This Wasn't Supposed To Happen
Two words - "policy" and "error"
Gold up 3%, Long bonds up 2%, Stocks down 5% since the Fed hiked rates: This was not supposed to happen!
And money markets are not buying what The Fed is selling.
What rate hike? The market is starting to whisper about an imminent rate cut.
What does it say about The Fed when one month after they confidently hike rates (for whatever reason they concocted), the market implies a rate cut is more likely to come next.
And this is what The Fed offers:
- FED'S LACKER: CASE FOR HIGHER INTEREST RATES OUGHT TO BE CLEAR
Actually, not so clear at all, considering the US is now in an industrial recession, although as we joked last night:
What the market needs is an emergency rate hike to boost some more confidence
— zerohedge (@zerohedge) January 7, 2016
And then there was this:
- FED'S LACKER: DON'T ANTICIPATE NEGATIVE INTEREST RATES IN U.S. IN '16
At this point we would show a chart demonstrating the "accuracy" of Fed predictions but by now that would be redundant.
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1) gold dealers will be selling at extreme premiums. The gov will say they are racketeering. Shutting down locall coin shops, and online dealers. Set a few examples by sending a few people to prison.
2) the US will activate their sleeper cells in those countries. And they could selectively default on their debt to those countries and tank their administrations. Apply the screws like in Greece.
3) the same people who follow the income confiscations every year, big vault companies, banks etc. See 1) the weak spot of gold is the dealers/shops. Can't very well keep a coins shop open in that environment. Sure the small guy with 50 ozs in a home safe will be fine, but all investment vehicles will be outlawed. "terrorists use gold for financing" will be a headline.
Mark my words......
Would they really risk a door to door "give me all your pm's" scenario. For some of us, that would be deadly. To the bootstrap trying to take it. Is 7 oz gold and a few hundred silver worth dying for? No. But liberty is.
We'll give 'em a facefull of lead welcome if they kick in the door for ANY reason.
Kicking in the door and social media, there is a mix.
They would have to shut down the internet...we all talk too much these days.
"we all talk too much these days. "
Yes. All talk. Talk, talk, talk talk,.....
No but fascists use harsh examples to enforce compliance. They haul a big name in, maybe a CEO of a gold company, send them to prison. Or trump up charges on a few people and find ties to terror financing, etc etc. Then they send letters to all the people that they have records of buying gold, and they say you must turn over your gold within xyz, or we will press charges, regardless of which Lake you lost your gold in. The threat of prison, or being treated as a terrorist will suffice for most. That's all they need.
I ordered some Silver Buffalo's online recently and they were out. I got an email saying:
"We are out of Silver Buffalo's. Would you like some Australian funnel web spiders instead"
Yikes!
Yes. And send me some radioactive scorpions while you're at it!
Kevin must have received am early wake-up call today. Dow futes have recovered 70 points in less than half an hour.
I want the Fed to hike again. What fun that would be!
Same thing happens when you take away a heroin addict's needle. Who could have seen this coming? Print Baby Print.
Not 'BTFD' but Print The Fuck Up...which will result in it being the equivalent of 'Print The Fuck-Up! For that's exactly what it will be. A Fuck-Up of the first magnitude.
The 'helicopter' tutbines are whining higher in their spin up. The blades are turning. The cargo bays are being loaded with FRNs. Only it won't be Benjie at the stick, but Janet.
FRNs are nice, dollar coins would be better if the copters are headed for wall street
If dropped from a sufficient height, they may serve the same purpose as these
But the big shots are probably in their bunkers, by now. You'd only get the middle management.
"If Stupidity got us into this mess, then why can't it get us out?" - Will Rogers
Substitute Printing for Stupidity and It's All Good.
ppt to the rescue.
Dustin' off the printing presses here boss....
Sum Ting Wong?!
"No, all is well." - Fu Ling Yu [Minister of Propaganda]
Brak Dik Ow!
"The Yuan is a stable currency, worthy of SDR status." - finance minister Oh Fuk Mi.
Yuan I print MOAR?
US will pat themselves on the back and do more share buybacks for their exceptionalism. Then brag about what masters they are.
Slag China all the way to the store and buy their stuff while whining over China devaluation.
Why buy it?
Just steal it.
Yellen and Co. pressed the button on the detonator a month ago. The explosion is happening in slow motion, but the frames may be speeding up, soon, reaching 'real time' in a few days. Enough time for the knowledgeable to dig a PM lined foxhole and duck the shrapnel. Hope everyone here had a shovel...
get ready to btfd. the bottom is in bitchez.
Is reducing with the IOER and interest charged on RRPs really a cut though?
You are saying because they are printing more money to do it, it is not a rate hike?
Don't concur. Rates and money printing are two different things that need not be linked. They could have sold bonds to hike rates then bought Cabbage Patch Kids for $1B each with the proceeds to re-print the money. You would agree this is a rate hike, no? They've basically done something comparable with IOER/RRPs.
My point is that a rate hike isn't a rate hike until the Fed balance sheet is shrunk.
Tylers are foreshadowing a knee jerk rate drop, but rates can't drop if they weren't really raised in the first place.
(funnily what will occur is curtailment of the QE-lite which increased IOER represents).
I don't follow the logic. If supply and demand on the open market prices money +0.25% higher for any reason, that's a rate rise. Sure, the reason is the Fed is printing money to pay for IOER and repos, but the price of money is elevated nevertheless.
That bonds on its balance sheet are at one level or another doesn't mean the price of money isn't what it is.
Just because they previously chose to print money and buy bonds as their method of choice to lower rates doesn't mean they necessarily must unprint money and sell bonds to raise rates. They can, and are using an alternative method. The proof is in the pudding: is money any longer available anywhere < 0.25%? No, it isn't.
https://apps.newyorkfed.org/markets/autorates/fed%20funds
Uh huh. So crunching those numbers, the average fed funds rate in December before the hike was 0.13%. The average fed funds rate after the hike has been 0.35% The difference, the average hike in the Fed Funds rate is 0.22%.
What part of that 0.22% hike are you saying isn't actually a 0.22% hike?
Sorry I was being pedantic regarding your comment that no money could be had for <0.25% (see yesterday's low).
I am having trouble letting go of the necessity for a link between the balance sheet and rates. What is the point of the size of the excess reserves?
Oh, right. Conceded it occassionally dips below 0.25% briefly. However, the chart on that page shows on average the rate hike is in effect and real. So unless there is more to the argument rates have not risen, I'm not seeing that.
There is no point of the reserves right now. They were originally created with the expectation banks would lend them out to increase debt levels to stimulate the economy, but that didn't happen. If the Fed wanted to neutralize excess reserves without unprinting the money by selling assets, it would just alter the reserve ratio. I think the banks that own the Fed are digging the free IOER money though so the Fed is continuing to feed it to them.
The key to letting go of the necessity for a link between the balance sheet and rates is appreciating the Fed can buy any asset it wants with printed money, including assets that don't lower interest rates. Any purchase expands the money (credit) supply in the process. Buying bonds just happens to also distort interest rates lower at the same time, an economic manipulator's two-fer.
Why are we all cheering? We're in the same fucking boat!
This is the epitome of gallows humor. Batten down the hatches and run like hell.
Run to where?
Pssst. I can't tell you.
@bandgap...the problem: Run like hell to where? Where can we hide? When the Fed/Government/Oligarchs push this bad play to the final scene, where can we find safety? In cash? Probably not, as TPTB know it is easy to punish cash hoarders. Gold? We all know how easily that can be outlawed. Even being debt-free has drawbacks now; it may be that the greatest wealth-play in history will be to get leveraged to the teeth, and wait for debt forgiveness. We are all so screwed, may as well get the popcorn and enjoy the show.
Contrary Mary,
Assholes and opinions, right? Out of stocks. Physical gold, physical cash out of the banking system, small amount of cash in the banking system.
Make sure your debt is the unsecured kind. Or have none. House paid off is good in my book. Car(s) too. Non perishable supplies laid up (a year or two depending on what you can afford and have room to store). More jiggy? Guns and Ammo. Guns will trade in some scenarios very well. At least a year storage food is wise in case of any kind of disaster. Seeds. A garden.
It has alll been said here before.
People looking to make money during a crash are missing the point (do that after perhaps). The point is to live through it and have something to start over with. Insurance. The problem that helps cause the crash is everyone looking to profit. Intrinsically, excess profit (or interest) means someone in the system has to lose so there must be defaults (individuals lose) or printing (everyone loses stored value) to deal with it.
Contrary,
the greatest wealthy play in history very well could be to load up on debt, especially now when debt is seen as patriotic in a sick way. My opinion, is to load up on debt and buy bitcoin with it. Where gold can only enable local black markets, Bitcoin can enable international business to continue. It's uncensorable, and you can send it anyone in the world with a wallet.
MsCreant,
Human nature hasn't changed. People always look for profit. The cause is that fiat paper currencies have led to real sources of profit, investing in productive assets,having crowded out by investing in unproductive andv bubble assets.
I agree that people should be trying to preserve capital v build capital, at this time, but that's well known. What's not understood by many yet, is that there is already a parallel economy that they can join, and accomplish all these things and more.
Where is the story about Tom Cotton taking $1 million in bribes from Israel?
Tyler's have a bit of history with AIPAC and their Swiss counterparts.
See the policy on racial discrimination that was added a couple years ago.
If it is not more watertight than a frog's asshole, it won't show up here re: Israel.
pods
The Tylers have been willing to print stories about Israel's treatment of Palestinians...
Who cares about the fucking market? It bloated up because of the Fed in the first place. The rates should have gone up years ago. 0% interest doesn't make an economic recovery. I suppose we'll now get NIRP and morons will praise the action. Without the Fed and .gov meddling we would have had an actual recovery a long time ago.
helicopter cash..is coming - debt forgiveness for college debt? we all know it is coming..the jewish banksters of course will front run it. but the public needs to be fed er FED'd anyway: trillions in banks sitting there not loaned out- that must end or congress might call a hearing.
UE must go negative while labor part goes parabolic..watch and learn padawan.
I could see college debt. That will be the big push from the dems to get votes. Then us that paid their debt will get a certficate with a sucker on it.
College debt looks like a good place to do it...
I remeber they had all these "programs" that were supposed to help folks stay in their houses. The programs in many cases ended up being bullshit, often kicking folks out of their houses anyway and/or giving bankers ways to scam both the bailout, and claim the losses on their books so they did not have to pay taxes on it. I know I have some of this imprecise, but the so called debt forgiveness on student loans will end up being something scamable because the bankers will be the one's writing the legislation and specific rules for it.
Are you kidding? Debt relief for peons? No way.
If it happens it'll be aid to the poor suffering LENDERS, not the borrowers.
The 1% are cashing out of this market. Only stupid people are staying in.
That's why this is exactly what's supposed to happen.
Not really the 1%. The 1% aren't mega wealthy - basically your small business owners etc who might if they are thriving be making a couple hundred thousands dollars a year working 60-hours a week with no vacations and lots of risk.
It's more like the .001%.
They will crash the market then swoop in a buy it up for pennies on the dollar. Real Estate, and everything else of value too.
The "1%" for the most part are hard working people who are on your side and are being destroyed by this crap system. Notice the thousands of small businesses going out of business? These are your 1%'ers
There is an annual classic wooden boat show on Lake Tahoe that brings the best of the best old woodies to the lake for a weekend of show and sharing. it's quite an event, and some of the boats are museum quality restorations. I don't think CD's image is from lake Tahoe, but the point is these old classics are valuable. There's a risk in actually using them.
Some owners take the risk of actually taking their boat out on the lake and running it, and presenting it in the state it was originally intended to be used in. Out on the water, running. These boats are old, and not used very frequently, if at all. Stuff happens.
These two guys took the risk of loosing the boat over enjpoying it in its element. It isn't very low in the water, it's still running, they have it under control. I'm sure they saved a very valuable boat.
Thanks for sharing. That's a neat pic.