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ETA To NEW QE: Don't Hold Your Breath Just Yet
Whether one believes that Bernanke's mandate mission in life is to 'save the banking system', 'reflate asset prices', 'devalue the USD' - all of which seem to err on the side of inflation (and ultimately hyper-inflation once the trust is gone); it seems more critical to focus on the other side of the coin - deflation. Bernanke's true raison d'etre is simple: avoid debt deflation and implicitly everything he has said and studied points to the avoidance of any deflation. For this reason, BofA notes that today's chart of the day is the Break-even inflation rate in the US. This has been the most consistent - non-numeraire-based - leading indicator of Fed QE efforts. We note that the initial QE2 decision took a little longer to enact but was signaled considerably earlier (Jackson Hole) as the break-evens dropped below its NEW QE threshold. But with the levels currently 25-30bps off their threshold levels, we suggest those holding their breaths for the next Fed-induced liquigasm in stocks, should practice Pranayama.
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It is inevitable...
The mathematics defines it.
Luckily my gold won't spoil or rot or default whilst I'm waiting...
Gravity is a bitch.
I like to visualize the printing situation like a giant leaking fish bowl with the masses of fiat using guppies cluelessly swimming about unaware of the falling water line. World central bankers are trying to pour just enough water in to keep the fishies alive. Gold is behaving like a bobber floating on the water's surface and providing a measure of how fast or slow the central bankers are pouring water in (printing). If they get lucky and get it just right, gold and silver will be flat to slightly down.(I don't think they will) Too little and down we go in a deflationary collapse. If they misjudge and add too much, the water and guppies will spill over the edge and out onto the floor and die. Gold is your life preserver in case the CB's fuck it all up. They are guilty of mass murder if they fail and the system collapses for having denied how important gold is to your survival.
According to that chart, we ought to be expecting QE3 sometime around October. That's over 5 months out. Gravity still apparently takes a bit more time.
I can wait...
WTF, we drop 100 S&P points, and it's print or die already??
1215 still too high...
800 is too high
300 is too fucking high. Paper is going to zero. If you can't touch it, you don't own it.
I'm placing a firm floor on the ES at $0.01. At that price, I will buy it all.
I'd rather own private equity then public debt.Governments always default,once people start fleaing public debt is when the Dow goes to 36k.
All paper going to zero, including private equitiy "stocks". How do you think the revenues for these companies will look when the dollar is worthless? You would do better to buy land for lease to future sharecroppers (something a number of corporations and banks are already doing).
-100 S&P points! OMG we need fresh free monees up in here!!
These people are deludng themselves with their chomping at the bit for QE every hour, and its not going to come...at least not until WAY lower, if at all.
any statement that ends with "up in here" is taken more seriously than those without it. i use it in company meetings all the time now and i get IMMEDIATE results
+1 I LOL'D
not until after elections, for the 1000th time i say.....and again, dont hold your breath for 2000 gold until qe3 is implemented..................funny how many people on here cant accept that.............
It's like Homer Simpson and his microwave hotdog... "30 seconds!? But I want it now!?"
It truly makes no sense to have folks continually betting on gold.
Gold is insignificant to society and life, and the point of that is that it CAN'T become significant. If it did, threatening "the system", then governments globally in globaly coordination will simply tax transactions.
You can own it, but if you traffic in it, you'll be taxed on the transaction, perhaps 60%.
It's pointless. Governments have the power to do this. You could never do private transactions because you would never know if your counterparty is law enforcement.
Well, try to levy a 60% tax on gold transaction in countries where gold ownership is widespread and a primary mean of saving! (India and China for example). The people wouldn't be concerned about their gold, but the law enforcement would be mightily concerned about their own rear end. What happens if you do that in the US? Gold will simply flow out of the country to wherever it's not taxed.
Your right they could do that but they wouldn't unless they want a revolt. Gold has an emotional connection to the world, anything done along those lines would create some serious pushback. They added a tax to Indian Gold a couple months ago and the market basically shut down completely! They eventually relented and removed the tax of course.
I don't think the gubmint will be successfull fucking with PMs like Roosevelt did, that was a one-time opportunity because the people will not be folled again! Also, some states have already made moves to allow Gold and Silver as a form of tradable currency - this sort of restricts what the Feds can do.
Leave my Gold alone, just keep printing paper money Bernanke.
Yes you can, you can do it through a trust. There is absolutely nothing stopping me clearing your trades on your behalf anywhere including overseas.
No country can stop that.
To be blunt, your entire scenario is just not workable. There is no way any government can prevent it. If they stop you investing in gold, where are you going to invest? Corn? Wheat?
Inflation would shoot skyward like you wouldn't believe.
That might end up being a whole pile of straws on the camel's back.
You also can't buy marijuana ... because it's illegal... but people seem to... have found a way around that...
The market is still high, but they either have to print soon or wait til after the elections.
Yea and look at them rush in to emergency re-pump markets every time, the muppets are going to be waiting a real long time before theyre showered with mythical free money for their losing stock portfolios, if ever.
Inevitable yes, delayed...probably.
Yes, but no rush. We all know the end game. Just going to take time to get there. And when the funding crisis hits, that is when it will get interesting. Until then, same old shit.
and fire sale prices... BEFORE the fire.
I have been saying since Jan, we aint getting QE til SP is near 1000
Deep79 wrote:
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I have been saying since Jan, we aint getting QE til SP is near 1000
============================
I respectfully disagree. I think that the SP 500 index need only decline to 1250. If it falls below that point, then QE3 is practically guaranteed, except that QE3 probably will not be called "quantitative easing 3," but something else.
-- Paul D. Bain
paulbain@PObox.com
His mission is to give the banksters everyone's money and set the stage for a culling of the population. He is a ChairSatan.
Besides don't need the Bernank on this one we have the retail inverstor doubling down bargain hunting with a Martingale vengence after the collapse of FB
more whining banks asking for QE....QE is now a politcal timebomb, bernanke gets reappointed no matter who is in office, which is why the repubs have said nothing about him or the fed if you havent noticed
Romney has stated, if he's elected Bernanke's out.
and do you think that will make any difference?
None whatsoever. Other than everyone having someone else to bitch about.
unless he anoints Ron Paul............armed with a flamethrower..............
the odds against that are bigger than the national debt...
He probably wants out at this point. Being the visible hatchet man for the CB takes its toll. Time for someone else to turn their face into a dartboard.
Yep, and besides, Goldman needs a new CEO
perhaps you should look at romneys top contributors...............
Goldman Sachs $573,080 Bank of America $398,850 JPMorgan Chase & Co $393,825 Morgan Stanley $373,850 Credit Suisse Group $317,410 Citigroup Inc $301,550Damn where did all those insolvent banking fronts get all those monees to throw around to politicians? Hmmmm.
Please don't confuse my comment as any vote of confidence (in either candidate)... Just saying what was said.
How low can gold, silver and oil go? Place your bets people!
The top will be:
1-ounce of gold = 4000 shares of facebook (If facebook was still on the stock exchange at the price they probably would have set it at.)
Up, down, up, down, up, down. Something about Debbie and Dallas.
Fucker needs some fresh rope with a pretty sliding loop at the end action...
Bernanke is going to be remembered as the man who brought HyperInflation to the world.
Is there a "Man of the Year" award for that?
Cover of Time Magazine and a Nobel Prize, of course.
My bet is the bottom is in for both gold and silver. Can retrace some, scare out the weak holders, but I think we continue to move higher with the usual fits and starts. And that is how I am playing it.
Just a quick detour - anyone know where that wiki photo was taken? That is one hell of a beautiful location (if you ignore the half naked man).
Cannot wait for the lawsuits on FB to start. Oh, that is going to be a fun time. What a crock of shit that stock is. I never logged on to face book.0 interst and I like my privacy.
My daughter does though, a lot. I asked her how much has she bought from the ads on FB. She advised, "Dad, you kidding, none of us buy anything, we just "chat and share pictures".
Precisely, zero revenues, but hey, homeland security will know exactly where she is and who she associates with. Why does this not make us all feel warm and fuzzy?
No worries! We've got the Biderman stating FB probly worth about $1 trillion! Introducing Biderman's Market Picks: Facebook Could be $1 Trillion Stock - YouTube
Who needs Tantric stuff, all you gotta do is fantasize about a Janet f*ck sandwich: Napolitano and Reno. That'll cool you down pdq...
But back to our story: unplanned events not on the calendar of Mr. BS & Co could easily pull the rug out from under the preferred QE timeline
"...fantasize about a Janet f*ck sandwich: Napolitano and Reno"
Not cool man. Not cool. You made me think it, and now I can't unthink it. Time for me to push the Q-tip all the way in.
ZH is obviously the best source out there bar none.. but they should really make their mind up.. only yesterday they were suggesting its coming soon and today suggesting otherwise..
Although its essential to get contradictory info to form you own opinion ZH doesnt seem to have an opinion anymore.. and just claims whatever the most recent article supports as its opinion.
QE is coming we know.. but is it June, August, bla bla bla?? we dont really know. we can assume based on evidence.
ZH changes its mind quicker than the fucking retard market.
Tyler you the man though really appreciate your hard working crew
@Von Manstein
It's Tylers, as in plural and I prefer heterodoxy over consensus. ZH is incorrectly described by some as "bear porn," when in fact, it's a unique source for economic and market perspectives.
note i reffered to tyler and his "crew!" .. i am aware that there is more than man (or woman) running this operation.
And look i said it was good to have contradictory info so we can formulate our own opinions.. so im not really sure what your getting at.
my point is the the tylers are all to quick to claim they predicted something or as things happened as they said they would... but never acknowledge they have said lots of contradictory things will happen.. and never have i heard them suggest they got something wrong.
but hey as i said. ZH is where i get my news and base my investments partly on the things i read.
and whats wrong with bear porn? as rick rule said.. "volatility is our friend"
its pretty bearish round here to be honest but thats just reflecting the world being ina crisis. its bearish for a reason. and i agree..
long phyz
Dear FED: There is NOTHING wrong with deflation. You fear it too much.
We are where every rational (i.e. non-Keynesian, non-Monatarist) thought we would be: painted into clusterfuck corner. The never was an easy way out and any dumbass who advocated dropping money out of helicopters should be in an asylum by now. We can't ignore the mountains of debt. It is still there, waiting to be paid or defaulted. Either way, it ultimately leads to deflation. It's inescapable.
D.C. is where the Bernanke stays. D.C. is an insane asylum. They merely let the inmates come and go as they wish. But hopefully quite soon it will get locked down and the crazies will never be allowed to mingle with the public again.
No QE until the numbers we make up says so...
By allowing the markets to fall further:
1. Destroys money by causing it to disapear into thin air.
2. Money liquidated will hurt private investors as banks will just get another handout later from uncle Ben. But no QE has put money in mom and pops pocket.
3. Destruction of billions in market allows fed to print more, give to banks, and avoid inflation in the cpi. (theory)
4. Psychologically, it makes uncle Ben look like a hero for riding in and saving what is left of mom and pop's 401k.
Because of these points, no QE for a while yet. Hell, Europe is up for two days now, the world must be okay, right? The place to be today is in Italian equities. No worries that they are at a 10 year low or that they are the 8th largest economy in the world, or that there is a run on the banks developing. Buy some Europe/Italian stocks. They're GGGGRRRREEEAAATTT!
Until the Fed significantly adds to the monetary base, rather than sterilizing their liquidity additions, I do not think we will experience hyperinflation. Meanwhile, since we are experiencing a global solvency crisis, and not a liquidity crisis, even the low long term interest rates managed by the Fed will not be helpful in stimulating economic activity because the ability to pay even a low rate of interest is severely compromised due to the large overhanging debt. Of course, if the Fed chooses to literally "print" by expanding the monetary base, US Treasury bond holders will liquidate, probably making the Fed the buyer of last resort, while the dollar will be severely compromised. in other words, the Fed now has the choice of overseeing monetary destruction by deflation by doing nothing and letting debt defaults take care of the process, or by hyperinflation, by literally printing currency. Perhaps Mr. Bernanke plans on adding a codicil to his thesis after he decides which course to take while overseeing the results. Results which in either case will be highly unpleasant.
The system is going to deflate, and IN THE LONG TERM there isn't a goddamned thing the Fed can do about it.
That is what people don't get about QE. There is plenty of money out there in the banking system right now. The problem is there are no more assets to secure more debt (money printing) and the world economy can't service the current debt level. So more printing which is just more debt is not the answer and is not needed.
Deflation is coming for now. Just not in the area of day to day necessities.
That's what I've been thinking. But then when the market goes up I have my doubts. Peter Schiff was on Coast to Coast last night and after listening I felt better.
I say this all happens after the elections; the Federal Reserve would like for this NOT to be a main debate issue.
I mean, summer chaos and more bank downgrades are possible.....but the Fed really wants QE to be as quiet as possible....they are already concerned about their image, look at the transparncy fail job of a PR campaign they just had.
Either way, QE will happen....the corporations...and the banks that bankroll their operations, and who handle their stock portfolios, will demand it from the Bernank.
"May 22, 2012 Is America Bankrupt? If the U.S. government were a private company being audited by standard practices, it would be considered much further in the red than official national debt figures show. It would, in fact, be shut down and its key executive prosecuted for fraud. - in The Fiscal Times"
Long term inflation or deflation or QE or not will become just another construct to explain the colapse all of us will be forced to live with.
Preparing for the collapse is the important thing to remember, not our gold balls or money wad.
Didn't plant a garden senior, with heirloom seeds?
Please try to think it through.
Watch the Robin babies in the nest.
You are high on on zeros and hedges.
Better get to the next screen.
bill
No new QE, that's great news. That means the Fed doesn't need to manipulate the economy further. Best news in a long time.
Also, is this why gold is crashing again? Stocks are doing much better, especially in Europe where the situation is great again.
At some point Genocide Ben has to realize the warning shots of the currency wars have already started. We're not the reserve currency anymore, though the dollar is temporarily still involved in much of the world's trade. The usefulness of the dollar around the world has ended in the last three or so months...mostly the last three months.
QE3 costs us the reserve currency in total, the inflation from that, as well as China is about to cause those Wal*Mart import prices to skyrocket.
Ben's going to do that for that little? Well I guess that's why he's called Genocide Ben or Benocide.
Glass-Steagall (especially the worthless derivatives before they make us and the world WORTHLESS...either the world is worthless or the derivatives are made worthless.)
In MLA formatting, commas go inside quotations, but never mind that: Other problems abound.
Most notable is the improper semi-colon. Don't use one of those unless you already have an independent clause, and then only use one if you're sure it belongs there.
If you have a dash, you probably want a double dash, and you probably want it on both sides. You should either have
USD," all of which
or
USD"--all of which
and
gone), it seems
or
gone)--it seems
and take the dash at the end and change it to a colon or comma
coin: deflation
or
coin, deflation.
Also,
stocks should (no comma)
simple: Avoid (need cap b/c what follows the colon is an ind cl)
consistent, non-
or
consistently non-
and-- deflation, and implicitly (ind, and ind)
Some editing would really help the site's credibility. Just sayin'.
Clashfan,
I agree with your opinion, but you are probably going to be "moderated down" nevertheless. The participants on this web site, ZH, do not like either "grammar or punctuation Nazis." Just saying.
-- Paul D. Bain
paulbain@PObox.com
That's cool, Paul. I don't want to be disruptive on the threads, just to be heard by the writers. Trying to be supportive. :)