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Peter Schiff: "Once Again Fed's Bark Fails To Live Up To Its Bite"
Submitted by Peter Schiff via Euro Pacific Capital,
Once again the Fed's bite has failed to live up to its bark. Despite months of expectations that it would finally raise rates for the first time since 2006, the Fed continued to sit on its hands while pointing to some unspecified date in the future when all the economic and financial stars will align in a way that makes a 25 basis point increase appropriate. Am I the only one getting bored by the repetition?
Just like it has in prior statements, the Fed's Open Market Committee painted a picture of a stable and growing economy that was just about ready for a tightening cycle to begin. Its decision to hold off for now was positioned as a temporary concession to largely overseas developments. But the Fed, and the rest of the economic establishment for that matter, continues to ignore the steady torrent of negative data that reveals a slowing economy. Based on the manufacturing, business investment, productivity, and consumer confidence numbers, the Fed could be preparing a fresh round of stimulus, not readying its first economic sedative in nine years.
Today's surprisingly dovish statement was notable for the introduction of "international developments" as an ongoing input into the Fed's rate deliberation process. To many, this refers to the current uncertainty in China. But, in reality, this shift offers the Fed a gallery of new excuses to choose from to explain away its failure to raise rates down the road. Now weakness at home and abroad is sufficient to keep the Fed on the sidelines. The last thing we needed was more excuses.
As I have maintained continuously, rate hike talk from the Fed is just a bluff to disguise its inability to tighten, as even small increases could be sufficient to prick the biggest bubble it has ever inflated. It is no coincidence that the stunning 170% increase in the Dow Jones, that occurred between March 2009 and the end of 2014, happened while the Fed was stimulating the economy almost continuously with QE, and that the rally came to an abrupt end when the QE stopped in December 2014. The recent 10% correction on Wall Street confirms to me just how sensitive the markets remain to the prospect of any rates higher than zero.
When the year began, opinion was divided between those who thought the Fed would move in March, and those who thought it wouldn't happen until June. When June came and went, September became the odds-on favorite. Now those same experts are once again divided between December and sometime in 2016. When will these "experts" finally connect the real dots and discover that the monetary medicine that the Fed has doused over the economy since 2008 has only created a weak and utterly dependent economy. A rate hike is supposed to be a signal that the economy has a clean bill of health. But as the patient fails to recover, another dose of QE will be just what the doctor orders.
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He's dead, Jim.
https://www.youtube.com/watch?v=MH7KYmGnj40
"He's dead, Jim."
The needs of the many bankers, outweigh the needs of the few everyone else.
It's kinda like chemo
Chemo solves the problem eventually. This is more like prescribing steroids for cancer and hoping the roids keep the patient standing for a while before the super-tumors end them under the next doctor's watch.
When bank robbers are in charge of the bank, it should be no surprise that the vault is empty. The United States is run on IOUs, with Wall Streeters and banksters on a spending spree using money borrowed from this nation's future. Worse of course, is that our leaders are, for the most part, degenerate satanists in the Jimmy Saville/Leon Brittan mold, pedophile monsters.
Dude - you're hitt'n 'em outta the park today... That 'Plan 9' clip was precious... They actually, really dressed up and acted for that movie - and did a man's job on top of it...!
The funky thing about Control, as a lifestyle and a pathology, is that by definition it will eventually find itself in a corner, leaving behind a great big swath of misery and chaos.
Control is an illusion.
But control fraud is real.
The picture in the icon of this post needs to be included, for scale.
Reminds me of the boy who cried wolf... Soon the fed will lose all credability.
What do you mean by "soon" ?
How soon is now?https://m.youtube.com/watch?v=lIHOZOZYIHs
We ZHers know the jig is up but 98% of the population are still asleep. So how long is soon? I don't know... depends how quick the awoken awaken the sleepers.
I have news for you: FED lost its credibility a long time ago among those who matter decision wise...
What ever happened to 'ole Morrissey anyway...?
The Fed is very close to abolishing itself. Flaccidity of ZIRP and QE reveals that the Fed is out of weaponry. Helicoptering money out of airplanes will also prove ineffective. The Fed has a nailgun to its own head and is pulling the trigger repeatedly. A few more nails and the Fed will have suicided itself.
"The Fed is very close to abolishing itself. "
If that were to be true it would be because they had accomplished their mission statement(the real one).
Bankrupt the country
Destroy the Republic
Transfer the real wealth to the Rothchilds, Warburgs, Rockefellers, et al
Pin the debt on the people
Disappear, No one accountable.
He said Fed's bite does not live up to its bark
Where are all the CNBC trolls who have been giving Schiff hell? I want them to come talk their shit now. Scott Nations, I'm looking right at you, you Biff looking mother fucker.
A bunch of them are over at SilverDoctors giving me shit the last few weeks.
Their time is at hand.......coming soon. Tick tock motherfuckers!
We'll likely have the last laugh, Bay...
" Tick tock motherfuckers!"
This clock's shaped like a briefcase!
This morning, they were expressing surprise.
even small increases could be sufficient to prick the biggest bubble it has ever inflated
I don't think it's the one time that's the real problem, It's the fact if you do 1/4% then you must do more. Why in the hell would you raise it once, you wouldn't in this situation.
That's the prick.
Back in the early 80's I asked a realitor when she thought housing would pick up, and she said, she was told if rates got below 10% which it soon did and housing did PU.
What's happening today is ridiculous.
I'm sure as hell not voting for Mr Tippy Toes, It's MR T or Bust
Way to go MR. Schiff. I almost felt sorry for you because you had been "wrong" about many things in the past (the decline in price of Phys. Gold), but it is looking like over the long term you are increasingly right.
I personally thought the FED would tighten a measely .25% to save face and to at least make a feeble attempt to bluff the people into thinking that the economy was starting to turn around. But no, the FED has become a total wimp and bullshitter. And Mr. Schiff, you have called it right, and more forcefully than anyone out there. So credit is due.
The problem Schiff and Dr Doom and others face is the timing not the outcome...
Picture a drunk at a bar or wedding, you know he will crash you just don't know how many more drinks it will take...
Peter is a smart guy. I have a lot of respect for someone that can take the day in day out bashing from intellectually bereft peers and stick to their guns. He knows he's right and doesn't mince words about it. Works for me.
His dad Irwin is a badass as well.
The chickens are coming home...just leave the way open, they'll find it. ;)
the fed has effectively created and transfered billions to the club. no failure whatsoever. the plan all along since hank the crank pushed through the bailout and gomez obolo took tha baton.
now any furthur developments are just the continuation. the only question that remains is what are the buds in the the club doing with their billions? certainly not all in on dollar valued securities, but surely a plan in place when it stops working to their planned advantage. us the majority, should be small scaleing a simular plan less the nailguns and lears, ha...
Continued wealth transfers to the top people at Goldman and JPM
True dat Yogi:
Don't worry Janey Yellen, Jamie's got your back:
(Bloomberg) Life is getting better for the U.S. middle class despite mounting income inequality, thanks to improvements in technology and cars, according to JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon. Slashing CEO pay wouldn’t help, he said.
“It’s not right to say we’re worse off,” Dimon said Thursday at an event in Detroit. “If you go back 20 years ago, cars were worse, the air was worse. People didn’t have iPhones.”
This fuck stick confound-boggles the mind in equal capacity as Janey Yellen.
The brief (mercifully) article below, not recommended for the feint of shart:
http://www.bloomberg.com/news/articles/2015-09-17/dimon-says-iphones-cars-help-balance-out-u-s-income-inequality
No time to read the article I just logged to say I love that photo of the big boned bride saying MOAR. What a great Meme.
Bride? That's Yellen.
Clearly Janet is a keen student of the "Monty Python thin mint" school of economics.
Who knows what horrors a .25 hike would have unleashed? (-;
https://www.youtube.com/watch?v=HJZPzQESq_0
We had the same thought
Picture reminded me of Monty Python's.
Mr. Creosote
www.youtube.com/watch?v=aczPDGC3f8U
And it's what is going to happen to the
'Too Pig to fail' banks
Im still thinking in the third quarter of 2000andnever
Many readers here have said the Fed will NEVER raise rates. I agree, they can't...or total collapse. But, what has changed is now Janet's comments about MOAR QE if needed (and it will be) were sold. That is not the stuff the Fed bubbles are made of. If the lemmings now fear the Fed is dead no matter what they do, a big decline is about to begin. MOAR QE will be seen as more failure, and after they were talking about a hike for the past 6 months? LMAO.
They won't say it, but things are slowing down a lot, and they know it. Massive debt overhang is killing consumers and the bloated government can't do much more either. Entitlements are crushing the budget along with MIC spending. Social Security, Medicare, Medicaid, EBT, welfare, veterans benefits...everyone wants a free ride. More wars are planned, as the oligarchs try to divert attention from the economy.
Jobs at China Mart go to illegals and don't pay enough anyway for a McMansion and two Lexus SUVs. Things are about to get ugly with the omnipotent Fed now backed into a corner. Millions are angry about stock prices falling and most see the Fed as friend only to the wealthy.
The mother of all bubbles is in Silicon Valley, and when it goes, look out below....Dow 7k, real fast. Even QE 5,6 and 7 won't stop the decline.
"Massive debt overhang is killing consumers and the bloated government can't do much more either."
The consumer is maxed out. He is unable and unwilling to borrow anymore. It is amazing that they cannot comprehend this. No ivory tower is that high. Deflation is inevitable. The next play likely isn't NIRP, but NIncomeTax. That's the vaunted helicopter drop. But it won't matter. People will pay down debt, but they won't initiate enough new consumption to matter.
Fucking sulphurs at the FED don't get that THINGS ARE JUST TO FUCKING EXPENSIVE. Pric3s must fall because there is no policy tool or mechanism that can raise wages enough to soak up the overcapacity-of-everything we are facing.
You Sir are spot on!
The goat innards were full of maggots.
Peter Schiff: Yellen Admits Rates Could Stay at Zero Forever https://www.youtube.com/watch?v=gi1v8AvZY4k
Talk about begging for misallocation of capital. This screams it. That's the problem with zero rates: so much is borrowed for inefficient purposes. Just another way to pump the bubble ever larger.
I will postpone judgement on this issue until I hear what Jim Cramer has to say about it.
The Fed is owned by other banks and investors... I would really like full disclosure of who these people really are...Wouldn't JP Morgan be one of the big share holders? Normal public companies have to disclose this info. the Fed is like Kaiser Sousa...
Wouldn't a comprehensive Economic plan for the Domestic Economy prepared by the US Congress be far more effective and efficient than handing it all over the the Private Federal Reserve Stock Holders??
- It is not like the USA has actual defined policies any more anywhere.
- USA is run by School children.
As if these CRIMINALS haven't been foolish enough!
waiting for the next big pump and dump
isn't that supposed to be "its bite fails to live up to its bark" - or am I just missing something ?
The runaway train that we are all on is picking up speed. No one knows how much longer it will be until it reaches the end of the line (and the big, historical CRASH occurs).
The most scary part: None of us can get off of this train.
More evidence of the train picking up speed towards its big BOOM.
http://www.armstrongeconomics.com/armstrong_economics_blog
You can get off the train if you keep all your liquid wealth in gold or silver, well hidden where the predators-that-be cannot find it.
According to Macquarie Research:
https://app.box.com/s/hx16540dwpct4uj5h5iohxsa4197zozd
Time for a policy U-turn?
Back to the future: British Leyland
From conventional QEs to more unorthodox policies…
- As discussed (here and here), we do not believe that investors are likely to benefit from acceleration in growth rates, trade or liquidity and indeed on the contrary, negative feedback loops from EMs to DMs imply that neither would be able to support global growth. Secular stagnation is the key explanatory variable (here). The deflationary pressures from overleveraging, overcapacity and technology shifts can be either allowed to work through economies or the public sector needs to continue resisting via expansionary policies.
- Since ’08, monetary policies were doing most of the lifting with limited participation by fiscal authorities (bar China). In other words, in the absence of either private or public sectors driving higher velocity of money, it was Central Banks that were supplying incremental liquidity to preclude contraction of nominal GDP and avoid stronger deflationary pressures. However, marginal utility of incremental injections has been declining (witness much lower impact of recent ECB’s QE and increase in BoJ accommodation since Dec ’14).
- Part of the reason for monetary stimulus fading is that supply of US$ remains low. Global economy continues to reside on a de-facto US$ standard and current incremental supply is almost non-existent (depending on definition growing at +2%/-1% clip vs. average since ‘01 of ~15%). In other words, due to lack of recovery in the US velocity of money and lack of QEs, global economy is not getting enough US$ to continue leveraging.
…as efficacy of conventional monetary QE is questioned
- At the same time efficacy of continuing with conventional QE policies is being challenged and not just by independent observes but also ‘insiders’ (such as recent SF Fed paper). As velocity of money globally continues to fall, conventional QEs have to become exponentially larger, as marginal benefit declines. If the public sector is not prepared to step aside, what other measures can be introduced to support nominal GDP and avoid deflation?
- There are several policies that could be and probably would be considered over the next 12-18 months. If the private sector lacks confidence and visibility to raise velocity of money, then (arguably) the public sector could. In other words, instead of acting via bond markets and banking sector, why shouldn’t public sector bypass markets altogether and inject stimulus directly into the ‘blood stream’? Whilst it might or might not be called QE, it would have a much stronger impact and unlike the last seven years, the recovery could actually mimic a conventional business cycle and investors would soon start discussing multiplier effects and positioning in areas of greatest investment.
British Leyland failed, but it might work at least for a while
- British Leyland (formed from nationalized British car companies in the late ’60s) destroyed its automotive industry but for a time it provided employment and investment. Central Banks directly monetizing Government spending and funding projects would do the same. Whilst ultimately it would lead to stagflation (UK, 70s) or deflation (China, today), it could provide strong initial boost to generate impression of recovery and sustainable business cycle. It could also significantly shift global terms of trade (to the benefit of commodity producers) and cause a period of underperformance by our ‘Quality & Stability’ portfolio and improve performance of ‘Anti-Quality’ screen. What is probability of the above policy shift? Low over next six months; very high over the longer term.
At least the British are now manufacturing products with a rising popularity...
http://www.telegraph.co.uk/news/health/news/11873435/Super-gonorrhoea-ou...
Today's surprisingly dovish statement was notable for the introduction of "international developments" as an ongoing input into the Fed's rate deliberation process."
I've been saying for some time now that the Fed has to raise rates to maintain credibility. I still believe that, and, I believe the Fed KNOWS this too. Yet, because it didn't go forward today, the stage is now set for collapse very soon. It might've been forgiven for saying the economy was better than a hike would've revealed (if they ever actually believed that), while trying to do the right thing in raising rates on that belief. But, they didn't do that.
Now...they're fucked, and credibility is indeed shot.
You CANNOT claim an improving economy, while at the SAME TIME, hold on "international developments" beyond your control, AND float the idea that negative rates might become necessary...if your "improving economy" could've EVER withstood the microscopic rise being considered AT ALL. It just cannot be the case that BOTH views are valid simultaneously.
This also means, that somehow, we're going to become strong enough to handle a rise in the future, despite all this time to gain that strength without doing so, and STILL be faced with those "international developments" , perhaps grown even worse...also still beyond our control...
...when we haven't been able to achieve this WITHOUT this issue thus far.
Now, how does that make sense?
Clearly, it doesn't.
Folks, if we're ever going to actually recover, the Federal Reserve System is going to have to go, as a good start toward that end.
m
As the I$I$ "backed" Saudi Mercan dollah clogging the Ponzi crapper of Mercan "capitalism" is being vigourously flushed from the global sewer and the Potomkin Village USSA "economy" dissolves in an orgy of global war and pig state brutality, real policy is being decided in Moscow, Peking and Asia where the toilet paper scam of the Fed is the biggest joke du jour.
Onward then oh exceptionals to Hooverville, that rancid shanty in the mire that we all confused with some shining city crap on a hill!
All this writing, all those disgusting talking heads on TV, all this academic outpouring of crap, all the pundits pontificating - FOR A FUCKING LOUSY ONE-FOURTH OF ONE PERCENT 'RAISE' !!??!*** Jesus H Christ on a crutch. The whole fucking world economy will crash if the Fed raises rates a FUCKING LOUSY ONE-FOURTH OF ONE PERCENT?
It seems that none of the actors in this non-drama can stand back three feet and look at what they are saying - this FUCKING LOUSY ONE-FORTH OF ONE PERCENT has become a Life or Death, Very Serious Issue for all the banking establishment big wheels and Phd Economists. It seems some of them really, truly take this seriously. Amazing, pompous, stupid assholes pontificating forever about a FUCKING LOUSY ONE-FORTH OF ONE PERCENT.
The Fed ain't gonna raise, evah. Not December, not 2016, evah - 18 trillion in US debt sez so.
Like Romans in 300 AD or so, we are fucked.
All this writing, all those disgusting talking heads on TV, all this academic outpouring of crap, all the pundits pontificating - FOR A FUCKING LOUSY ONE-FOURTH OF ONE PERCENT 'RAISE' !!??!*** Jesus H Christ on a crutch. The whole fucking world economy will crash if the Fed raises rates a FUCKING LOUSY ONE-FOURTH OF ONE PERCENT?
It seems that none of the actors in this non-drama can stand back three feet and look at what they are saying - this FUCKING LOUSY ONE-FORTH OF ONE PERCENT has become a Life or Death, Very Serious Issue for all the banking establishment big wheels and Phd Economists. It seems some of them really, truly take this seriously. Amazing, pompous, stupid assholes pontificating forever about a FUCKING LOUSY ONE-FORTH OF ONE PERCENT.
The Fed ain't gonna raise, evah. Not December, not 2016, evah - 18 trillion in US debt sez so.
Like Romans in 300 AD or so, we are fucked.
Overcapacity could also be sucked up through a currency de-valuation. It could move capital off the fence with fear of another one coming behind it. Be very afraid!!!!!
He's right! I was wrong. I thought they would move as I don't see how the negative effects of moving up .25 could possibly be any worse than the effect of the (tacit) admission that they have lost control of monetary policy.
Pay no attention to the little banker behind the curtain. I am the Great FED and I decide what it takes to make Merica great again!!!!!!!
Peter has been right from the beginning. The movie is developing has he has figured out, next QE4. So if you want to save yourself and may be the country against a criminal Fed and their owners, Wall Street, do what Peter advises: buy gold and silver, and then relax.