Yellen Says Negative Rates On The Table "If Outlook Worsened"

Tyler Durden's picture




 

As the market now diligently calculates the suddenly surging odds of a December rate hike, here's Yellen with a preview of what will happen once the rate hike cycle is aborted...

  • YELLEN SAYS IF OUTLOOK WORSENED FED MIGHT WEIGH NEGATIVE RATES
  • YELLEN SAYS NEGATIVE RATES COULD HELP ENCOURAGE BANKS TO LEND

... just as it was aborted in Japan in August of 2000 when the BOJ also decided to send a signal how much stronger the economy is by hiking 25 bps, only to cut 7 months later and to proceed to monetize not only all net Japanese debt issuance a decade later, but to hold half of all equity ETFs.

The good news:

  • YELLEN SAYS SHE DOESN'T SEE NEED FOR NEGATIVE RATES NOW
  • YELLEN SAYS FED SEES ECONOMY ON STEADY PATH OF IMPROVEMENT

Because when have the Fed's forecasts before ever been wrong.

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Wed, 11/04/2015 - 13:26 | 6749186 Nid
Nid's picture

Worsened......SPX close below 2000; or perhaps more of this?

http://hosted.ap.org/dynamic/stories/U/US_TARGET_STORE_CLOSINGS?SITE=AP&...

 

Wed, 11/04/2015 - 13:28 | 6749191 knukles
knukles's picture

You go girl!
It's moments like these where I get a bizarre urge to yank all my clothes off, like a crazy person.  Now I understand that they're not the crazies!

Wed, 11/04/2015 - 13:36 | 6749227 bigdumbnugly
bigdumbnugly's picture

but the other side of her mouth - the droopy side - was just talking about raising rates a minute ago...

i guess that means when you average that out they'll stay where they are now.

Wed, 11/04/2015 - 13:38 | 6749251 mtndds
mtndds's picture

Wow.  The bitch cant decide to raise rates or go negative.  She has no clue whats going on.

Wed, 11/04/2015 - 13:45 | 6749286 Shocker
Shocker's picture

Amazing we are even talking about negative rates.

This economy... who knows what is going to happen

Layoff / Closing List: http://www.dailyjobcuts.com

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Wed, 11/04/2015 - 13:47 | 6749301 Squid Viscous
Squid Viscous's picture

i called it weeks ago when they were talking it up on Bloomberg radio... just like any other reptile these kikes have to put out "feelers" in advance of any big move

Wed, 11/04/2015 - 13:51 | 6749319 two hoots
two hoots's picture

 

Yellen’s rate rise comments sent the markets  lower, she flips to NIRP to attempt to change the direction.

 

Wed, 11/04/2015 - 14:04 | 6749377 onewayticket2
onewayticket2's picture

Welcome to central planning

Wed, 11/04/2015 - 14:25 | 6749458 JRobby
JRobby's picture

:. We Will Have Negative Rates

Your wish is granted Janet! Long Live Jambi!

Wed, 11/04/2015 - 14:56 | 6749571 bigkahuna
bigkahuna's picture

This is the only statement the fed has made that is semi believable "negative rates"..

Wed, 11/04/2015 - 15:54 | 6749876 Tarzan
Tarzan's picture

A believable statement because negative interest on a $20 Trillion debt has such a nice ring to it....

Wake up! 

We're barrowing to make payments on barrowed money!

We cant pay our debts, let alone interest on it!

Wed, 11/04/2015 - 16:17 | 6749952 Captain Debtcrash
Captain Debtcrash's picture

How do you go from raising rates in one breath to negative rates in the next.  Easy, you know you are going to raise rates and that is going to cause the economy and markets to tank.  This will give you the cover to ban cash, push rates significantly negative, or the E Dollar.  Never let a good crisis go to waste after all. 

Wed, 11/04/2015 - 17:07 | 6750174 Tarzan
Tarzan's picture

The markets will fall, but the destructive event, triggering a market crash, will be US defaulting on it's debt if interest rises...

There will be negative rates as a natural function of passing an unlimited debt ceiling

Most likely, purposely!

They know the debt is unplayable.

The rest of the world is waking up to this fact.

US Default is inevitable,

and no Politician nor Magician can avoid stop it!

Wed, 11/04/2015 - 18:20 | 6750596 NihilistZero
NihilistZero's picture

With the FED holding half of treasuries outstanding I think they have A LOT of room for accounting gimmicks if there is some force that prompts a rate change.  The "interest" we pay to ourselves is through the FED held debt notes that is deposited to the treasury.  It is likely more than half of the interest paid on the total debt as post operation twist the FED should be sitting on quite a bit of the longer term debt that was issued pre ZIRP.

Wed, 11/04/2015 - 14:34 | 6749492 herkomilchen
herkomilchen's picture

Didn't work because the market only trades what it sees right in front of it.  2-3 months ahead.

Wed, 11/04/2015 - 13:44 | 6749290 manofthenorth
manofthenorth's picture

Oh they have a clue what is going on, they are the ring masters of the circus.

What they are lacking, completely, is.....

CREDIBILITY !!!!!

Wed, 11/04/2015 - 14:02 | 6749370 Bring the Gold
Bring the Gold's picture

Come on man. I get sick of the Keystone Cops meme. These people know exactly what they are doing and that's paving the way for a cashless digital global currency. Call it SDR or Bancor hardly matters. They will link it to gold and maybe some basket of currencies if any are left.

Wed, 11/04/2015 - 14:10 | 6749397 Latitude25
Latitude25's picture

You didn't get the message that gold is a pet rock?

Wed, 11/04/2015 - 15:33 | 6749771 Bring the Gold
Bring the Gold's picture

Apparently neither did the people of India, China and the rest of Asia or most of the worlds central banks. Funny thing that. Central banks have a rather impressive collection or dare I say hoard of "Pet Rocks".

Wed, 11/04/2015 - 16:27 | 6750006 1033eruth
1033eruth's picture

Link it to gold?  What the hell for when inflating the money supply is the only thing they know how to do?  But I agree, of course they KNOW what they are doing.  George Carlin said it best.

Wed, 11/04/2015 - 13:38 | 6749253 Bring the Gold
Bring the Gold's picture

I have to admit I'm SUPER curious how regular people, in particular the elderly on fixed incomes, will react to negative rates. Something has to wake up the populace to the madness. Got gold, silver? Bitcoin if you trust it.

Wed, 11/04/2015 - 14:00 | 6749359 two hoots
two hoots's picture

 

If I notice a loss in my savings that I did not approve I will call and report the theft.  Everyone should do this on an announced day.

 

Wed, 11/04/2015 - 14:04 | 6749378 Bring the Gold
Bring the Gold's picture

Hmm, I could see that being an effective media stunt to bring attention to this. Someone should roll that out. #NegativeRatesAreTheft

Wed, 11/04/2015 - 18:38 | 6750713 FrankieGoesToHo...
FrankieGoesToHollywood's picture

Who will you call?  The people on the other end of the line work for the banks.

Wed, 11/04/2015 - 14:04 | 6749361 two hoots
two hoots's picture

 

I’ll call twice???

  

 

 

Wed, 11/04/2015 - 15:03 | 6749602 bigkahuna
bigkahuna's picture

I will call as well, right after I finish withdrawing any cash I have all in nickles. All 10 cents of it.

Wed, 11/04/2015 - 14:30 | 6749481 JRobby
JRobby's picture

You are?

If you were holding on by your fingernails with SS & rates at 4% to 6%, then you are dead now (selling shit (stocks) cashing out (annuities and other financial garbage) homes, boats, cars etc.)

 

PS: don't forget to observe the operational rules when multiple parenthesis are used. Thank you.

Wed, 11/04/2015 - 14:41 | 6749515 twh99
twh99's picture

You forgot real estate, art, other hard assets and especially cash (stuffed in a mattress.

Wed, 11/04/2015 - 17:38 | 6750361 Nunyadambizness
Nunyadambizness's picture

Cash in a mattress isn't worth shit when the cash isn't honored.  Think Zimbabwe and Weimar Germany.

Wed, 11/04/2015 - 18:28 | 6750579 Not Goldman Sachs
Not Goldman Sachs's picture

My official reply from AARP when i asked their view of Fedpolicy....."nothing, we do not lobby them as they are independent."

 

The sheeple will baaaaaah. You will never be more powerful as you are now.

Wed, 11/04/2015 - 13:42 | 6749269 schnydz
schnydz's picture

I can be ok with that. Imagine a market where fed rates are forever fixed. And actually force the US gov to look at its own fiscal policy for once rather than just kick the can. 

Wed, 11/04/2015 - 13:42 | 6749279 Bastiat
Bastiat's picture

With that kind of thinking and a few graph cartoons you could get a Phd in Economics!

Wed, 11/04/2015 - 13:46 | 6749285 Shocker
Shocker's picture

:-|

Wed, 11/04/2015 - 13:37 | 6749249 A Nanny Moose
A Nanny Moose's picture

The patients are on the loose, and they are running the insane assylum.

Wed, 11/04/2015 - 14:00 | 6749357 Bring the Gold
Bring the Gold's picture

That's really unfair to Insane Asylees.

Wed, 11/04/2015 - 13:57 | 6749341 Wookie
Wookie's picture

She can keep babbling on all she wants and say they are going to raise rates, then go to NIRP.....fact is they won't change shit come December. 

Wed, 11/04/2015 - 20:21 | 6751330 PlayMoney
PlayMoney's picture

yep lets raise dem rates right before christmas. Blow up dem derivates just in tme for christmas

Wed, 11/04/2015 - 22:30 | 6751947 rubiconsolutions
rubiconsolutions's picture

Let me see if I have this right. First they debase the currency through the built in mechanism of fractional reserve banking. Then they want to charge people to deposit this debased currency into their care by way of negative rates. Kind of economic double jeopardy. Fuck 'em, I'll stick the fiat under the mattress and bury the PM where nobody can find it.

Wed, 11/04/2015 - 13:27 | 6749188 Dr. Engali
Dr. Engali's picture

They can pretend all they want, but in a debt based monetary system where debt grows exponentially NIRP in one form or another is inevitable.

Wed, 11/04/2015 - 13:35 | 6749237 Bay of Pigs
Bay of Pigs's picture

Yet the headline here just this morning was all about the "hawkish" FED.

wtf...

Wed, 11/04/2015 - 13:40 | 6749262 LawsofPhysics
LawsofPhysics's picture

until producers of real things can no longer deliver or everyone dumps the underlying currency, yes.  This time it is global Weimar however.

Wed, 11/04/2015 - 13:58 | 6749349 Latitude25
Latitude25's picture

Wasn't the Roman Empire perceived as global at the time?

Wed, 11/04/2015 - 14:07 | 6749389 Bring the Gold
Bring the Gold's picture

And that my friends is the entire point of all this. To roll out the SDR with the IMF or BIS as the white knight of responsible prudent banking. Not like that nasty nationalistic FED and those naughty banks like Goldman and JPM. People will be shocked at the scapegoats for this. All sleight of hand to lend legitimacy to the new global cashless electronic currency system.

Wed, 11/04/2015 - 14:21 | 6749440 LawsofPhysics
LawsofPhysics's picture

Good luck with that as it will still not provide the consumable calories required to maintain the status quo, period.  That's just math and the laws of Nature and physics.

Maybe after WWIII when the population has been sufficiently culled, but that's going to take a while.

Wed, 11/04/2015 - 15:29 | 6749750 Bring the Gold
Bring the Gold's picture

I agree that current energy forms are insufficient and that current population with growth is unsustainable. That said I'm pretty sure what I outlined is the financial part of the plan. As to any incipient genocide I cannot say. I certainly don't put it past them.

Wed, 11/04/2015 - 16:34 | 6750033 Bay of Pigs
Bay of Pigs's picture

The William Dudley at the NYFED works for the BIS. He is central in these NWO and SDR plans. I think you are spot on, and their plan is to kill billions of us via war, starvation and other assorted plagues and man made viruses.

Good times!!!  :/

Wed, 11/04/2015 - 15:14 | 6749668 gatorengineer
gatorengineer's picture

You got it wrong doc. This is a fractional reserve system, at least nominally, the banks go belly up when the rates go negative.  The only cure from here is hyper inflation, you cannot deflate your way out of debt.  You have to inflate your way out.

Wed, 11/04/2015 - 16:33 | 6750030 venturen
venturen's picture

until?

Wed, 11/04/2015 - 22:54 | 6752044 Rearden-Steel
Wed, 11/04/2015 - 13:28 | 6749193 hungrydweller
hungrydweller's picture

I'm turning Japanese, I think I'm turning Japanese, I really think so!

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