• Sprott Money
    05/06/2016 - 06:03
    The US, in its own decline, is showing this same self-destructive tendency. The worse things get, the greater the inclination of the citizenry to say, “Carry on, everything’s fine.”

Complete Cheatsheet For What To Buy Ahead Of QE3

Tyler Durden's picture




 

Fed and/or ECB intervention is coming: whether it is called LSAP, QE x, Nominal GDP targetting, selling Treasury puts, or what have you. A regime that now exists only by central planning intervention, by definition requires ever more central planning intervention to sustain itself, let alone grow further. Furthermore, the banks not only want QE, they need QE. And since central banks serve other banks, not the people it is only a matter of time. Don't believe us? Read anything written by Bill Gross in the past year. So what to do ahead of QE3? Luckily, SocGen has released a complete cheat sheet of not only the dates of the next steps, but what to buy and what to sell ahead of the announcement. In short - one should buy Mortgage Backed Securities, in order to "simply buy MBS before the Fed" - something Bill Gross knows too well and has been hoarding MBS relentlessly as a result, as reported here. More importantly - one should buy gold. Lots of it as "USD debasement restarts." You didn't think the Fed will allow US corporate earnings - the only thing keeping the market alive - to be crushed with a EURUSD that will soon go under 1.20, now did you? And as for crude going to $250 - yes, it may cause huge headaches for regular folks but for banks it means record bonuses, and as a reminder, the Fed works for the banks, not the people, pardon neo-feudal debt slaves...

SocGen on the sequences of events:

Weak Q1 12 GDP and softening inflation pushes the Fed to another round of monetary easing, in 2 steps:

  1. In January, the Fed pledges to keep real rates at 0% until unemployment falls below 7.5% or inflation moves above 3%,
  2. In March, the announcement of another round of QE, concentrated on MBS purchases (c. $600bn over 6 to 8 months)

In table format:

And here are your pair trades: long gold/MBS - short EUR (or USD - we disagree with SocGen that the dollar would benefit from QE3).

Finally, on gold: "Buy Gold, as its price is highly sensitive to US QE as every dollar of QE goes into M0, triggering debasement of the USD. $1900/Oz est. to close the gap with the monetary base increase since July 2007(QE1+QE2)"

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Thu, 01/05/2012 - 18:37 | 2037278 Squishi
Squishi's picture

silver looks best now!

Thu, 01/05/2012 - 18:40 | 2037291 Sudden Debt
Sudden Debt's picture

Yeah!

And if i doesn't go X4 this time, it will go x8 when QE 4 is launched :)

Thu, 01/05/2012 - 19:28 | 2037418 TruthInSunshine
TruthInSunshine's picture
Rudolph and Yukon Strike It Rich

 

 

Does anyone know if Fractional Reserveless Banksters bounce?

 

*Joe Weasenthal & Andrew Ross-Sorking <3 The Bernank

Thu, 01/05/2012 - 19:29 | 2037430 TheSilverJournal
TheSilverJournal's picture

Silver to a min. $1,000 / ounce.

TheSilverJournal.com

Thu, 01/05/2012 - 20:10 | 2037508 nope-1004
Fri, 01/06/2012 - 00:41 | 2038091 VegasRage
VegasRage's picture

That video could only get cheesier if they had played the soundtrack from the movie 2012 where everyone died.

Thu, 01/05/2012 - 20:21 | 2037550 I think I need ...
I think I need to buy a gun's picture

qe 3 isn't coming printing never stopped,,,the reset is coming,,,,,it doesn't matter what a barrel of oil is at,,,,price at the pump will solve all supply demand problems on our own resources,,,,,we are going to have a boom in small cars and motorcycles this year ,,,,,,,

Thu, 01/05/2012 - 22:13 | 2037780 WonderDawg
WonderDawg's picture

That's fucking hilarious.

Thu, 01/05/2012 - 18:54 | 2037346 DoChenRollingBearing
DoChenRollingBearing's picture

For me: Au > (Ag = Pt)  <--- as investments

To be safe and diversified, buy them all!

Thu, 01/05/2012 - 20:28 | 2037569 Miss Expectations
Miss Expectations's picture

Thought this may interest you, Bombardier lay off

http://pressrepublican.com/0100_news/x58543428/Bombardier-lays-off-105-w...

The layoffs are the result of quality-control issues with bearing housing castings that Bombardier receives from an outside supplier, which are used in the railcars the company is manufacturing for the Chicago Transit Authority. The castings are used to attach the wheels and axles to the railcar body.

Thu, 01/05/2012 - 22:29 | 2037816 trav7777
trav7777's picture

trade silver for its peak and assuming continued industrial demand.  But paper, not physical.  If SHTF in any meaningful way, silver is just too heavy to pack out.  Pt and Au.

Fri, 01/06/2012 - 02:33 | 2038264 lemonobrien
lemonobrien's picture

yeah, lots of people don't understamd this.

Fri, 01/06/2012 - 07:41 | 2038596 15horses1donkey
15horses1donkey's picture

It's electronic silver in the form of computer bits, generally stored or in transit on capacitor-charged silicon, iron coated plastic tapes or iron coated spinning steel or glass disks, in multiple secure locations directly or indirectly linked by copper wires, fibre optic cables or radio waves.

It isn't paper. And if it was, some MOFO would have smoked it, some banker would have shred it, or some hippy would have recycled it.

I mean, have you ever actually seen proof paper silver exists? Can you send me some for verification?

Thu, 01/05/2012 - 18:55 | 2037349 thatthingcanfly
thatthingcanfly's picture

Yeah, silver.

And powder, primers, casings, lead, spare dies & presses, NVG sets, freeze-dried food...

Fri, 01/06/2012 - 11:13 | 2039146 Cole Younger
Cole Younger's picture

Guns don't seem to lose value. They may not increase in value but they don't lose.

Thu, 01/05/2012 - 19:06 | 2037378 xela2200
xela2200's picture

Silver is giving me an ulcer, but You are right.

Thu, 01/05/2012 - 19:44 | 2037470 tmosley
tmosley's picture

Stop sucking on it.

;)

Thu, 01/05/2012 - 20:52 | 2037625 Buck Johnson
Buck Johnson's picture

QE3 is coming and it's coming in a month.  Things in Europe and the US aren't as they appear.

Thu, 01/05/2012 - 22:15 | 2037785 WonderDawg
WonderDawg's picture

They're not completely fucked up beyond all repair?

Fri, 01/06/2012 - 00:21 | 2038054 UP Forester
UP Forester's picture

BOHICA!

Fri, 01/06/2012 - 04:51 | 2038505 StychoKiller
StychoKiller's picture

Kinda OT:

Tiger's ex destroys $12 million mansion

Elin Nordegren levels a home that she bought shortly after her divorce from the golf star.

FROM:

http://sports.yahoo.com/blogs/golf-devil-ball-golf/tiger-woods-ex-wife-b...

 

Hell hath no fury...

Fri, 01/06/2012 - 11:15 | 2039152 Cole Younger
Cole Younger's picture

Mathmatically certain they are fucked up beyond all repair.

Thu, 01/05/2012 - 21:29 | 2037690 Banksters
Banksters's picture

I'm starting to get REALLY FUCKING SICK OF THIS SHIT.

Thu, 01/05/2012 - 21:59 | 2037753 DeadFred
DeadFred's picture

Just starting? What took you so long?

Thu, 01/05/2012 - 22:53 | 2037871 tabasco71
tabasco71's picture

Yeh, I screamed like that in 2007, 2008 and 2009, then I started putting my energy into finding a job outside of finance...

Fri, 01/06/2012 - 05:46 | 2038535 TruthInSunshine
TruthInSunshine's picture

Yes, I too have finally become enraged at Nathan Mayer Rothschild's devious shenanigans, allowing him to buy the British People (as debt serf collateral), in the wake of the Battle of Waterloo.

Fri, 01/06/2012 - 05:54 | 2038542 Ghordius
Ghordius's picture

you sound like a Napoleon symphatizer! shame on you! Dear old Natti saved, I repeat, saved us from Boney and his regime

Fri, 01/06/2012 - 06:31 | 2038557 TruthInSunshine
TruthInSunshine's picture

 

 

NM Rothschild,
Full of Grace,
The Lord is with thee.
Blessed art thou among Shylocks,
and blessed is the fruit
of thy womb, Jesus.


NM Rothschild,
Father of God,
pray for us sinners now,
and at the hour of death.
 


Amen.

Fri, 01/06/2012 - 12:18 | 2039420 VelvetHog
VelvetHog's picture

Word for word what I was going to say.  I'm out.  No more internet truth for me.  I can't handle any more.  Seriously.  Time to run the cards to the max and walk away from this money pit house.  Fuckin' Shit!!!!!!!

Thu, 01/05/2012 - 18:38 | 2037286 LawsofPhysics
LawsofPhysics's picture

A bit more on where this "data" is coming from would be helpful.

Thu, 01/05/2012 - 18:41 | 2037297 Sancho Ponzi
Sancho Ponzi's picture

'SocGen on the sequences of events:'

Thu, 01/05/2012 - 18:39 | 2037288 bahaar
bahaar's picture

Jeffery Gundlach (Doubleline) just said no QE3 between now and election.

Thu, 01/05/2012 - 18:50 | 2037324 Boston
Boston's picture

Gundlach is one of the folks I listened to when I went long US Treasuries in 1/11, just about when Bill Gross and lots of other "experts" went flat or short.  

I'm with Gundlach, unless of course risk assets melt down before the election (an event with a fairly high probability), then even Gundlach would probably change his mind and look for QE3.... to counter the melt down.

Thu, 01/05/2012 - 19:33 | 2037443 Excursionist
Excursionist's picture

I just can't fathom what the official (read: for public consumption) rationale could be for another round of QE, especially against a postive-trending macro backdrop in the U.S.  The Fed may have banks' interests in mind, but let's not forget the Obama administration isn't exactly a lap dog for Wall Street... no love lost there.  And let's also not forget that millions of wage slaves are heading to polling booths in November.  May Allah help Obama if gasoline is $4 / gallon or more.

I don't see this happening.  Agreed with Gundlach.

Thu, 01/05/2012 - 20:38 | 2037599 Silver is King
Silver is King's picture

Have you seen who contributes the most to his campaigns?  I would call him a lap elephant.

 

Fri, 01/06/2012 - 02:22 | 2038253 Excursionist
Excursionist's picture

Actually, yes I have:

Notice the discrepancy between the two.  Banks accounted for 26% of Obama's top donors' contributions, whereas banks accounted for 60% of McCain's.  This isn't about who is the bigger scoundrel, however - I agree with the notion that both sides of the aisle are captured to various extents. 

The point is that if you accept these percentages as representative of the aggregate, then you'll also accept that Obama is less beholden than McCain would have been.  Layer into the discussion the fact that Wall Street contributors have been defecting en masse from the Obama camp in the last two years, and you'll perhaps arrive to the same conclusion I did.  Hence the lap dog observation.

Fri, 01/06/2012 - 10:34 | 2039045 Rollerball
Thu, 01/05/2012 - 21:08 | 2037646 Dogfather
Dogfather's picture

"...Obama administration not a lap dog for Wall Street..."??  What??  Wake the hell up.

Thu, 01/05/2012 - 23:03 | 2037897 LiquidityandLunacy
LiquidityandLunacy's picture

I dont think they are a stand out lap dog compared to other presidents. IMHO they are all in each others laps, none more or less than the others, except at times, more is asked (re, told) so they have to look more and more like lapdogs. The willingness has always been there.

Fri, 01/06/2012 - 00:09 | 2038032 The Beam
The Beam's picture

Do we forget when their was SERIOUS TALK about Geithner stepping down and Jamie FUCKING Dimon (on of the biggest backers and supporters of Obama) becoming Treasury Secretary? Not a lap dog? NOT A LAP DOG? We remember when he argued that the Fed needed to remain independent and shouldn't be audited (when Barney Frank, Bernie Sanders, Ron Paul, and Rand Paul were calling for it from BOTH sides of Congress and the political spectrum). NOT A LAP DOG?

You're right... he isn't he a lap dog. He is a lapping donkey (get it....because he is a Democrat and that is their symbol).....Bad joke!

Fri, 01/06/2012 - 00:20 | 2038051 LiquidityandLunacy
LiquidityandLunacy's picture

Again, I didint say he wasnt, my point is that he is no different that any of them, but the situation has shed light upon all of them being lapdogs.

Fri, 01/06/2012 - 00:29 | 2038070 UP Forester
UP Forester's picture

They're all up in the Ivory Tower playing the Biscuit Game.

Guess who gets to eat the biscuit.

Thu, 01/05/2012 - 23:11 | 2037914 asophist
asophist's picture

Watching Obama perform is just like watching Charlie McCarthy insult and threaten Edgar Bergen, or Howdy Doody insulting and threatening Buffalo Bob.  The ultra corrupt Wall Street International Investment Bankers are the ventriloquist telling their Obama-dummy how to threaten them to thrill the moronic crowds of oh-so-easily-manipulated voters.  Have you never seen the blooper video of the "eloquent" Obama degenerating into a slobbering idiot when the miniature radio receiver he wears in his ear malfunctioned at a town hall meeting so he could no longer receive prompts from his staff of ghost writers backstage?  The puppet will SAY anything to please OWS voters and then DO everything that Wall Street Criminals want done to stab those voters in the back.  The bankers OWN Obama, our first 100% fake cardboard president.

Fri, 01/06/2012 - 02:41 | 2038273 Jam Akin
Jam Akin's picture

Yep.  Saw BO try to speak without a teleprompter once live in person / with my own eyes.  It was uncomfortably Fugly.  All he is really able to do is read from someone else's script and top it off with some faux Alpha banter.  What have we come to?

Thu, 01/05/2012 - 19:40 | 2037457 Lost Wages
Lost Wages's picture

Plus Gross' PTTRX fund is losing customers at an alarming rate due to underperformance, so maybe he's not the smartest cookie in the canister.

I'll keep an eye out for QE3 in case I want to take our stupid 401K out of ARTQX, BCSIX and UMBMX and put it all-in on FBIDX.

Fri, 01/06/2012 - 12:32 | 2039481 nyse
nyse's picture

I agree. Things are not bad enough to prompt a nother round of QE in my opinion.

Thu, 01/05/2012 - 18:40 | 2037295 LawsofPhysics
LawsofPhysics's picture

"And as for crude going to $250 - yes, it may cause huge headaches for regular folks but for banks it means record bonuses, and as a reminder, the Fed works for the banks, not the people, pardon neo-feudal debt slaves..."

Send crude to $250, please. 

Thu, 01/05/2012 - 19:02 | 2037335 lolmao500
lolmao500's picture

Iran + QE3, oil at $400, yes we can!

BAC at 50$ on profits of oil trading! BAC are geniuses! - Cramer 2013

Thu, 01/05/2012 - 19:41 | 2037462 Nigh Eve
Nigh Eve's picture

Oil above $200 => total erasure of middle class disposable income => massive defaults on all debt by middle class consumers.

Thu, 01/05/2012 - 20:10 | 2037522 Long-John-Silver
Long-John-Silver's picture

Automobile will sales go to near zero. Bicycles will be worth their weight in Silver. Scooters will become the family car. City’s and towns will institute walking on the sidewalk tax and fine you if you walk in the roadway even if their are no cars. Trucks will be fitted with a gasifier using wood pellets for fuel just like vehicles operating on wood gas in WWII.


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