Endspiel: Fidelity Says "It Is Clear Now That The Fed Cannot Bail Equity Markets Out Any More"

Tyler Durden's picture

Uh... did a member of the status quo just tell the truth? Cue panic?

From Dominic Rossi, Global CIO, Equities, Fidelity Worldwide Investment via The Telegraph

At times like these, it can be difficult for investors to know what to do.

We should expect news over the next few weeks to deteriorate further. As we go into the earnings season shortly, there will be more missed forecasts and guidance from companies will be uncertain and gloomy. For investors, valuations will come in to play at some stage. Yields will be well covered because balance sheets are strong.

It is clear now that the Fed cannot bail equity markets out any more and any interest rate cuts by the ECB may not have much of an impact on markets. The solution on the fiscal front will be either Greek default or Germany accepting that it has to fund debt restructuring and so reduce the quantity of debt in Greece. This will be a prototype for other European countries.

At times like these, investors should remember the strong get stronger. We will see M&A pick up in Europe. There is little capital around and so the threat for companies from new competition is disappearing.

Markets will have to consolidate so that oligopolies or duopolies are created and the remaining companies have strong cash flow and don’t have to rely on the debt markets. This is a carbon copy of what happened in emerging markets 15 years ago. Equity will shrink as well-financed companies grow by acquiring others and buy back their own equity. In time, this will stabilise equities.

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OrdellRobbie's picture

silver and gold down dramatically, paulson fund will be down big again this month

??'s picture

BlackRock ""fear will be giving over to greed before too long"


Terrence Keeley of BlackRock at the G20 on Bloomberg TV an hour ago  discusses how BlackRock is in the middle of every important conversation and how Lagarde will be brought to heel:

"fear will be giving over to greed before too long ... I had a meeting with a central bank governor yesterday who said (Lagarde) thought the Euro would not exist in one year, I promise you  by the end of this weekend she will not hold that position ...  Christine is new on the job obviously finding her way"


Zero Govt's picture

that's the same Blackrock that likes China because its Totalitarian State control 'helps' smooth the path for capitalism (at least Blackrocks shoddy authoritrian non-free market version of capitalism - fascism anyone?)

meanwhile yesterday 1,000's of the Chinese public attacked Govt buildings (great target selection by the public... for once!). The local and State Govts (public emplyees) in cahoots with Blackrock-stylee private companies are trying to steal peoples private land for their own purposes (charming!)

The Shanwei government accused villagers of having “ulterior motives” and of “inciting” villagers to attack the Communist (fascist? ..they're all the same parasites whatever label used) Party HQ and police station by 'spreading rumours about police officers beating a child to death'.

It's not like Govt ever spreads rumours (WMD, 9/11 terrorism caused by Saudis used to invade iraq etc) to incite violence is it?

Maybe Blackrock have lost the fascists plot on the Euro ..and China

kalasend's picture

Same goes for a lot of ZHer.

I just don't think everybody is as much on physical as their comments make it look like

Temporalist's picture

Why because gold is still up for the year and if anyone, ZHer or not, bought physical gold in the last 52 weeks or more they have gained value?

Why do you visit ZH and learn nothing?

spiral_eyes's picture


I'm 95% physical, 5% mining stocks. The key is to buy regularly, buy the dips, and to have been in the game since at least 2006.

virtually everything in my portfolio still has a lot of squeeze room before i'm in the red on ANY trade. gold could drop to $700/oz and I'd still be in the black, because although I've been buying at $1200, and even some at $1700, the majority was accumulated much lower.

jekyll island's picture

OK, you're a genius.  Quit bragging.  Or at least give me your projection for Tower Hill Mining.  

spiral_eyes's picture

To be honest I'd say I was quite mediocre among ZH readers in both absolute P/L and % terms, but I don't know for sure. I mean everyone has outperformed John Paulson this year...

And Tower Hill... It's 6 times the price it was in Jan 09. Personally I would wait 'til the next QE spike and sell... that's what I'm doing with my gold mining stocks. When the big crash hits (possibly one more QE cycle away — although not necessarily) gold stocks are going into the ground short-to-medium term...

kalasend's picture

Yeah right, swear the same allocation for other ZHer's. Who's talking about u?

MonkeySmoke's picture

GSR is currently 51:1 which means trade gold for silver and when the GSR reverts, and it will, swap silver for gold and stack the difference. Meantime--exchange fiat for silver at a much better exchange rate!! kalasend what do you know about how much physical anyone has? You know nothing.

Dingleberry's picture

As for PMs, physical delivery has risks.  You have the risk of theft, costs of storage, etc.....and high taxes upon redemption.  Pms are insurance. Period. Even if they exploded, most folks get paid in dollars, have 401k that aren't even allowed to invest in gold, and on and on and on.  PM-ers are buying gold/silver only to keep a semblance of purchasing power.  As I heard a wise man once say, "you may get rich if gold goes to 5k, but you won't want to look out your front window".

101 years and counting's picture

any ECB rate cuts will KILL the EUR and send equities into a massive freefall.

Quinvarius's picture

Gold is going to benefit greatly from the secret loans the Fed is making right now.  Just like 2008, but this time they don't even need to ask permission.

El Gordo's picture

Is anybody squealing yet?  They're pinching pretty hard.

Quadlet's picture

Think your money is safe in your bank?

Momauguin Joe's picture

Safer in well secured stores of vodka, whiskey, toilet paper, trash bags, footwear, clothing, ammo, etc....

Esso's picture

Yes, and food.

A five gallon bucket holds ~35 pounds of rice or beans.

Momauguin Joe's picture

True that. Many more things to stock up on that will retain their value. Just off the top of my head: Cartons of cigarettes (I've personally seen cigs selling NOW for $1 A PIECE at local inner city bodega's), hammers, nails, door hinges,  rainwater, non-hybrid garden seeds, canning jars, reading glasses, over the counter medicines, vitamins, portable solar panels....

Storch's picture

Propane, antibiotics, sewing needles, wool socks...

Saxxon's picture

Excellent thoughts but cigarettes quickly get stale - grow your own terbacky.

Stoploss's picture

Holy Fucking Shit...

the not so mighty maximiza's picture

I hope Fideltiy will stop sending me emails to contrubute more to my 401k then.



Miss Expectations's picture

Years of casual contagion talk.  Shall we soon see how contagious panic is?

spiral_eyes's picture

LOL i disagree.

Benny will try IOER, try another huge tidal wave of QE, try Op Twist 2, and ultimately probably try printing money and directly monetising gov't debt (an idea so hyperinflationary even Krugman scorns it)

Will any of these save the global financial system?

Nope. It's dead in the water.

Will the endgame be fun to watch (and profitable if you're long gold)?

You betcha.


sudzee's picture

Printed 1's and 0's no longer accepted as money.

Zgangsta's picture

So...stock up on nickels, quarters, and five dollar bills?

Terra-Firma's picture

Zerohedge......is the only change you should believe in


everything else is just obummer.

youngman's picture

Interesting..he didn´t really say what to do with your money did he???

the not so mighty maximiza's picture

its implied   babes, bullion, bullets, beans, beer, and bunkers

boom goes the dynamite's picture

Is  today Black Friday or is that next week?

orangedrinkandchips's picture

His ass will be fired for TELLING THE TRUTH....


poor bastard.

cossack55's picture

No shit. His chances of guesting on Quack on the Street just went to the same level as Mike Pento.

DaBernank's picture

Poor KITCO live silver page is broken doesn't even send a chart anymore, their servers must be broken with people hitting "refresh" on their browsers every second. Not really worried, not "all in" had some speculative positions in ETFs that are getting wiped, c'est la vie, I did well now I give some back. If it's *risk capital* it's not a huge problem now is it? People betting with their retirement money, kids' college funds, food money, are fucked.

junkyardjack's picture

The real drop is about to come.  Moves like this have got to crush a lot of hedge funds.  Everyone bet on Gold and its done for now, LT holders may be in the clear by later this year but can the levered funds using OPM withstand the pain?  AAPL is the last standing safe haven for now

Scisco's picture

Psssttt. I got a secret. Apple sells luxury goods. All but a few are getting wiped out right now. When it comes down to a choice between the iPhone 5 and or keeping yourself warm, who do you think is going to win.

Going Loco's picture

But you can burn an iphone to keep warm. While you tuck in to your oh-so-nourishing ipad.

Spastica Rex's picture

iPhone 5 and then riot against the evil government for not keeping us warm.

Storch's picture

Two thirds of those in the poverty index pay for cable telivision. Obviously the iphone will win.

Bindar Dundat's picture

The world is not ending you idiots!   It is just changing.

Temporalist's picture

I think the great monster Bernankenstein killed the Mayans and is back for the second coming to destroy what is left.

Wynn's picture

The Mayans weren't destroyed. They just said fuck it.

Mitzibitzi's picture

I agree. But my opinion would likely be different if I lived in an inner city.

jekyll island's picture

You're right.  Remember how the gasbags on CNBC were calling the dotcoms the "new economy" before the bubble burst?  They were wrong.  You, Bindar, correctly if not succinctly state we are transitioning to the real "new economy" that will unfortunately be ushered in by fiat currency collapse.  

Caviar Emptor's picture

Throughout history the world did not end. But many people's world ended  many times

Robslob's picture

Welcome new guy (bindar dumdat)

1) Most here recognize new shills when they arrive

2) Just because people on this board acquire and store "non-debt based" capital does not mean we think the world will end

3) To your point...because the "world is changing" we change with it by preserving wealth via PMs

4) I do not believe you to be an idiot just because you post like one


That is all...you may go now...