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China Cuts Interest Rate By 25 bps, Cuts RRR by 50 bps; Futures Soar; Fed December Rate Hike Back In Play

Tyler Durden's picture




 

Just two days ago, we noted that according to Citi's Willem Buiter, there would be "Imminent Easing From Central Banks Of China, Australia, Japan And Europe." Fast forward 48 hours when he is already half right - not only did Europe confirm it is about to cut, but moments ago none other than China joined the global easing orgy when in a completely unexpected development as it happened on a Friday (we are scouring  various databases to find the last time, if ever this happened) China announced it has cut not only its 1 year lending rate and 1 year deposit rate by 25 bps, but also its reserve requirement ratio by 50 bps.

  • CHINA CUTS BANKS’ RESERVE REQUIREMENT RATIO
  • CHINA CUTS INTEREST RATES
  • CHINA CUTS 1-YEAR LENDING RATE BY 0.25 PPT
  • CHINA CUTS 1-YEAR DEPOSIT RATE BY 0.25 PPT
  • CHINA REMOVES DEPOSIT RATE CEILING FOR BANKS
  • CHINA CUTS RESERVE RATIO BY 0.5 PPT
  • CHINA INTEREST RATE CUT EFFECTIVE FROM OCT. 24

The PBOC's statement in its google-translated entirety:

People's Bank of China, from October 24, 2015, down financial institutions RMB benchmark lending and deposit interest rates, in order to further reduce the social cost of financing. Among them, one-year benchmark lending rate by 0.25 percentage point to 4.35%; year benchmark deposit rate by 0.25 percentage point to 1.5%; adjusted for each other grade benchmark interest rate loans and deposits, the People's Bank lending rates of financial institutions ; personal housing accumulation fund loan interest rates remain unchanged. Meanwhile, commercial banks and rural cooperative financial institutions are no longer set the upper limit of the floating interest rates on deposits, and pay close attention to improve the market-oriented interest rate formation and regulation mechanism, strengthen the central bank interest rate system of regulation and supervision, improve the efficiency of monetary policy transmission.

 

Since the same date, down financial institutions RMB deposit reserve ratio by 0.5 percentage points, in order to maintain reasonably adequate liquidity in the banking system, guide steady moderate growth of money and credit. Meanwhile, to increase financial support for the "three rural" and small businesses a positive incentive for additional standards-compliant financial institutions to reduce the deposit reserve ratio by 0.5 percentage points. (Finish)

And the comments the PBOC made in the aftermath of the surprise announcement:

  • Central Bank will continue to monitor economic and price situations closely and use multiple tools to maintain liquidity at reasonable level, PBOC says in statement on website.
  • China’s overall prices at relatively low level, and it provided room to cut benchmark rates
  • China cuts reserve ratios to maintain banking system liquidity at reasonable and ample level
  • Decreasing market rates and moderate rise in consumer prices provided environment and time window for China to remove deposit rate ceiling
  • China’s current monetary policy remains prudent

S&P futures surge nearly 20 points on this latest scramble to ease, which is just the latest green light by central banks to take on more risk, and as a result fresh all-time highs in the S&P500 are now just a matter of time.

 

But the real take home message here is that both the ECB and the PBOC just confirmed a December Fed rate hike is suddenly in play once again, especially since this move by China should remove Yellen's conerns about Chinese growth.

Markets hope this time is different...

 

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Fri, 10/23/2015 - 07:24 | 6701961 achmachat
achmachat's picture

So... who is now going to say that the Fed is ever going to raise rates?

Fri, 10/23/2015 - 07:24 | 6701962 kliguy38
kliguy38's picture

are you saying they're lying?

Fri, 10/23/2015 - 07:29 | 6701971 SheepRevolution
SheepRevolution's picture

To hell with this, I'm getting out of equities. Long positions, short positions, it's all bullshit

Fri, 10/23/2015 - 07:30 | 6701975 SoilMyselfRotten
SoilMyselfRotten's picture

Hello gold pop!

Fri, 10/23/2015 - 08:02 | 6702029 VinceFostersGhost
VinceFostersGhost's picture

 

 

are you saying they're lying?

 

Probably not directly.

 

Are you?

Fri, 10/23/2015 - 09:07 | 6702218 SSRI Junkie
SSRI Junkie's picture

seven years of waking up to the same day

 

https://www.youtube.com/watch?v=M628DuIEZ_o

Fri, 10/23/2015 - 09:23 | 6702291 steveharless
Fri, 10/23/2015 - 07:32 | 6701977 Haus-Targaryen
Haus-Targaryen's picture

Did we really expect anything else? 

Fri, 10/23/2015 - 07:38 | 6701989 Hype Alert
Hype Alert's picture

Doesn't this simply strengthen the dollar, which is the #1 issue in earnings releases?  How can the Fed raise rates into this?

Fri, 10/23/2015 - 07:50 | 6702011 Haus-Targaryen
Haus-Targaryen's picture

They can't raise rates.  We are at 0 until it gets hyperinflated away sometime in the future.  

I think the question now is, will they do;

a) ZIRP
b) QE4(eva)
c) a & b 

I have seen some suggest they'll do QE4 & raise rates at the same time, but this won't help with debt service costs for entities that are the beneficiaries of fed cash via balance sheet expansion.  

I think we dabble into ZIRP first, then add QE4 thereafter.  

I don't really have moral outrage over this anymore like I used to.  The average person is either too stupid to know how NIRP & ZIRP destroy savings or know it and are too lazy to do anything about it.  Given the overwhelming amount of information available on the web about the horrible after-effects of NIRP & ZIRP, I am just fine with what the Fed is doing.  

Fri, 10/23/2015 - 07:52 | 6702017 Hype Alert
Hype Alert's picture

I just didn't get why they thought the following:

 

"But the real take home message here is that both the ECB and the PBOC just confirmed a December Fed rate hike is suddenly in play once again, especially since this move by China should remove Yellen's conerns about Chinese growth. "

 

 

Fri, 10/23/2015 - 08:00 | 6702020 Haus-Targaryen
Haus-Targaryen's picture

Because as the ECB and the PBOC "ease" their respective currency zones -- it should "strengthen" their economies via a weakend currency and strong sales via exports along with a higher demand for domestically produced goods as opposed to imported goods.  

The "frailty" of Rainbowland (EU) and China were one of Mr. Yellen's excuses for not raising rates last month.  

Thus with them easing, it removes the only two impediments to Yellen raising rates.  She'll have to come up with new excuses for December's FOMC. 

Fri, 10/23/2015 - 08:03 | 6702032 Hype Alert
Hype Alert's picture

Yeah, it's obviously all part of the spiral we're in.  They cut, we cut, they cut...  Glad nobody's panicing over the need for China to cut again.  lol

Fri, 10/23/2015 - 08:04 | 6702034 negative rates
negative rates's picture

You really meant she has until dec to come up with new excuses, if the gvt doesn't default first.

Fri, 10/23/2015 - 08:05 | 6702039 Haus-Targaryen
Haus-Targaryen's picture

.gov won't default while they can just print to pay off their "debt."  

The debt ceiling has been raised to almost $20 Trillion, but who cares ... at this point its just funny money and a bunch of zeros.  

Fri, 10/23/2015 - 08:11 | 6702051 new game
new game's picture

red /blue game of numbers, off balance sheet phoney money made real by captivated sheep stuck with no other option ,whilst the the top .01 percent game it and live a life only sheeple can imagine, playing right into the game of thrones...

Fri, 10/23/2015 - 08:36 | 6702119 negative rates
negative rates's picture

Life is not a game, unless games are your life, knuckler.

Fri, 10/23/2015 - 09:43 | 6702360 new game
new game's picture

whos on first, cause you be sent back to the minors for skill building, ha...

Fri, 10/23/2015 - 22:29 | 6705277 SixIsNinE
SixIsNinE's picture

right, that "no other option" thing is looking us square in the face ...

i remember the author and very cool person, Joe Bageant - he wrote Deer Hunting for Jesus, Waltzing At the Doomsday , Idiot America & Rainbow Pie - he wanted to relax somewhere that was not expensive, and he chose Mexico.  IIRC a nice regular Mexican beach town - he found, visited and decided he could live there and befriended a nice Mexican family, who needed their own property, bought them the property for $8,000 with the proviso that he could live there anytime of the year without having to pay any mortgage/rent.   This arrangement lasted until his death which was in 2011 at the age of 65.  That sounds like a pretty cool way to go, economically and spiritually.  With computer & internets, the opportunities are unique historically. Joe made it work.   _ i just checked his joebageant.com where used to be all his work (writings) is now a internet satellite company !  go figure, i thought someone would have taken over the site and have book sales.  His way of writing about things was special to me and many others - i was so glad to find his work in 2007, it carried me through some times that were hard.   kind of a place ZH took over in late 2009.   I heard Alex Jones mention zerohedge in a comment and decided to go to the site to check it out and it's been my go to and homepage since then...

back to the main article, thanks for the ramble ... on

Fri, 10/23/2015 - 08:32 | 6702111 negative rates
negative rates's picture

You are obviously overlooking the consequences that STILL have yet to be paid to Providence, by the failed Federals.

Fri, 10/23/2015 - 08:35 | 6702116 1033eruth
1033eruth's picture

I care, because its killing the middle and lower economic stratas in America with inflation.  I saw a head of lettuce in the store for $2.89 the other day.  

What I need to do is go to Care Anonymous and stop caring.  Americans signed up for this because of willful ignorance.  Because they are trading "security" for liberty, because they refuse to hold their representation accountable, because they are so susceptible to Uncle Fraud's propaganda, ad infinitum, ad nauseum.  

I need to stop caring and just focus on prepping, reading the clues.  Honestly, its like preparing for a hurricane in slow motion.  Hurricanes you have plenty of time to prepare but if you don't do it NOW, then you will be caught unprepared.  Boarding up windows, tying stuff down, checking the generator, all that takes time and money.   So does wintering the upcoming storm.

History doesn't change, it rhymes.  Longshanks said, "SHEEP, sheep, the lot of them".  At least in the movie and it works for me.   Why should I care about the sheep, because of some nostalgic after taste emotion that we're all Americans?  Not any more we aren't.  That's history too.  

Fri, 10/23/2015 - 22:50 | 6705331 SixIsNinE
SixIsNinE's picture

right on 1033 ...."care, because its killing the middle and lower economic stratas in America with inflation.  I saw a head of lettuce in the store for $2.89 the other day.   What I need to do is go to Care Anonymous and stop caring.  Americans signed up for this because of willful ignorance.  Because they are trading "security" for liberty, because they refuse to hold their representation accountable, because they are so susceptible to Uncle Fraud's propaganda, ad infinitum, ad nauseum. "

it truly is a Amazing time to be alive, if one is to be an avid fan of humanity and wisdom ... the birth of the internet and intercontinental air travel ... at the same time linking us all together providing the existing authorities to monitor our individual behavior beyond belief ... the talk about driverless cars and abolishing cash....  .... and forced vaxx - adults even, retroactive to catch up to the children's 53 individual diseases vaxx ...  the push to tax CO2 !  listen to this ! -

tonights news in Colorado  EXTRA EXTRA Read it here ! read it here !  They say the EPA is pushing this new guideline on COAL CARBON DIOXIDE emissions !  what ?  isn't that what I exhale every breath ? ? ?   Isn't CO2 a heavier than oxygen gas? yes it is.     They reported that Colorado gets most of its electricity from clean coal power plants and already have great emissions/pollution standards yet this is a fed EPA takeover of controlling our state produced power infrastructure.   

Folks - we are being hit by many different attacks & diversions & divides & conquers ...  if we don't want a very rude awakening soon we better have some serious discussions about what is happening to this country. 

philosopher historian Alan Watt speaks about the ability of governments to make extraordinary changes during times of war ... the USA is still in a state of emergency, Continuity of Government, a state of war .... the office of President communication with the people about war has been so far removed that we seem to be getting farther from being able to make actionable movements -

stay on zerohedge and connect, with or without being an active commenter ...   there are a lot of people who care here, stay in a Love Vibration & Truth Frequency and we'll have a much richer, deeper appreciation for existence

Fri, 10/23/2015 - 08:06 | 6702040 Philo Beddoe
Philo Beddoe's picture

 

New excuses it is! Or, she will just babble like a fucking idiot and do nothing. Either or. 

Fri, 10/23/2015 - 08:26 | 6702090 Linoleum Blownapart
Linoleum Blownapart's picture

"Patience" is a virtue.

Fri, 10/23/2015 - 23:04 | 6705369 SixIsNinE
SixIsNinE's picture

in learning some old buddhist wise teaching is about patience.

the jist of it is this :  difficult people in your life allow you to practice patience, whereas should your life be only amongst like thinkers and practicers, you would never get the opportunity to practice your patience; and thus, this practice is more valuable than Trillions of Wish Fulfilling Gems    

Get that?   Not just trillions of something but trillions of Gems which might grant any wish that you so desire .... WOW   ...

deep brothers and sisters ... don't be afraid to stand on a limb when appropriate ... we have been divided & conqured by polarization and distraction & the general deceptive nature of this whole war on ____ this and war on ____ that ...

yet we choose to spend time connecting via ZH and try to remember the 4 Noble Truths as a general understanding of living ... for the end result of this practice is very good behavior, even impeccable behavior ... thus leading to a very joyful satisfying experience as the more people who behave in such manner gives opportunity for us to transform into a healing happy experience being alive interacting with other humans...

Fri, 10/23/2015 - 08:34 | 6702114 Pumpkin
Pumpkin's picture

Did this long ago.  When people who control billions of dollars complain about the market being rigged, we ain't got a prayer.

Fri, 10/23/2015 - 08:46 | 6702144 dicksburnt
dicksburnt's picture

To hell with this, I'm getting out of equities. Long positions, short positions, it's all bullshit

... and you JUST figured this out?

Fri, 10/23/2015 - 08:49 | 6702149 LawsofPhysics
LawsofPhysics's picture

Good idea, prepare for world war.

With China and the E.U. going full retard, central banks in America will soon follow. Arrogant hubris will bring the world to war, again.

Prepare.

Fri, 10/23/2015 - 07:29 | 6701972 NoDebt
NoDebt's picture

Clearly, a 7% growth rate justifies moving ever closer to ZIRP.

Fri, 10/23/2015 - 07:34 | 6701981 Philo Beddoe
Philo Beddoe's picture

Indeed, with all the lies and deceit people must abandon any dreams of shorting this pile of shit as a get rich quick scheme.  

Fri, 10/23/2015 - 07:29 | 6701973 order66
order66's picture

Didn't I just hear on CNBC that the U.S. has very little connection to China's economy?

Fri, 10/23/2015 - 08:00 | 6702025 negative rates
negative rates's picture

I did'nt think they could afford to lie any more, not without paying the consequences at least.

Fri, 10/23/2015 - 08:02 | 6702027 XAU XAG
XAU XAG's picture

Desperate 

 

Springs to mind

 

Their all Desperate

 

Pass the Parcel..................also springs to mind.

 

And one day the Parcel will go poooooooooooooooooooooooooooooooooooooof

Fri, 10/23/2015 - 08:19 | 6702068 yogibear
yogibear's picture

Round-robin easing.

ECB, China, BOJ and Fed. Easy to see what's going on here.

No rate hike. They'll state due to the economic  downturn in Europe or some other reason.

Currency wars, then real war.

Neocons in Washington think a nuke war can be won. If their wrong, oh well, they'll be in bunkers and a couple of billion will be gone.

It satisfies the twisted globalist idea of reducing population quickly. 

Fri, 10/23/2015 - 08:19 | 6702069 stocktivity
stocktivity's picture

It's all Bullshit!!!

Fri, 10/23/2015 - 08:39 | 6702130 negative rates
negative rates's picture

And if like your Bullshit, you can STILL KEEP your Bullshit.

Fri, 10/23/2015 - 09:24 | 6702294 Hal n back
Hal n back's picture

so china and ecb ease and the us tightens.

 

that means a dollar rally, so we will export less and import more.

FUBAR

Fri, 10/23/2015 - 07:25 | 6701966 Calculus99
Calculus99's picture

You can't go lower than 0% folks.

Oh wait, yes you can!

Getting scary out there folks...

 

Fri, 10/23/2015 - 18:11 | 6702124 Baby Eating Dingo22
Baby Eating Dingo22's picture

How NIRPy can things go?

Fri, 10/23/2015 - 09:24 | 6702199 Bank_sters
Bank_sters's picture

Mr. Calculus, 

I concur.  The exponential function demands it.  The conclusion that Yellen will now raise rates is satire, I guess.  If the Fed were to raise  the ecb, australia, and china eased, the dollar  would rocket higher.   The impact on emerging markets, exports, etc would be catastrophic.   With that said, we are already in a catastrophic situation.   

 

Catastrophy x Catastrophy/crooks, murders, liars, sociopaths, banana republic=FUBAR

I'll send this to Larry Summers to get published.

 

I pity the youth...   

Fri, 10/23/2015 - 07:28 | 6701968 Schnitzel
Schnitzel's picture

The S&P is about to achieve it's biggest monthly points gain ever. Let's enjoy this party until it's over and someone has to clean up this mess.

Fri, 10/23/2015 - 07:28 | 6701969 NoDebt
NoDebt's picture

Welcome to the liquidity trap party, China.

Fri, 10/23/2015 - 08:36 | 6702096 Give up. Realit...
Give up. Reality is not scientific nor even mathematical.'s picture

Bingo!  The Chinese communist central bank is telling Chinese citizens, "Don't save your money.  Put it into stocks."  LoL

At the same time the Chinese communist central bank just got through telling its citizens, "Once you put your money into the stock market, you can never sell those stocks."  It's like Hotel California for the Chinese.

"Buy gold," is another obvious message.  Buy gold???  Why not buy a gravel pit and stockpile mountains of pet rocks?

And when Yellen et al find the gumption to raise rates, or more accurately to the point IMO, when Yellen et al finally decide to lower the boom on all the geniuses playing the stock markets and who own gold, well...  Can anyone guess what will happen?

Yellen et al don't want you to buy any more stocks, or any more gold.  They want you to buy real estate and take the foreclosure property burden off all the TBTF banks that have massive portfolios of rotting, moldy, pipe-frozen, copper-stripped, squatter-infested foreclosure properties piled up to their eyeballs.  Why?  Because of the Free Stuff Army of Bernie Sanders and Hillary Clinton...  They're getting restless, reinforcing the notion that the government should let the squatters have the foreclosure properties of the TBTF banks for free.

Possession has an ownership quality all its own when the squatters' place really does need to be condemned...  Can anyone out there give us an update on the Teledo Ohio property market?  Because the whole rust belt was foreclosed ten years ago...  And there's a look at the stark raving mad future of our real estate stock in this country.  Over-taxed shitholes filled with squatters shooting dope.

The TBTF banks want you to pay double full price for their foreclosure properties, even though they've fallen into such incredible disrepair they are not far from being condemned one right after the other.

Can you buy a TBTF foreclosure property in Cincinnatti that has had the bodies of murder victims and drug overdoses found rotting in it?  Sure you can.  With negative interest rates, these properties can be yours in a jiffy!!!  Zero percent down!!!   Just sign on the dotted line and move in.

I'm still all cash.  And I'm not going to shoot until I see the whites of the eyes of the Central Bankers as they push interest rates to 20% and beyond trying to reel in the stimulus abortions they have unleashed.  The free market will have its day again, because the reactionary shit is coming down around the ears of the world's central bankers.  Americans will elect more and more reactionary politicians until the free market breaks out like war.

Fri, 10/23/2015 - 07:28 | 6701970 Bill of Rights
Bill of Rights's picture

So umm about those Microsoft earnings...it cost you 1000 jobs

 

Microsoft has reportedly cut another 1,000 jobs

Fri, 10/23/2015 - 08:22 | 6702078 yogibear
yogibear's picture

All bullish to Wall Street. The BLS will adjust and bury the losses like it always does.

 

Fri, 10/23/2015 - 07:31 | 6701976 taopraxis
taopraxis's picture

Wow, look at gold go. Too bad I only put on a tracer, yesterday. Oh, well...a small position is better than no position.

Fri, 10/23/2015 - 07:33 | 6701978 Panic Mode
Panic Mode's picture

I learned imaginary number at school. I think it's now come to useful for the interest rate.

Fri, 10/23/2015 - 07:33 | 6701979 I AM SULLY
I AM SULLY's picture

"PRINT CHINA! PRINT!"

(print until we all bleed out of our bung-holes from the Monsanto cancer nuggets)

Fri, 10/23/2015 - 07:50 | 6702013 Bunghole
Bunghole's picture

Bloddy assholes arent pretty.

Ask Quadaffi

Fri, 10/23/2015 - 09:03 | 6702203 Bank_sters
Bank_sters's picture

Cancer nuggets. lol   Fightclub rulz.

Fri, 10/23/2015 - 07:36 | 6701985 Panic Mode
Panic Mode's picture

My 2.5% interest chinese bank account now looks lucrative.

Fri, 10/23/2015 - 07:44 | 6702001 FrankieGoesToHo...
FrankieGoesToHollywood's picture

If you read the fine print, the increase in reserve ratio was not actually a restriction on how much they could lend out, but how much a depositor could remove.  Those ratios can be a bitch sometimes.

Fri, 10/23/2015 - 08:07 | 6702044 negative rates
negative rates's picture

It means they can now lend out more money while having less money to back it up.

Fri, 10/23/2015 - 07:36 | 6701987 DavidC
DavidC's picture

Just a thought, are the ECB and PBoC doing this to ENABLE the Fed to raise rates?

DavidC

Fri, 10/23/2015 - 08:11 | 6702053 negative rates
negative rates's picture

They are doing it because the failed fed experiment CAN NOT  raise interest rates and they STILL need more capital to keep their operations going.

Fri, 10/23/2015 - 08:25 | 6702086 back to basics
back to basics's picture

YES, that is precisely why they are doing this because if the FED doesn't raise by 0.25% in 2015 then they lose all credibility and as a consequence their ability to control the markets. It's all central bank collusion to keep the plates spinning yet one more day.

Fri, 10/23/2015 - 07:38 | 6701990 undertow1141
undertow1141's picture

Currency war gets hotter and hotter.

Fri, 10/23/2015 - 07:57 | 6702022 Fukushima Fricassee
Fukushima Fricassee's picture

I'm cool with Gold and silver.

Fri, 10/23/2015 - 08:24 | 6702081 yogibear
yogibear's picture

Currency wars, then real wars.

The people running the show are evil.

Fri, 10/23/2015 - 07:40 | 6701992 papaswamp
papaswamp's picture

Hey, but at least GM is laying off people and cutting a shift.
http://www.autonews.com/article/20151023/OEM01/151029931/gm-to-eliminate...

Thats good for consumers right?

Fri, 10/23/2015 - 07:40 | 6701994 Goggles Pisano
Goggles Pisano's picture

It's an orgy..................and we weren't invited.

Fri, 10/23/2015 - 07:41 | 6701995 buzzsaw99
buzzsaw99's picture

See how they smile like pigs in a sty, see how they snied...

I am the walrus, goo goo g' joob bitchez

Fri, 10/23/2015 - 07:42 | 6701997 andypaps28
andypaps28's picture

This actually makes a Fed rate hike more unlikely in December or ever. The general commentary is wrong about stocks having recovered enough to withstand a hike. The problem now is the dramatic divergence in policy between central banks if the FED hikes. This will lead to even greater stresses if they try, leading to too strong a dollar initially before the crippling effects then crush their stock market , world economy and eventually the dollar itself as they would have to back track (not just remove the hike but actually launch QE as the impact would have been so negative.) 

 

Fri, 10/23/2015 - 08:59 | 6702188 DavidC
DavidC's picture

The paradox is that the stock market needs tempering but if the Fed raises rates then the dollar becomes even stronger than it is now. But if the Fed wants to take some of the heat out of the dollar's rise they can't raise rates, which makes the stock market go even higher.

The Fed is trapped. And it's its own doing. And it deserves everything that is coming to it.

DavidC

Fri, 10/23/2015 - 07:42 | 6701998 ross81
ross81's picture

MOAR DRUGZ!

Fri, 10/23/2015 - 07:43 | 6702000 taopraxis
taopraxis's picture

Monetary intervention is a drug and the market is addicted. The patterns associated with addiction describe the patterns associated with central bank of juicing the market. Drugs relieve pain and make people happy, short term, but the problem with drugs is that one gradually develops tolerance to their effects, i.e., the drugs stop working. So, people up the dose to get the high and at that point the addiction process is underway. Taking away the drug brings back all of the original pain plus the rebound-induced withdrawal illness. Not fun, so back on the drug...ever moar. Eventually the ratio of the effective dose to the lethal dose will approach 1.0. Death by overdose is generally the result. The market is on that road and it is not a happy sight.

Fri, 10/23/2015 - 07:54 | 6702018 Global Hunter
Global Hunter's picture

thumbs up and agree but the drug taker uses to escape the hell that his/her life has become, monetary intervention and all its side effects is the main cause of that hell that drug users are trying to escape from.

Fri, 10/23/2015 - 09:22 | 6702286 brada1013567
brada1013567's picture

Still short?

Fri, 10/23/2015 - 07:45 | 6702002 pachanguero
pachanguero's picture

You Haters! It's rainbows and unicorns with rivers of candy!

Party on people!

Fri, 10/23/2015 - 07:46 | 6702004 WinstonWolfe
WinstonWolfe's picture

They won't hike in December. Lower interest rate in China means higher inflation in china and therefore more competitive exports than US. In order for US to compete, it has to ease too. Otherwise all the growth will occur in China. 

Fri, 10/23/2015 - 07:46 | 6702005 kowalli
kowalli's picture

Joyflation

Fri, 10/23/2015 - 07:47 | 6702007 CosmicDebris
CosmicDebris's picture

Let the insanity continue. Why not. Keep stackin' and keep kickin'.

Fri, 10/23/2015 - 07:48 | 6702009 gmak
gmak's picture

Algos have done their bit. Now gravity takes over. After all, what does this really do when the banks are reeling from non-performing loans? Any borrowing going on in China now is being used to get capital out of the country.

Sell the Rip (STFR)

Fri, 10/23/2015 - 09:19 | 6702270 herkomilchen
herkomilchen's picture

Except the levitation continues by the day.  And is disturbingly gravity-defying.

Fri, 10/23/2015 - 07:51 | 6702014 rockmanlinux
rockmanlinux's picture

They all ease and somehow you feel its going to make us consider raising rates?  Are you out of your mind?  If anything we flirt with NIRP or QE4.  Deflation is what's coming, and we'll "want" (not me) to try to inflate us out of deflation not put gas on the deflation.

Am I taking taking crazy pills?

Fri, 10/23/2015 - 07:51 | 6702015 peterk
peterk's picture

CREDIT CRUNCH on the way for Australia. Banks here raised rates independantly of the RBA.

The RBA  and  or reserve banks may eep the OFFICIAL RATE low and lower, but the REAL WORLD in these low saving rate  economies will  have ras in the market place go  HIGHER.

THE worlds reserve banks ar eliving in their own little fantasy.

Sooner rather than later the deviation betwen  these will result ina liquifity crunch and/or a currency crisis.

At the end of the day, ALL ECONOMIES need savings and capital to function.

REAL SAVINGS, REAL CAPITAL.

A LEHMAN brothers momet is  coming, as i said te aussie banks already raised rates independantly, they can see the credit crunch, they cant source the money they need at these low rates.

Fri, 10/23/2015 - 08:00 | 6702026 Calculus99
Calculus99's picture

Check this one out. 

Uber driver day trading while working the roads!

https://twitter.com/jeffullrich/status/657246860030124032

Fri, 10/23/2015 - 08:05 | 6702038 VinceFostersGhost
VinceFostersGhost's picture

 

 

So simple.....an Uber driver could do it.

Fri, 10/23/2015 - 08:09 | 6702046 Impoverished Ps...
Impoverished Psychologist's picture

We should commoditise him and sell bonds in him. 

PONZIGEDDON!

Fri, 10/23/2015 - 08:11 | 6702054 Dogspurt
Dogspurt's picture

What happens when the PBOC run out of rate cut room?

Fri, 10/23/2015 - 08:13 | 6702057 Mr. Bones
Mr. Bones's picture

Here I am suffering under the misapprehension that you take away the punch bowl when everything is rainbows and unicorns.

Fri, 10/23/2015 - 08:15 | 6702058 Ouagadoudou
Ouagadoudou's picture

Why a FED increase ? There won't be no increase, ever, nowhere in DM 

Fri, 10/23/2015 - 08:17 | 6702064 wizteknet
wizteknet's picture

sweated my ass off

Fri, 10/23/2015 - 08:19 | 6702066 polo007
polo007's picture

The Federal Reserve Bank of San Francisco published a working paper this month, "Measuring the Natural Rate of Interest Redux," in which it introduced the potential for using both negative short-end rates (NIRP) coupled with another round of quantitative easing (QE) focused at the long end, as a response to the next recession.
 
http://www.frbsf.org/economic-research/files/wp2015-16.pdf
 
Thomas Laubach
 
Board of Governors of the Federal Reserve System
 
and
 
John C. Williams
 
Federal Reserve Bank of San Francisco
 
October 14, 2015
 
Abstract
 
Persistently low real interest rates have prompted the question whether low interest rates are here to stay. This essay assesses the empirical evidence regarding the natural rate of interest in the United States using the Laubach-Williams model. Since the start of the Great Recession, the estimated natural rate of interest fell sharply and shows no sign of recovering. These results are robust to alternative model specifications. If the natural rate remains low, future episodes of hitting the zero lower bound are likely to be frequent and long-lasting. In addition, uncertainty about the natural rate argues for policy approaches that are more robust to mismeasurement of natural rates.

Fri, 10/23/2015 - 08:20 | 6702075 idontcare
idontcare's picture

CNBC is getting as boring as mainstream porn these days.  Is there anything new under the sun?

Fri, 10/23/2015 - 08:28 | 6702093 Seasmoke
Seasmoke's picture

Mr. Yellen could always just belch into the microphone and walk off the stage. That should get Yellen into 2016. But raise rates. Ha ha. No way. Sure seems like China is pushing Yellen.

Fri, 10/23/2015 - 08:32 | 6702109 Monetas
Monetas's picture

A "Basis Point" is 1/100 of a red pussy hair ?

Fri, 10/23/2015 - 08:32 | 6702112 gcjohns1971
gcjohns1971's picture

These activities are fundamentally incompatible with any supposed plan to move towards a Gold-backed Yuan, and represent the polar opposite of hard inflexible currency.

Fri, 10/23/2015 - 08:34 | 6702115 yogibear
yogibear's picture

"Potential for using both negative short-end rates (NIRP) coupled with another round of quantitative easing (QE) focused at the long end, as a response to the next recession."

Yep, that's their plan.

The same but more. The Fed is in a hole and digging itself deeper with money larger amounts of money non-productive, wealth transferring printing and debt.

Impoverishing the 99%.

Fri, 10/23/2015 - 08:36 | 6702118 ILike2Watch
ILike2Watch's picture

The cake, the bakery and the baker are all a lie....

 

Nothing will change for the worse and the happiness "charade" will continue while the "puppets" are in power. Should Bernie or Trump ever take over in the good old USSA then and only then will we see the fuse lit, the "present" passed, and the finger pointing followed by "look what he did! It's all his fault" start. Fake it till you make it! 

Good old Vlad though is trying to make it happen sooner (let's all hope he can.....)

Fri, 10/23/2015 - 08:48 | 6702147 madbraz
madbraz's picture

Microsoft "earnings beat" is perhaps the most ridiculous effort on the part of the MSM to tout garbage as gold.  revenues down 18% YOY apparently is great news.

 

the market seized to exist in 2012 - the corrupt gang took over.  each day that passes by there is less of a chance that it could be saved and once again become an engine of wealth creation that people put their eggs in - it's over. 

Fri, 10/23/2015 - 08:58 | 6702156 gcjohns1971
gcjohns1971's picture

If the Fed and ECB were to raise interest rates then they will have a currency crisis caused by a deflationary debt-spiral.  Because not just banking paper but also the currency itself has no real collateral.  Rather than stabilizing once the banks have collapsed, this will equally affect their currencies - hence my prediction of a currency crisis.

The fact is that if the real economy were able to service the accumulated debt which backs the currency, then we would not be having such out-sized and exponentially growing deficits and government debt.  Inasmuchas we do, and they are persistent, it is an unequivocal sign that there is a deflationary spiral in progress, which the monetary authorities are attempting to offset by means of unsterilized (and likely unpublicized) monetary inflation.

 

Alternatively, if the Fed or ECB (or any other major Central Bank) were to attempt to inflate away these debts using their current currency creation paradigms (debt-based) they will fail.  They will fail because that system requires exponential increases in debt burden to back algebraic increases in monetary base.  THAT IS WHY DEBTS HAVE GONE PARABOLIC IN THE LAST 8 YEARS.   To the extent they are effective in the attempt, they will induce a preference for real goods over rapidly depreciating currency, which ends in hyperinflation, retirement of debt, and then deflation.  Nor can non-export economies, nor reserve currencies, whose every move induces a feed-back loop in the non-reserve currencies, expect to be sustained in devaluation by carry-trades as the Japanese Yen has done to slow and extend the decay over decades.

Shortly the inflationary route also leads to a currency crisis.

Another alternative is to separate assets into a 'Good Bank' and a 'Bad Bank' ...and then intentionally puncture the 'Bad Bank'.   Yet the legacy of globalism and a globally integrated collateral-free monetary system makes it impossible to isolate a 'Good Bank' from the deflationary assets of the 'Bad Bank'...primarily because it is not the owners of the debt that are the problem, but the currency itself.   This route simply will result in huge monetary flows from here to there and back again as the elephants search for a safe repose for their wealth.   

If your wealth is based upon promises of payment, which are fundamentally and intentionally made unpayable by the very design of the monetary system, there is no way to preserve it.  PERIOD.

There is one, and only one way, to salvage what can be salvaged...but this ox gores the politically and financially powerful.  The one way?  Currencies (or a single currency that his widely available) MUST gain a hard-asset (physical commodity) backing.  Physical...because it cannot then disappear due to an accounting transaction, but only change hands.  Commodity, because finished products can only be valued by a market of relative needs and wants...And you can't have that without a unit of measure to serve as numeraire.  Hence, the numeraire must be a commodity, not a finished product.

Will those who will be gored by the only course available be capable of seeing that this course in fact gores them, and everyone else least?

I have my doubts.  By all accounts many of them do not believe the bell tolls also for them, but believe themselves a species apart.

Fri, 10/23/2015 - 08:52 | 6702158 Able Ape
Able Ape's picture

Are there any intelligent adults in the house?....

Fri, 10/23/2015 - 09:12 | 6702247 MFL8240
MFL8240's picture

Hard to believe these games anymore.  

Fri, 10/23/2015 - 09:29 | 6702288 PrimalScream
PrimalScream's picture

YAWN.

Just one more day ... with TOTAL LIES from the Global Financial System.

Everybody knows that China is in serious trouble.  Why do you think that their own millionaires are desperately trying to get their assets OUT OF CHINA by any means possible?

You know what's interesting about the world today?  There is no such thing as a "good bank".  There isn't even a good Central Bank any more.  It's really just a question of whether 'your bank' happens to be Kinda Bad .... or Totally Toxic.

YAWN.

Fri, 10/23/2015 - 23:21 | 6705402 hedgiex
hedgiex's picture

China's real economy is decelerating faster than expected, hence this prop for their SOEs. Decisons not taken lightly as the trade-off is in the currency (RMB). Watch for more volatility in this space with token defenses. They will let it go. It is self defense not currency war as war is initiated out of strength. Pulling down Asia EM currencies is the bonus.

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