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Foreigners Dump $74 Billion In Treasurys In 6 Consecutive Weeks: Biggest Sequential Outflow In History

Tyler Durden's picture




 

Over the weekend, we observed the perplexing sell off of $56 billion in US Treasurys courtesy of weekly disclosure in the Fed's custodial account (source: H.4.1) and speculated if this may be due to an asset rotation, under duress or otherwise, out of bonds and into stocks, to prevent the collapse of the global ponzi (because when the BRICs tell the IMF to boost its bailout capacity you know it is global). We also proposed a far simpler theory: "the dreaded D-day in which foreign official and private investors finally start offloading their $2.7 trillion in Treasurys with impunity (although not with the element of surprise - China has made it abundantly clear it will sell its Treasury holdings, the only question is when), has finally arrived." In hindsight the Occam's Razor should have been applied. Little did we know 5 short days ago just how violent the reaction by China would be (both post and pre-facto) to the Senate decision to propose a law for all out trade warfare with China. Now we know - in the week ended October 12, a further $17.7 billion was "removed" from the Fed's custodial Treasury account, meaning that someone, somewhere is very displeased with US paper, and, far more importantly, what it represents, and wants to make their displeasure heard loud and clear. Whether it is China - we do not know: we may have a better view in two months when the September/October TIC data hits, but even then it will be full of errors, as Direct Bidder purchases by the UK usually end up being assigned to China at the yearly TIC audit. And the sellers know this all too well. What they also know is that over the next few days (or weeks - ZH tends to be a little "aggressive" in its estimates for popular uptake), as soon as the broader population understands what has transpired, concerns about the reserve status of the greenback will start to resurface, precisely as many have been warning. And what has happened is that in six consecutive weeks, foreigners have sold $74 billion, or more government bonds in a sequential period of time than ever before.

So... perhaps it is time to reevaluate US intentions for a trade war with any of its "evil" mercantilist, UST-recycling partners. Unless, of course, they want $74 billion to become $740 billion, and to force the Fed to have no choice but to intervene, only this time not with a duration sterilized procedure, but one where the Fed has to buy everything that China et al are selling.

On the other hand, judging by the traditional reaction of various precious metals to this kind of fiat suicide, perhaps it is not such a bad idea after all...

Total holdings in the Fed's Treasury custodial account and weekly change:

Trailing 6 Week Cumulative Total of custodial account Treasury flows.

 

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Thu, 10/13/2011 - 18:10 | 1771421 Eireann go Brach
Eireann go Brach's picture

Timmayyyy get on the phone with Hewlett Packard and order a new round of printers!

Thu, 10/13/2011 - 18:18 | 1771456 I think I need ...
I think I need to buy a gun's picture

from greenspan himself circa 1966

Under a gold standard, the amount of credit that an economy can support is determined by the economy's tangible assets, since every credit instrument is ultimately a claim on some tangible asset. But government bonds are not backed by tangible wealth, only by the government's promise to pay out of future tax revenues, and cannot easily be absorbed by the financial markets. A large volume of new government bonds can be sold to the public only at progressively higher interest rates. Thus, government deficit spending under a gold standard is severely limited. The abandonment of the gold standard made it possible for the welfare statists to use the banking system as a means to an unlimited expansion of credit. They have created paper reserves in the form of government bonds which — through a complex series of steps — the banks accept in place of tangible assets and treat as if they were an actual deposit, i.e., as the equivalent of what was formerly a deposit of gold. The holder of a government bond or of a bank deposit created by paper reserves believes that he has a valid claim on a real asset. But the fact is that there are now more claims outstanding than real assets. The law of supply and demand is not to be conned. As the supply of money (of claims) increases relative to the supply of tangible assets in the economy, prices must eventually rise. Thus the earnings saved by the productive members of the society lose value in terms of goods. When the economy's books are finally balanced, one finds that this loss in value represents the goods purchased by the government for welfare or other purposes with the money proceeds of the government bonds financed by bank credit expansion.

In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value. If there were, the government would have to make its holding illegal, as was done in the case of gold. If everyone decided, for example, to convert all his bank deposits to silver or copper or any other good, and thereafter declined to accept checks as payment for goods, bank deposits would lose their purchasing power and government-created bank credit would be worthless as a claim on goods. The financial policy of the welfare state requires that there be no way for the owners of wealth to protect themselves.

This is the shabby secret of the welfare statists' tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists' antagonism toward the gold standard.

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Thu, 10/13/2011 - 18:24 | 1771478 dlmaniac
dlmaniac's picture

Who needs foreigners when you have BEN-52 carpet-bombing the treasury market?

Thu, 10/13/2011 - 18:30 | 1771490 Kitler
Kitler's picture

Shit ----> Fan.

Buckle-up.

Thu, 10/13/2011 - 18:33 | 1771513 redpill
redpill's picture

Biggest bubble ever.  Is it finally ready to pop?

Thu, 10/13/2011 - 18:48 | 1771576 spiral_eyes
spiral_eyes's picture

hate to say i told you so bitchez

http://azizonomics.com/2011/08/31/chinas-endgame/ 

Thu, 10/13/2011 - 21:55 | 1772030 Ahmeexnal
Ahmeexnal's picture

so it has begun...the snow flake that will turn into an avalanche has already landed on the snowy slope.

yet, the sheeple party like it's 1999:

http://www.uefa.com/uefaeuro2012/index.html

Fri, 10/14/2011 - 01:21 | 1772527 rcintc
rcintc's picture

I think Homer says it best...

http://www.talkingwav.com/homer/homer_04.wav

Thu, 10/13/2011 - 19:33 | 1771704 jomama
Thu, 10/13/2011 - 23:18 | 1772210 Phil Free
Phil Free's picture

lurid bubbley, budy

Thu, 10/13/2011 - 19:45 | 1771759 Triggernometry
Triggernometry's picture

Grab a poncho first

Thu, 10/13/2011 - 23:13 | 1772195 TheFourthStooge-ing
TheFourthStooge-ing's picture

Grab a poncho first

A Mexican poncho or a Sears poncho?

 

Fri, 10/14/2011 - 06:39 | 1772725 BandGap
BandGap's picture

Sears poncho, no foolin'.

Thu, 10/13/2011 - 21:58 | 1772034 upWising
upWising's picture

Kitler:  decorum, please.

FÆCES  -----> WHIRLING BLADES.

OSHA-approved crash helmet

Rosary (optional).

Fri, 10/14/2011 - 06:52 | 1772739 mick_richfield
mick_richfield's picture

Fewmets -----> Windmill

Thu, 10/13/2011 - 20:52 | 1771922 mailll
mailll's picture

I keep mentioning it over and over again on zero hedge that if foreigners aren't buying our treasuries, then who is?  It's the printed money by the Federal reserve.The problem is that if they can keep our interest rates on our US Treasuries at rock bottom by buying them, and that they have this much control over our Treasuries, then they can very easily crash our bond market as well whenever they decide to.  They are not on our side, but on the side of evil.  Please beware of the person in the drivers seat.  He can crash the vehicle anytime he wishes. I can't emphasize this enough. 

Thu, 10/13/2011 - 21:09 | 1771936 Republicae
Republicae's picture

Quantitative Easing my friend, the FED is buying Treasuries, which are essentially worthless paper securitizing the other worthless paper we call Federal Reserve Notes. Fiat paper money substitutes backed by fiat paper Treasuries, which are in turn backed by the fiat paper money substitutes, which are backed, by get this, the Full Faith and Credit of the United States of America. Hmmmmm...nothing like honest money is there?

It's almost as good of a scam as the Social Security Trust Fund, which doesn't have a single dollar in it, only very special government securities. What makes them so very special? They are unmarketable securities...can't be sold. More fiat paper, worthless substitutes for assets. 

In a very real sense, the monetization of debt was a stoke of genius, it allowed the governments of the world to operate well beyond what they would have been able to do on Sound Money. All fiat currency, being double liabilities are a wonder to behold, especially when the system is dying. Too bad so few understand that gold, and silver, are double assets...it makes all the difference in the world when it comes to monetary potency and economic health.

 

Do you smell it? The fish is rotting from the head!

 

 

Thu, 10/13/2011 - 23:02 | 1772173 Snidley Whipsnae
Snidley Whipsnae's picture

Republicae...

"In a very real sense, the monetization of debt was a stoke of genius, it allowed the governments of the world to operate well beyond what they would have been able to do on Sound Money."

No expanding empire can function on a sound money foundation. Up front money is needed to start a war and a great deal more money is needed to fund long multi front wars.

Greenspan's comments about welfare statists aims and fiat vs gold were good as far as they went. What Greenspan did not address was the need for fiat currency/gov bonds to finance wars. History shows that countries with sound money switch to fiat quickly in wartime.

Empires and fiat currencies go hand in hand.

Thu, 10/13/2011 - 23:24 | 1772230 Oh regional Indian
Oh regional Indian's picture

Excellent point SW.

Fiat is the enabler of empire. Or rather, debt is, but Fiat makes it all go around.

ORI

Fri, 10/14/2011 - 02:47 | 1772597 Popo
Popo's picture

And a corollary argument is:  All empires require fiat.   The expansion of fiat is always a self-limiting and ultimately-doomed exercise  -- ergo all empires are self-limiting and ultimately doomed. 

 

 

 

Fri, 10/14/2011 - 06:56 | 1772742 mick_richfield
mick_richfield's picture

Another corollary is that fiat is the death of the Republic.

The Powers do not need to even simulate democracy if they can create their own 'money', and force us to accept it.

Thu, 10/13/2011 - 23:37 | 1772265 Republicae
Republicae's picture

My point exactly. Without fiat, the government is limited and thankfully so. The fact that during war many countries have, in the past, resorted to the suspension of specie, is indeed evidence that while sound money does restrain, the necessity for even more restraint is needed. The lack of public understanding, or perhaps the gullibility of the public is also a factor that allows government to go beyond the law, suspending specie in order to fund its wars, wars that are usually purely interventionist in nature and rarely defensive.

Fri, 10/14/2011 - 06:30 | 1772713 nmewn
nmewn's picture

I am heartened others understand the basic thing.

Without unbacked fiat, there would be no money for wars or welfare. We need to decide.

Thu, 10/13/2011 - 18:24 | 1771479 Don Birnam
Don Birnam's picture

"Foreigners:" Does that also include that El-Arian chap at PIMPCO ?

Thu, 10/13/2011 - 18:40 | 1771544 Fish Gone Bad
Fish Gone Bad's picture

He is only 42% foreign to me, but his name sounds 100% foreign to most people.

Thu, 10/13/2011 - 19:52 | 1771781 Biosci
Biosci's picture

42%?  Three-sevenths?  Apparently one of his great-grandparents was a hermaphrodite?  Christ, what amazing info you can get on ZH.  I f'ing love this site!

Thu, 10/13/2011 - 20:11 | 1771829 whisperin
whisperin's picture

T thought that was an airline!!!

Thu, 10/13/2011 - 18:34 | 1771516 nyse
nyse's picture

Good. Thank you.

Thu, 10/13/2011 - 19:46 | 1771768 acabrer
acabrer's picture

HEY! (leaning in trying to hear over party noise) FANCY MEETING YOU HEAR! COOL PARTY UHH! ILL BUY YOU A SHOT!

Thu, 10/13/2011 - 18:59 | 1771602 Au_Ag_CuPbCu
Au_Ag_CuPbCu's picture

Too bad Greenspan sold his soul.

Thu, 10/13/2011 - 21:01 | 1771943 Republicae
Republicae's picture

Greenspan, was bought and paid for...he'll rot in Greenbacker Hell.

Thu, 10/13/2011 - 23:15 | 1772201 TheFourthStooge-ing
TheFourthStooge-ing's picture

Too bad Greenspan sold his soul.

Whatever he got for it was more than it was worth.

 

Fri, 10/14/2011 - 02:51 | 1772605 Popo
Popo's picture

Ayn Rand got to him.  He started to believe in the always convenient lie that market participants are self-governing and always operate in the interests of self-preservation.

...that is until Greenspan gave his famously pathetic "I found a flaw" speech to Waxman.   At which point, Greenspan's career should by all rights have ended -- and he should forever have been remembered as a fraud of historic proportions.

But along with accounting standards, capitalism, constitutional democracy and other extinct concepts -- we have also retired the concept of failure.

 

Fri, 10/14/2011 - 00:11 | 1772351 Calmyourself
Calmyourself's picture

Who the heck reads that quote, looks at Greenspans actions and red flags this comment??  Clearly the Stasi has penetrated this freedom cell..

Fri, 10/14/2011 - 03:03 | 1772611 Gief Gold Plox
Gief Gold Plox's picture

Now and then I do. By mistake. Sitting on the porcelain throne, reading ZH... with the f-ing touchscreen phone you need to be very accurate to vote up, missing the down arrow. I'm not saying I downed this exact comment, but it happens every so often.

Fri, 10/14/2011 - 01:24 | 1772529 Waffen
Waffen's picture

Just a theory.. But what if, just what if, this has all been Greehspan's plan to implode the system so we can return to a gold standard and kill the banks?

Fri, 10/14/2011 - 05:22 | 1772679 Manipulism
Manipulism's picture

Bix Weirs theory.

Thu, 10/13/2011 - 19:38 | 1771731 decon
decon's picture

This could also be attributed in large part to EU banks.  Just yesterday they announced they would not seek capital in the markets but through liquidation.  Since they announced their strategy yesterday it means they had already largely made the moves.

Thu, 10/13/2011 - 22:41 | 1772109 TrulyBelieving
TrulyBelieving's picture

Written in 1966 Allen Greenspan....Just wondering exactly who, by name or organization, are these "welfare statists"? If I got any understanding at all, that be the enemy.

Fri, 10/14/2011 - 00:15 | 1772367 Prometheus418
Prometheus418's picture

Circa 1966, Greenspan was a follower of Ayn Rand.  Rather than writing a lot here, I'll just direct you to her body of work for the answer to that question- she used that exact term extensively.

 

Fri, 10/14/2011 - 00:34 | 1772412 AustriAnnie
AustriAnnie's picture

Unfortunately, because Greenspan spoke out in defense of free markets, then actually in action supported corporatism and the Federal Reserve ponzi, many people are now confused between the two.  Thank you Greenspan, for not only selling out your soul, but also doing it as a corporatist under the guise of a free marketer.

Fri, 10/14/2011 - 12:48 | 1774234 tamboo
tamboo's picture

ATLAS SHRIEKED: Ayn Rand’s First Love and Mentor Was A Sadistic Serial Killer Who Dismembered Little Girls

well her birth name was rosenburg or some such, jews love goy killin joo serial killers.

Sun, 10/16/2011 - 09:25 | 1778614 PAUL LEO FASO
PAUL LEO FASO's picture

Notice how we are now poised to carpet bomb Iran because it is selling its oil without accepting the Federal Reserve Note?   Notice the internal combustion engine has been under your hood for over 100 years when every other piece of technology has changed on planet Earth?  Notice the private Federal Reserve Bank has been sub-contracted by the Congress for 100 years to run our money?  Notice the "RESERVE CURRENCY "to die for is the Petro/Dollar worthless fiat authorized the Congress who have abrogated their right and duty to "coin and regulate" money?  Notice how oil is measured in dollars not gold? Notice any monumental criminality here?  Notice the plan below to stop this here and now;

http://www.zerohedge.com/print/365866

 

 

Thu, 10/13/2011 - 18:29 | 1771496 Nascent_Variable
Nascent_Variable's picture

Don't worry.  I'm sure Geithner will release a statement any minute that there's absolutely no risk of China and others dumping Treasurys.  Problem solved.

Thu, 10/13/2011 - 23:24 | 1772228 TheFourthStooge-ing
TheFourthStooge-ing's picture

Don't worry.  I'm sure Geithner will release a statement any minute that there's absolutely no risk of China and others dumping Treasurys.

Good God, NOOOOOO!!!

That would pretty much guarantee that it was Fuckin' On like Donkey King Kong.

Problem solved.

...yes...it's all so clear now........watch more television, and avoid panic buying....now I understand...

 

Thu, 10/13/2011 - 19:17 | 1771662 eureka
eureka's picture

I have been telling my fellow zerohedgers for a while that US needs China more than vice versa - and that China at some point may choose to dump its $3TRIL $US paper.

Well, here it is, the warning - and the proof. US is going down - in a short mattter of time.

Thu, 10/13/2011 - 21:29 | 1771993 kito
kito's picture

Wasn't it a few days ago that bernanke gave bonds away to a sold out crowd?

Thu, 10/13/2011 - 21:59 | 1772037 Ahmeexnal
Ahmeexnal's picture

just as a snakeoil salesman has his friends "buying" from him frantically, thus the idiotic fools who believe they are missing out on a wonderful product gladly exchange their silver schillings for a flask of putrid rat oil.

Thu, 10/13/2011 - 19:22 | 1771668 Perpetual Burn
Perpetual Burn's picture

More like cotton :)

Thu, 10/13/2011 - 18:12 | 1771429 tim73
tim73's picture

But but but...USA is SAFE HAVEN! Even JESUS would DEPOSIT! USA! USA! USA!

 

Thu, 10/13/2011 - 18:17 | 1771453 CClarity
CClarity's picture

Uh-oh.  What if the black swan is not the well telegraphed EU crisis.

What if it's Asia.  Where China's growth is slowing (imports and exports less already) and then BANG - flooding in Thailand, Vietnam, Philippines which are less able to afford natural disasters (or man-made ones) than Japan, and very dependent on their wagon being hitched to China's growth machine.  Just sayin . . . 

Thu, 10/13/2011 - 18:20 | 1771462 tim73
tim73's picture

Real floods in Asia cause liquidity crisis in the US and EU. That is poetic.

Thu, 10/13/2011 - 18:32 | 1771508 CClarity
CClarity's picture

Nice connect!

Ala "Let them eat rice CAKE" even though rice crop is being wiped out.  Who will rally?  India? Russia short on grains. Japan can't help.  Australia? Maybe.

Thu, 10/13/2011 - 18:59 | 1771604 Threeggg
Threeggg's picture

"Let them eat plastic rice CAKE"

 

There..............fixed it for you...you're welcome

Thu, 10/13/2011 - 20:44 | 1771902 DCFusor
DCFusor's picture

A black swan, by definition, isn't well telegraphed, it's what you never thought could happen.  No matter how bad Yurp gets, we know where it's going - so it can't be a black swan, just a really nasty normal swan.

Whether your other senario is the one, I couldn't say.  Possible.  It's prudent to plan for the unexpected.

It's mostly whiney losers who say things like "well, can't pay the rent because the car unexpectedly broke down, or the kid got sick".  Shit happens, all the time, and to everyone.  It's calling yourself stupid to say you don't know that and didn't plan for a little bit of shit to happen.

Fri, 10/14/2011 - 00:32 | 1772404 Prometheus418
Prometheus418's picture

As usual, you're mostly right, DC- 

I'm only replying to remind you not to harden your heart entirely.  While it's easy to sit up on the top of a hill and cast down your judgement, it's important to remember that breaking the bias you have been imbued with since birth is not something that most people can do- and even those of us that do it are left with remnants.

Some things just can't be planned for, and I suspect you know this.  That is where compassion, rather than a fist, is called for.  If we forget that, there isn't anything worth fighting for.  I spend a lot of my time these days extending a friendly hand to those whose past behavior is objectively repugnant to me, in the hopes that they have seen the errors of their ways.   Sometimes that charity clamps down on me until teeth hit bone, but the times when it wakes up another soul makes those missteps worthwhile.

One good lieutenant is worth taking a beating from a whole pack of wolves for- it's worth nothing to live alone on a mountain of gold, and you know that.

Fri, 10/14/2011 - 08:12 | 1772872 Snidley Whipsnae
Snidley Whipsnae's picture

No good deed goes unpunished...

that is an old saw and a comment on human nature... just the way life usually turns out.

Fri, 10/14/2011 - 08:34 | 1772923 Smiddywesson
Smiddywesson's picture

A black swan, by definition, isn't well telegraphed, it's what you never thought could happen.  No matter how bad Yurp gets, we know where it's going - so it can't be a black swan, just a really nasty normal swan.

No.  That's just theory.  Taleb himself admits that in practice there are always winners who saw it coming.   China dumping treasuries, gold rocketing to the moon, and the failure of the USD are black swans to most, and yet these events will not come as a surprise to anyone on this site.

You also might want to consider from your lofty perch that a lot of people who you call "whiny losers" are really victims of a society that educated them on the life of Harriet Tubman rather than provide them with any education on finance and money.  That goes for their parents too.  This society has done everything to impoverish them and despite working hard with two incomes a lot of people are living on the edge of survival.  Did they create inflation?  Did they bust the housing market?  Did they create the tax system, or the banking fees, or the hidden taxes on their cell phones?  How about health care, you know, the primary cause of bankruptcy? 

Putting moral labels on people for being unable to wisely handle money is like laughing at a little kid because he can't ride a bike.  Most people can't handle money wisely.  That's the way it is, that's the way it always has been.  People who do so think they are smarter or better than most, and maybe they are, but they should also consider that this moral labeling of the poor is a tool used by TPTB to coax useful idiots into supporting TPTB.

Thu, 10/13/2011 - 18:21 | 1771464 donsluck
donsluck's picture

Who is Jesus?

Thu, 10/13/2011 - 18:37 | 1771532 SemperFord
SemperFord's picture

Mexicans call him Chuy

Thu, 10/13/2011 - 19:33 | 1771715 Janice
Janice's picture

Jesus was the Jew who supported the Biblical teaching that the love of money is the root of all evil. If you consider this concept on a very deep level, I have found that it holds true for virtually every offense except crimes against persons, such as, rape. All other social injustices can be condensed to the love of money. Sorry folks, just a rant.

Thu, 10/13/2011 - 19:45 | 1771763 kito
kito's picture

So that's why gold is down as of now

Thu, 10/13/2011 - 19:55 | 1771784 ffart
ffart's picture

I thought it was the love of money for money's sake. 

Thu, 10/13/2011 - 23:00 | 1772167 delacroix
delacroix's picture

the love of other peoples money

Fri, 10/14/2011 - 01:04 | 1772491 Bananamerican
Bananamerican's picture

stomach-money-power-Power over another man's stomach...

Thu, 10/13/2011 - 22:07 | 1772047 Ahmeexnal
Ahmeexnal's picture

money is the root of all evil

Francisco D'Anconia was wise in advising anyone who cared to learn from him to run away from fools like you.

 

Money is only a tool. It's POWER what's at the root.  And when money goes to zero, like it will in a few days time...power comes from the barrel of a gun.

Thu, 10/13/2011 - 22:51 | 1772147 Dingleberry
Dingleberry's picture

You're the fool. Big pharma doesn't push useless drugs for power. They do it for money. Lawyers don't oversharge their clients for power. They do it for money. Politicians don't take bribes for power. They do it for money. That's why when they leave governemnt they get money-making jobs afterwards. Pimps don't beat their whores for power. They do it for money. Lloyd, jamie, et al don't lie, cheat and steal from each other and everyone else for power. They do it for money. Money equals power, but power doesn't always equal money. EVERYONE WANTS MONEY....just like God said they would.

Thu, 10/13/2011 - 23:54 | 1772309 Phil Free
Phil Free's picture

Nay, is the same, for the money is traded for power.  More money = more power.

Fri, 10/14/2011 - 00:15 | 1772368 Raymond Reason
Raymond Reason's picture

Jesus, who many of us believe is God, speaks in truths alone, and men have spent centuries uncovering the layers of truth embedded in his every utterance.  The "root of evil" being one.  Money, real money, in other words gold, silver, non-perishable or at least long-lasting commodities are a store of value, and this is where the evil starts.  Hunter-gatherers entered the agrarian age and had something to save, protect, guard, insure, loan, transport, tax, and on it goes.  Money is a Pandora's box.  

Not saying Jesus was against money or civilization...He readily acknowledged the world is, by design an evil place.     

Fri, 10/14/2011 - 00:44 | 1772439 AustriAnnie
AustriAnnie's picture

Money, arising in a world of scarce resources, as a way of working for/storing/and obtaining those resources voluntarily through exchange.

The other option being by force.

When force is used to obtain money or control money, it is not money that is evil.  It is the fact that force is being used to control (here's where the power comes in) resources.

The world is evil because resources are scarce.  The world would be all rainbows and unicorns if money were not necessary to signal the value of resources because resources were abundant and unlimited.  However, resources are not.  Prices signal the subjective valuations of individuals and therefore control allocation of resources.  If someone steals your food, food is not evil.  The person who stole it is.  If someone steals that with which you buy food, money, then money is not evil.  Money is just a substitute for resources.  Resources are not evil.  Evil actions arise when goods are stolen.  It is the thief who is evil.

Money is the power that signals value in a market.  If not for money, pure force would be the way resources are obtained.  Which is more evil, then?

Fri, 10/14/2011 - 01:10 | 1772505 Bananamerican
Bananamerican's picture

Jesus...readily acknowledged the world is, by design an evil place.

"love" of money, deceit, vanity, the 7 deadlies...all of it used to gain advantage in this world, this transitory Life which passes away...

A Christian was warned (before "Prosperity Evangelism" anyway) to "Keep your eyes on the Prize"...

"I am but a Stranger Here. Heaven is my home"

Fri, 10/14/2011 - 00:38 | 1772422 Prometheus418
Prometheus418's picture

Power never comes from a barrel of a gun.

Power is what makes those whose lives are expendible to the powerful pick up those guns.  Power comes from the mind, and it's ability to influence others.

Thu, 10/13/2011 - 22:01 | 1772040 Ahmeexnal
Ahmeexnal's picture

Hey-Zeus == Choo Choo (from Top Cat).

Thu, 10/13/2011 - 18:52 | 1771586 Schmuck Raker
Schmuck Raker's picture

What did he know?

When did he know it?!

Thu, 10/13/2011 - 19:36 | 1771724 DosZap
DosZap's picture

donsluck,

Well he's either your Hispanic cook, or gardener, or your only ticket out of this world.

Take your choice.

Thu, 10/13/2011 - 22:08 | 1772059 Ahmeexnal
Ahmeexnal's picture

he should offer more virgins in the afterlife than the other dude

Thu, 10/13/2011 - 23:56 | 1772314 Phil Free
Phil Free's picture

My gardener? (Ok, 'landscaping guy'.)

Thu, 10/13/2011 - 18:12 | 1771430 jdelano
jdelano's picture

Just so some other jackass doesn't get the chance to say it,

Bullish.

Thu, 10/13/2011 - 18:42 | 1771550 CrockettAlmanac.com
CrockettAlmanac.com's picture

Bitchez!

Thu, 10/13/2011 - 18:58 | 1771597 jdelano
jdelano's picture

Tee hee! That brings the count up to SIX idiots who were just dying to say it. So many of you abjectly uncreative herd-following ass hats, completely incapable of generating even so much as a single original thought--there you go zh, I've just discovered a fail-safe contrarian indicator : )

Thu, 10/13/2011 - 18:12 | 1771433 achmachat
achmachat's picture

that is a lot of billions.
Wonder what it would look like in cash.

Thu, 10/13/2011 - 20:45 | 1771903 SystemsGuy
SystemsGuy's picture

Imagine a twinkie. Now imagine a twinkie ten miles long, growing at the rate of 1 cubic mile every thirty days or so. T'is truly an enormous amount of oil-based cream filling.

Thu, 10/13/2011 - 21:26 | 1771988 CrimsonAvenger
CrimsonAvenger's picture

I have GOT to remember not to come here when I've got the munchies.

Thu, 10/13/2011 - 22:53 | 1772154 seek
seek's picture

He got to me. I happened to be stopping by the store after reading this, and I indeed acquired the lucious, golden spongecakes.

Got to enjoy them before they're no longer available and the remaining stock is eaten by post-financial-apocalypse zombies.

Thu, 10/13/2011 - 23:59 | 1772320 Phil Free
Phil Free's picture

Cue Carl Sagan from 'Cosmos', as he gestures at a star-filled night sky -- "..billy-ons and billy-ons.."

Fri, 10/14/2011 - 01:14 | 1772516 Bananamerican
Bananamerican's picture

that was 1980 man...

"TRILL-ions of ephemeral bank notes Der-ifting through the interstellar gases"

Thu, 10/13/2011 - 18:12 | 1771434 Xibalba
Xibalba's picture

bullish

Thu, 10/13/2011 - 18:13 | 1771437 jdelano
jdelano's picture

Too late

Thu, 10/13/2011 - 21:38 | 1772005 lano1106
lano1106's picture

IMO, it could be bearish for equities. If the massive bond selloff is problematic for the US TPTB then they could create a beautifull flash crash in equities to shit scare investors back into the US T-bond safe heaven.

 

Fri, 10/14/2011 - 00:54 | 1772471 Calmyourself
Calmyourself's picture

umm, who are these investors and why are they so stupid?

Thu, 10/13/2011 - 18:12 | 1771436 I think I need ...
I think I need to buy a gun's picture

Bond run bitchez

Thu, 10/13/2011 - 18:14 | 1771439 RobotTrader
RobotTrader's picture

 

 

Then who is buying these Uncle Gorilla notes hand over fist, driving yields on the long end of the curve down to 50-year lows?

Must be Uncle Gorilla himself.

Don't they call that "cannibalisim"??

LOL....

Thu, 10/13/2011 - 18:29 | 1771497 nope-1004
nope-1004's picture

No, the correct name is Ponzinomics.  Liar Ben is head of the department.

 

Fri, 10/14/2011 - 00:01 | 1772323 Phil Free
Phil Free's picture

Ponzinomics -- That's a good one.. Will have to remember.

Thu, 10/13/2011 - 18:36 | 1771526 SheepDog-One
SheepDog-One's picture

Gee Robo maybe its like Ive been telling you for months replying to your wild-eyed posts about how great bonds are....when youre getting new credit cards to pay on your other maxed out ones, youre fucked.

Thu, 10/13/2011 - 21:25 | 1771984 dark pools of soros
dark pools of soros's picture

not really..   he who spends the most wins,  not he who pays the most back -   eventually one oz of gold will pay off all your debts so why do you NOT want to spend as much fiat credit as possible??

Fri, 10/14/2011 - 00:02 | 1772327 Phil Free
Phil Free's picture

He who dies with the most toys wins.

Thu, 10/13/2011 - 19:05 | 1771623 spinone
spinone's picture

Once the fed starts buying treasuries, it will have to buy them all.

Thu, 10/13/2011 - 21:09 | 1771962 Peterpaul
Peterpaul's picture

It is Ouroboros, chomping on his own tail...

Fri, 10/14/2011 - 00:05 | 1772334 Phil Free
Phil Free's picture

Also spelled -- Uroborus.  Add an E -- EUroborus?   ..... Co-incidence, or more?  You be the judge. 

 


Thu, 10/13/2011 - 18:14 | 1771440 junkyardjack
junkyardjack's picture

Wouldn't have anything to do with the massive run up in the stock market would it?

Thu, 10/13/2011 - 18:34 | 1771518 SheepDog-One
SheepDog-One's picture

There was a 'massive run up in the stock market' when did I miss that? I just pulled up a chart and the DOW sits at 1999 levels.

Fri, 10/14/2011 - 02:16 | 1772573 Ultros88
Ultros88's picture

May I suggest new rules for fundamental stock valuation?

 

1. Any company that does not pay, nor has any set timeframe for paying dividends, should have a stock price of zero.

2. Stock price is to be determined by the future expected payout of dividends as projected from past payments to stockholders, or by discounting expected future payments.

 

If I owned a company and only made money when I sold it, was I ever making any money?

That's the problem with this stock valuation bullshit.

 

tick... tock... carve the mother-fucking rock.

Thu, 10/13/2011 - 18:15 | 1771441 SparkySC
SparkySC's picture

DOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOM!!!!!!!!!!

Thu, 10/13/2011 - 18:42 | 1771549 disabledvet
disabledvet's picture

how's that for going "outside the box"?

Thu, 10/13/2011 - 19:38 | 1771732 kill switch
kill switch's picture

fucking effective

Fri, 10/14/2011 - 00:07 | 1772336 Phil Free
Phil Free's picture

LLLLLLLLLLLLLLEEEEEEEEERRRRRRR­RRRROOOOOYYYYYYYY JJJJJJJJJJJJJJJEEEEEEEENNNNNNN­NNKKKKKKIIIIIIIIIIINNNNNNNNNNS­SSSSSSSSS!!!!!!!!!!!!!!!!!!!!!­!!!!!!!!!!!!!!!!!!!!!!!!

Thu, 10/13/2011 - 18:15 | 1771442 EZT
EZT's picture

Maybe they are using the monye to buy stocks!

Thu, 10/13/2011 - 18:28 | 1771495 X.inf.capt
X.inf.capt's picture

Maybe,ezt...

maybe its phyiscal PM's.....

they seem to be holding thier own against the onslaught of margin hikes....

Thu, 10/13/2011 - 18:54 | 1771587 Manthong
Manthong's picture

I don't know how smart it is to be buying stocks at a time when global markets are contracting.. how many iPods are needed by an unemployed populace?

Thu, 10/13/2011 - 19:37 | 1771727 Janice
Janice's picture

Soon they will be given out for free, like the cell phones.....and they'll use taxpayer dollars to advertise them on tv

Thu, 10/13/2011 - 20:46 | 1771909 SystemsGuy
SystemsGuy's picture

Or lead ...

Thu, 10/13/2011 - 18:16 | 1771444 desirdavenir
desirdavenir's picture

(too?) simple explanation: european banks need the cash, and they sell the bonds they have to obtain it.

 

Thu, 10/13/2011 - 18:18 | 1771457 jdelano
jdelano's picture

Chinese announced several weeks ago they'd be selling treasuries to buy prime us equities like apple---don't see any reason to doubt it

Thu, 10/13/2011 - 18:33 | 1771512 SheepDog-One
SheepDog-One's picture

Gee you'd think China could have identified buying apple a few hundred points lower might have been the real good prime trade?

Thu, 10/13/2011 - 22:02 | 1772045 myne
myne's picture

Might as well nationalise your best brands. ;)

Fri, 10/14/2011 - 02:12 | 1772570 desirdavenir
desirdavenir's picture

selling treaurys, yes, probably, s it is a fact. But buying stocks ? This is an intention, actually a justification, and as long as I don't see it, I won't believe it. The dollar cash could also be scarce in China,for example in its banking system. I'm still waiting to act on this, but consider go very long the dollar once the cash has been raised...

Thu, 10/13/2011 - 18:17 | 1771451 tim73
tim73's picture

Unintended consequences are a bitch. Yanks and Brits start whispering Eurobanks are short of cash. Euros start wondering where to get more cash...they got some Shiny Yank Bonds! BINGO!

Thu, 10/13/2011 - 18:17 | 1771452 FunkyMonkeyBoy
FunkyMonkeyBoy's picture

Anything with 'Made in the USA' on it should be dumped immediately out of moral principal.

Thu, 10/13/2011 - 18:26 | 1771466 legal eagle
legal eagle's picture

Lets see, there are New Balance running shoes,,,,,,,and, and,,,,,,,,and that is pretty much it.

Not really, people forget that only in 2010 did China surpasse USA in manufacturing.  We still make lots of stuff........

Take a look here:  http://www.americansworking.com/

 

Thu, 10/13/2011 - 18:31 | 1771506 JayParamedic
JayParamedic's picture

Cool site. I'm gonna start shopping for products from there.

Thu, 10/13/2011 - 19:33 | 1771713 morkov
morkov's picture

hope that's not all. i have the same list for products from bulgaria  LOL

 

Thu, 10/13/2011 - 19:28 | 1771688 catacl1sm
catacl1sm's picture

Since almost 50% of the population is poor enough to not pay taxes, where do you think they'll shop? Let's compare:

$62.20 for Made in USA CD-R's or

$24 for Made in NOT USA CD-R's

I'm not saying it's right or wrong, just stating the fact.

http://www.mam-a-store.com/mam43992usa-50.html

http://www.staples.com/Staples-50-Pack-700MB-CD-R-Spindle/product_452555

Fri, 10/14/2011 - 00:50 | 1772460 DavidAKZ
DavidAKZ's picture

Well you migh consider the humans that were involved in $24 model are either in prison or dead. It's ok until it affects you I suppose.

Fri, 10/14/2011 - 04:09 | 1772642 Gief Gold Plox
Gief Gold Plox's picture

These two items are not comparable. The made in the USA is a printable disc. Whereas the other atricle is just an ordinary crap CDR.

What you should be comparing is:

http://www.staples.com/Staples-50-Pack-CD-R-Printable-Spindle/product_59...

http://www.mam-a-store.com/mam43992usa-50.html

Thu, 10/13/2011 - 23:36 | 1772260 bigkahuna
bigkahuna's picture

bookmarked. thanx

Thu, 10/13/2011 - 22:52 | 1771546 sitenine
sitenine's picture

What do you have against US manufacturing?

You think US citizens have too many job opportunities or what?

If anything, end the Fed out of moral principle!

Thu, 10/13/2011 - 18:45 | 1771560 falun bong
falun bong's picture

yeah and also for moral principle

Thu, 10/13/2011 - 20:44 | 1771853 Loose Caboose
Loose Caboose's picture

@ FunkyMonkeyBoy who said:

Anything with 'Made in the USA' on it should be dumped immediately out of moral principal.

Does that include your avatar?

Thu, 10/13/2011 - 18:18 | 1771458 legal eagle
legal eagle's picture

I wish PMs could make a move, it has been pretty boring lately.

It seems that the same manipulation that has held silver steady is now being applied to gold, not up or down much, just sidewinding forever......

I needs me some new walking shoes...

Thu, 10/13/2011 - 18:23 | 1771474 I think I need ...
I think I need to buy a gun's picture

i think its safe to say your move will happen overnight and it will be the BIG ONE!

Thu, 10/13/2011 - 18:25 | 1771482 legal eagle
legal eagle's picture

From your post to God's ears!

Thu, 10/13/2011 - 18:36 | 1771529 MsCreant
MsCreant's picture

Consolidation at these levels is not a bad thing. It was going up too fast, too soon. Look at the trend line. 1630-1650 is about right. 1900 was way off the mark. Patience, friend.

Thu, 10/13/2011 - 18:48 | 1771569 legal eagle
legal eagle's picture

Are we there yet?  Huh?  Are we, are we?

Actually better if we do not get a run up this year.  At year end, plan on buying a bunch more.

Still, $1,900 was fun!

Thu, 10/13/2011 - 23:59 | 1772321 IrritableBowels
IrritableBowels's picture

Me too.  Somewhere shortly after New Years, planning on cashing out 401K.

Thu, 10/13/2011 - 21:07 | 1771957 seek
seek's picture

While I agree in principle, the current world financial situation is far too screwed up for gold to be as low as it is -- I think what we're really looking at isn't consolidation, but active management to create room for more sudden jumps upward without setting new records.

Of course, as has been noted many times here, they're rapidly using up the dry powder on this manipulation. When AU launches it's going to be a sight to behold.

We're getting closer. Charts like the one above make that abundantly clear.

Fri, 10/14/2011 - 00:46 | 1772443 Prometheus418
Prometheus418's picture

Consolidation at these levels is not a bad thing. It was going up too fast, too soon. Look at the trend line. 1630-1650 is about right. 1900 was way off the mark. Patience, friend.

Agreed.  But I liked $40/oz for Ag- it's undervalued right now.

Thu, 10/13/2011 - 19:24 | 1771674 DosZap
DosZap's picture

legal eagle

You will get your MOVES,and if the EU melts down, you won't like the results.

Reserve Currency status has thus far saved the US's ass.When ever that ceases for real, or in global minds......best be buckled up,HypreInflation, #1,and civility will be a word in the dictionary here.

Thu, 10/13/2011 - 23:34 | 1772256 TheFourthStooge-ing
TheFourthStooge-ing's picture

I wish PMs could make a move, it has been pretty boring lately.

They'll make their move. In the meantime, cherish the boredom while it lasts.

 

Thu, 10/13/2011 - 18:21 | 1771465 The4thStooge
The4thStooge's picture

Escalating, the Trade Wars are.

Thu, 10/13/2011 - 20:38 | 1771887 s2man
s2man's picture

Hey.  Where did Shemp go?

Thu, 10/13/2011 - 22:11 | 1772065 MisterMousePotato
MisterMousePotato's picture

I try to think ... but nuthin' happens.

Thu, 10/13/2011 - 23:36 | 1772259 TheFourthStooge-ing
TheFourthStooge-ing's picture

Hey.  Where did Shemp go?

You rang? Oops, wait, that line belongs to Lurch.

 

Thu, 10/13/2011 - 18:27 | 1771468 Zero Govt
Zero Govt's picture

No worries... the 'Super Committee' will sort this out

You think i'm kidding???

I listened to a Senator on that cackling pile of worthless garbage, CNBC, today. He simply couldn't wait, and had every faith in, the Super-Committee leading the country to the promised land.

Ok you might think you've got a Congress to sort out all the problems they were elected to do but no. They've failed... miserably

Ok you might think you've got a Senate to sort out all the problems they were elected to do but no. They've failed ...miserably too

Ok you might think you've got a US President to sort out all the problems he was elected, and promised, to but no. He's failed ...fuking miserably 

So 3 political bodies, not to mention 300 Committees of 'wise men' (corrupt useless over-paidold  farts), and this Senator who was elected to do something have all failed. So where do these 4 'Super (Committee) Men' come from that can shine new light on the problems where the miserable failures of the Congress, Senate and President have failed?

Er, that'll be the House Speaker, a Republican and a Democrat and ..well who cares... it's the same bunch of losers, a selection of the same failed wasters, the same leaderless blind retards that got themselves into this mess. 3 political bodies fail completely and they expect a silk purse to come from the 4th attempt (same genetic strain of pigs ear).

This Super-Committee is the most shambolic application of Lipstick on Gods earth... this clueless Senator was moronic to the point of being insane, a pretty typical guest on CNBC

Thu, 10/13/2011 - 18:30 | 1771500 LongSoupLine
LongSoupLine's picture

I saw that and wanted to drive his teeth down his piehole

Thu, 10/13/2011 - 18:34 | 1771515 Zero Govt
Zero Govt's picture

i was dumbfounded at the dumbness (!) of this bloke ...the lunatics have taken over the asylum, and they haven't got a clue what to do!!! ...words fail me, the Senator was sooooooooooo fuking thick

Thu, 10/13/2011 - 18:40 | 1771545 hambone
hambone's picture

Ohhhh gooodie, a chance to watch a dumb senator...I tire of watching the smart ones.

Any chance for a link or the senators name?

Thu, 10/13/2011 - 18:45 | 1771563 CrockettAlmanac.com
CrockettAlmanac.com's picture

Wesley Mouch.

Thu, 10/13/2011 - 18:57 | 1771595 hambone
hambone's picture

Shrug

Fri, 10/14/2011 - 00:12 | 1772352 Phil Free
Phil Free's picture

Wesley Crusher?

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