cut Europe's GDP outlook across the board.
- ECB STAFF SEE 2017 EUROZONE GDP AT 1.8% V JUNE 2.0%
- ECB STAFF SEE 2016 EUROZONE GDP AT 1.7% V JUNE 1.9%
- ECB STAFF SEE 2015 EUROZONE GDP AT 1.4% V JUNE 1.5%
And here is why more QE, also in absolute terms, is also assured:
- ECB STAFF SEE 2017 EUROZONE HICP AT 1.7% V JUNE 1.8%
- ECB STAFF SEE 2016 EUROZONE HICP AT 1.1% V JUNE 1.5%
- ECB STAFF SEE 2015 EUROZONE HICP AT 0.1% V JUNE 0.3%
Expect the stock surge to continue, because there is nothing more bullish for risk that confirmation what sent risk higher in the first place isn't working, so even more will have to be used.
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What I said
He can't do shit
Exactly and it crude as I am sure other commodities are getting smacked down at the moment. Could be another wild day. Actually this whole month will not be normal and likely next month if we still are here.
Why dick around? just go to 300%, because you're gonna anyway.....
slowly slowly catchee monkey
MOAR durrency debasement! Hooray!
"The Earl of Rochester would have heartily approved"
"Expect the stock surge to continue, because there is nothing more bullish for risk that confirmation what sent risk higher in the first place isn't working, so even more will have to be used."
- Straight out of the Paul Krugman playbook
YAY! Capitalism!
And the sellers and owners of stock care not one whit that it is all based on manipulation. They only want MOAR.
Well of course not. A lot of people have 401k's and pensions. They sure as hell do not want to see their retirement evaporate. This is why anyone who has tried to save money for retirement by .gov and banks education programs will defend it. Basically they got majority in a choke hold. Everyone wants QE except us on ZH. We are the minority.
saints51 - so how are you expecting to retire? Gold stashed under your bed?
Peeps been calling for the markets to crash since 2009. Sky falling.
At this point, anybody who is still counting on their 401k and other paper "investments" for their retirement nest egg is a fool.
Where's that chick with the thong to throw confetti on these mofos when you need her.
"ABN Amro was right: moments ago Mario Draghi announced that, just as the Pavlovian Dogs were salivating, the ECB would not leave markets hanging, and while not boosting QE in size, announced he would increase the amount of monetizable assets, i.e., the ECB's share limit per CUSIP equivalent, from 25% to 33%. The result: an immediate surge in both stocks (ES jumping 21 points) and bonds (the 10Y dropping to 2.156%)."
I want to make sure I understand this. They can now buy up to 35% of a company's shares?
And how come ABN Amro was right? Did they get to hear market moving information before anyone else.
(Note the lack of a question mark!)
Bonds.
Thanks.
Would I be wrong if I conclude they are also buying stocks as well?
God knows what they're doing behind the scenes.
We are so screwed.
They'll be at 100% before you know it. We've got to destroy the markets in order to save the markets.
Burn the village to save the village.
quick, rape the horses and ride off on the women.
This isn't that tough. They just buy everything up, pushing prices up in a dying economy which will only create more demand for the assets they hold. Its called "winning".
'The eCONomy is tanking, so hand over your money so I can give it to the rich'
He tinkled the bell but I queefed instead of salivating. What's wrong with me?
Monetised assets.
They can buy a more broad range of (junk) assets than heretofore.
This will end even worser.
So the economy is failing, Recession is starting, Bankers panic and pile up more debt so the crash will be bigger - and markets rise because they're headed for a crash??!! We're in the matrix.
how fucking pathetic that the only way ''markets'' can go higher these days is when there is jawboning from the central banks around the world
Meanwhile real profits are crashing....
Not exactly true. Apple, Google, and a host of other tech companies are making more profits than ever before.
Why would gold drop if he said the ECB would increase the amount of monetizable assets??
Remember - Gold is a barbaric relic
This is what I don't understand. If 5 years ago you told what has happened is pretty much what I thought would yet Gold and Silver got hammered. I guess it's based all on USD but to me it's beyond frustrating and I'm at point where I don't care any more. Sell my gold and silver. Spend like everyone else for as long as it remains held together and if it collapses I just go steal it from those stupid enough to sacrifice the past 7 years.
@Seasmoke
Soon swawp your gold for silver..............if GSR goes to 80+
Swawp the silver for gold when GSR is back below 40-30
PM's will have thier time just not yet
We are at 2008 again.....................what happend to the price of Gold..............it went down and hit a bottom and the went to $1900...............we will see that price and more........................given time.
The fundamental reason gold would drop today on this news is that the inflation rate is dropping.
The gold market is basically a plaything for the CBs -- they can used the artificial and outsized paper gold market to monkey hammer gold prices to whatever level they want. I'm still waiting for China to buy a huge amount of paper gold, ~3x more than the entire planet holds, then insist on delivery. That will teach the Western CBs a lesson in reality.
Boy, I sure wish I had a printing press, so I could just buy everyone's debt and own them forever.
Well we all get to Eat. Drink and Fuck as another Labor Day weekend will be a celebration !!!!!
Knew they would get us out of summer unscathed. Now if they get us out of Fall I think I will be ready to join them. There is no sense fighting them.
Can't ruin Christmas. Duh! That's just want the liberals want. USA! USA! USA!
Labor day. What a fucking joke, should be called debt slave day, most people don't know what real labor is anyway. Putting my hot dogs, hamburgers, and beer on my credit card... 'Murka.
QE is like heroin. The banker mafia now has the entire west nicely hooked.
Gold (God) is such an old-fashioned concept. Man's philosophies and theories have made gold (God) obsolete. Better the securities and instruments that man creates than gold (God) that's eternal and impossible for man to replicate. Everyone knows there's not enough gold (God) to go around and it would limit man's ability to expand his wealth. Fiat money, directed by well-educated people, makes gold (God) barbarous relics that only crackpots and hate-mongers hold on to.
Thank grid for our modern, indestructible society.
Wasn't QE supposed to be against the EU constitution, making it illegal, at one time?
I guess they also have a 'worthless piece of paper' that gets in the way all the time.
Surprised? No... Hell no!
Gonna keep right on doing "it" to the very bitter end!
Count on it...Better yet, bet on it!
Too low, make it 666%.
The most dangerous thing in the world is a central bank fighting for it's life.
A wise man see's calamity coming and prepares.