Fed's Kashkari Responds To Zero Hedge: "A Market Drop Is Unlikely To Trigger A Crisis"

Tyler Durden's picture

Former Goldmanite and current Minneapolis Fed president, Neel Kashkari, conducted another #AskNeel session on Twitter where the dovish FOMC voter (he was the only one to dissent in last week's rate hike decision) received numerous question. Among them was the following one from Zero Hedge:

His response:

At this point we would like to "timestamp" Kashkari's claim that a "stock market drop is unlikely to trigger a crisis"

It was not clear just how the Fed president separates a market crash from "financial instability", but Kashkari's response that the Fed is not concerned about the level of the S&P500, and instead is more focused on comprehensive market stability, is not being taken well by the market which has continued to sell off as Kashkari responds to further questions, among which the following exchanges:

In response to a question about rising inflation, Kashkari said he would tolerate 2.3% inflation for as long as U.S. has had below-target inflation, “if we really believe 2% is a target. That is what a target means" and adds that “Not sure if my colleagues wld really buy into that however." We wonder how that question would look like if instead 2.3% inflation one used 3.6%, which is the current true level of inflation according to PriceStats. At least the Fed has been polite enough to advise America it will tolerate a material "overshoot" in its inflation target.

When asked about the two latest rate increases, he said that “data didn’t support a hike. Data basically hasn’t changed. Moving sideways rather than toward dual mandate.”

He also said that he would like to see plan on balance sheet normalization soon, adding: “I would prefer to see it before we increase the federal funds rate again” and added that the balance sheet “needs to grow as economy and demand for dollars grows. We will shrink but not to 2006 levels.”

In shor, Kashkarhi - who allegedly does not care about the level of the  S&P500 - is willing to risk a market crash and a Fed balance sheet-driven bond tantrum. Or, to paraphrase Richard Breslow, "The Fed Is Making This Up As They Go Along""

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LawsofPhysics's picture

He is in the club, he knows damn well there is no market for true price discovery!!!

Fuck em, he will make good fertillizer soon enough.

Hitlery_4_Dictator's picture

These scumsuckers offer nothing of value to society.  

Looney's picture


Kashkari is a dickless dickhead.  ;-)


ParkAveFlasher's picture

Notice he didn't answer the question, but made an imperative: care about something else..

They call that "suggestion".

American Psycho's picture

In true Fed fashion, he should have said, "we are data dependent."

nope-1004's picture

What a liar.  Credentials for being a white collar criminal don't exist.


Pinto Currency's picture

Kashkari: actually it's the popping of the collosal bond market bubble we at the Fed have blown that will bring collapse.

manofthenorth's picture
"A Market Drop Is Unlikely To Trigger A Crisis"

That is why there is/was TARP, QE1,QE2, OPERATION TWIST,FOMO, PPT,, GOLD POOL etc.,etc.,etc.

Pladizow's picture

He's right - Its a crash in the bond markets that will create a crisis!

jcaz's picture

Poor Neel- all these years of being set up as the patsy, still hasn't figured it out......

Arnold's picture

Yet, contrarian is what we as a group do.
Like herding cats.
Perhaps our only common asset.

Arnold's picture

Speaking of asset (derivatives).....

Yep bond bombs, but it so intertwined it will be a hard unwind.

hedgeless_horseman's picture


Forget crisis.

We need a revolution...

Marfa Update: Project Mayhem homework assignment



If Americans could only feel the pain of paying taxes with cash, each and every paycheck, instead of the invisible hand withholding electronic funds, then there would soon be a revolution.




Luc X. Ifer's picture

Congrats to 0hedge for managing to get a public, in the open reaction from the top cattle farmers, if they deemed it worthy it means something is really bothering them.

remain calm's picture

He didn't define crisis 10% palms get sweaty. 20% he needs to check his draws not sure if he made a mess, probably soiled. 50% full blown heart attack.

TheRideNeverEnds's picture

Hahaha 20%!?

In an index? Never gonna see that again.

The only "crisis" here would be not buying enough of this dip before we reverse to new all time highs.

runningman18's picture

LMAO!  Can I quote you on that this summer? 

El Oregonian's picture

What a load. Cash'nCurrie [favor], you sir, are either a complete idiot (which I find it hard to believe), or a complete shill (which I tend to believe). Go blow smoke up somebody else's skirt.

Bastiat's picture

2008:  "Printing $Trillions to bail out the reckless, irresponsible, racketeering, price fixing, money laundering, uber leveraged, derivative infected, systemically fraudulent TBTF banksters is unlikely to cause a crisis but rather is likely to suck the blood out of the economy for the next 100 years.  Honest!"

Uchtdorf's picture

Thanks. That needed to be said. Very clear, concise and coherent.

All Risk No Reward's picture

The economic collapse is part of the equation.  Of course, the people who orchestrate this treason want to pretend they are clueless about it.  Sun Tzu said to "pretend inferiority."

“The new law will create inflation whenever the trusts want inflation. From now on depressions will be scientifically created.”
~Congressman Charles A. Lindbergh, after the passage of the Federal Reserve act 1913

The debt-money bubble creates the assets that the Debt-Money Monopolists steal during the debt-money bubble collapse.


scrappy's picture

Yes, Armstrong covers it well. http://www.armstr4ongeconomics.com

So does Gordon T Long. The EU first, then us.


Does anyone on this board think Cash and Carry looks like that guy in The MUMMY?

clymer's picture

No one questions, mr Kashkari that you're working hard. Our question ..is who you're working for.



froze25's picture

Good old Ron Paul, I saw that live on CSPAN.

Ms. Erable's picture

...because devaluation of bankster 'reserve' asset classes won't make them technically insolvent (as opposed to reality, in which they are insolvent), right?

manofthenorth's picture

The FED has been insolvent since 1971.

Erek's picture

Just think of 1929 and 1933 for starters.

Joe Sichs Pach's picture

Kreepskari says "it's different this time"

CPL's picture

It is.  The market just won't ever come back given the highlights of the kabuki theatre being presented and like he says, you need to stick handle local affairs.  Right now the opportunity is to make sure you've got trade between houses happening so you don't end up with horrible gaps in what your community can offer.  There are so many other issues people should be reviewing, the stock market built of jew confetti isn't one of them.  It simply wasn't that well built to begin with and once the snow starts to fly priorities will shift.  That shift includes:

  • Capital recovery, not cost recovery, capital recovery.  Big difference in defining what capital is during triage situations over costs.  Some of you can already see this in your local areas.
  • Revestment of where communities are using energy (if they have energy to use).  Not to point something out but oil isn't a given right, it's a commodity that's bartered for by currency that isn't doing that well.
  • Itemize what you've got on hand, because that might be all you've got on hand.
  • Keep the head count manageable.  Get used to the idea of people dying like flies and breeding like rabbits.  Works better that way long term, just like how nature manages things.  If a community attempts to force some point of distinction (ie whites only, religious only, whatever cockeyed bullshit), you can count on one thing happening fast.  Extinction, strife, misery and some incredibly questionable practices regarding governance.  Only way to hedge it is keep educational needs baselined to your community niche and avoid micro-managing.
  • Medical care.  Most of all those pills that get shipped to keep most everyone alive are deeply dependent on supply arrangements from multiple locations distributed all over the map.  Most pharmacies do not stockpile.  Be aware of that fact.  If the pills stop, the turnip like demographics everyone is accustomed to turn back into a pyramid over the course of two years.  It takes very little to turn the pramid right side up and put the average lifespans of people back into the 0-40 age range.
  • Dealing with the dead.  Here's the issue that most people aren't really wanting to deal with, dead bodies.  As mentioned if the pharma distribution stops cold or is interupted, there simply are not enough hands that will be trained to deal with the disposal of...check population distribution...50+% of the population that will most likely need to be managed.  In my area, 68% of the population is over 50, 100% of them take some form of medication or another to simply live.  Between heart medication, diabetes medication, liver/kidney treatments, or happy pills to stop them from blowing their brains out.  Once those get cut, my estimate is two years and the average age of people here will go from 57 to 24.  It's a big difference in social dynamics and community services required all related to pharmacy medication disruptions.

He is correct in saying 'it's different but the same'.  The difference is understanding the landscape will change by means of demographics and the ability to offer services in a community.  For the moment the game of triage continues and most of the proxies for their areas are completely under prepared for the shifting winds of demographics.  The effect is one of scale, the stock market is so meaningless and inconsequential it's laughable to offer it any energy for recovery.  The USA is DOA right now given the above notes.  Europe is DOA as well.  The minor theatre presented is mostly a litmus test to see if someone really gives a shit about jew confetti or comprehend what real operating capital is.  Again, currency and capital are two different things by use and presentation.

And he's not a jew btw.  He's one of the dragon houses, their belief system is way weirder than a bunch of gold mining slaves built by a psychopath by the name of Galzu.  His people's house has been through this before.  Just like lots of other houses have.  Best advice to offer is look at how your ancestors did it, if they didn't figure it out then none of you would be here right now. 

(And no they don't eat babies, they barely breed and that's part of their problem right now.  They are looking for compatible 'dragons' to freshen up their gene pool since humans went apeshit and slaughtered a lot of their people.)

cue in cue's picture
cue in cue (not verified) CPL Mar 21, 2017 9:22 PM

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ThirteenthFloor's picture

One mans 'drop' is another mans 'crisis'.

When your on the inside at the FOMC, you can change bets accordingly, just like Bernanke, you can 'protect' the FOMC investment in AIG with a Sunday night bailout, or a crash of Lehman to save GS. Or like Greenspan buying mortgages in late '06, when publically that was essentially denied.

jus_lite_reading's picture

He does look circumcised :)

Mark to market fantasy, the Fed's specialty

GUS100CORRINA's picture

Really ... No Crisis!!! Interesting!!

Wait until that roughly 400 BILLION of Margin Debt KICKS IN.

Folks ... I believe we have not seen anything yet!

Another 5% or so should about do it!!

Not even the PPT is going to be able to stop the cascade if it gets rolling!!

steve2241's picture

And a Bezos imitator, to boot!

ejmoosa's picture

What are the odds a Fed President has the last name of kashkari?  


You cannot make this stuff up.

AGuy's picture

"Kashkari is a dickless dickhead. ;-)"

I wouldn't be so quick to come to that conclusion. He is the only Fed Guy that is responding to questions, unlike the rest of the club, that lives in there own private cloud city.

I think he is one of the few Fed heads that is willing to admit there are serious problems, and probably doesn't want the Fed to trigger another crisis.

Perhaps its best not to piss him off so we have at least one person in the Fed that has a foot on the ground, and can clue the rest of us stuck on the ground.

GotGalt's picture

AGuy - you might be right, but remember that this is the guy who was charged with heading up the TARP bailout program in 2009, the greatest thievery that has ever taken place in the USA by total amount.  So yeah, I'm more on the side of this guys a dickless dickhead, which by the way is actually a pretty clever play on words, I like it.

StychoKiller's picture

All I can say is:  "IMHOTEP!"

TeamDepends's picture

Most equate his face with the crash of '08, so seeing the Goldman gnome now does not inspire confidence.

Seasmoke's picture

2008 indeed. I'm just waiting for a Tweet from Little Timmy.

BorisTheBlade's picture

Mr '700 Billion: Nice Round Number'.

In Washington, he used his BlackBerry to determine the bailout sum presented to Congress. His arithmetic: "We have $11 trillion residential mortgages, $3 trillion commercial mortgages. Total $14 trillion. Five percent of that is $700 billion. A nice round number."

Can't argue there: nice, round, number.

HRClinton's picture

In the long run, we all make for good fertilizer. Even libertarians.

In the meantime...

Kashkari is right, and ZH is wrong. As usual. In spite of its daily doom charts, running 8 years straight. I know broken clocks that work better. 

LawsofPhysics's picture

I don't think you understand the exponential equations now at work or the difference between liquidiity and solvency...

Good luck tool.

silverserfer's picture

H-Rod and most liberals or fake liberal troll whatever it is think linear and ceritanly dont question the concept of money as it exists today. Fungible minds and fungble assests are just fine with them as long as the card isint delcined.

Everybodys All American's picture

Kashkari is a globalist cock working for the status quo which is out to sell off the American assets just like they have accomplished in all debtor nations. Fuck him. He is no friend of our country.

PlayMoney's picture

Kash must be preparing for a 2nd career as a comedian

Hammer823's picture

You mean after a 3,000 point rally on fairy dust and unicorn farts the market might actual give up a few hundred points on fundamentals. The horror. 

jmack's picture

Just post that quote at the top of web site, cuz it is the epitomy of "famous last words".



top of the market at 9am central on 3.21.17?  we shall see.


SloMoe's picture

Calamari for lunch?