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Here's Hilsenrath With What To Expect Tomorrow

Tyler Durden's picture




 

First thing this morning we tweeeted:

We were off by 14 minutes, as today's "Hilsenrumor" appeared at 3:26 pm, giving the market its closing oomph.

By now everyone knows that the WSJ's Jon Hilsenrath is spoon-Fed information directly by the Fed. Even the Fed. Which is why everyone expected the Fed to ease last time around per yet another Hilsenrath leak, only to be largely disappointed, invoking the term Hilsen-wrath.

Sure enough, it took the market only a few hours to convince itself that "no easing now only means more easing tomorrow", and sure enough everyone looked to the August, then September FOMC meetings as the inevitable moment when something will finally come out.

So far nothing has, as the Fed, like the ECB, have merely jawboned, since both know the second the "news" is out there, it will be sold in stocks, if not so much in gold as Citi explained earlier.

Regardless, the conventional wisdom expectation now is that tomorrow the Fed will do a piecemeal, open-ended QE program, with set economic thresholds that if unmet will force Bernanke to keep hitting CTRL-P until such time as Goldman is finally satisfied with their bonuses or unemployment drops for real, not BS participation rate reasons, whichever comes first.

As expected, this is what Hilsenrath 'says' to expect tomorrow, less than two months from the election, in a move that will be roundly interpreted as highly political, and one which as Paul Ryan noted earlier, will seek to redirect from Obama's economic failures, and also potentially to save Bernanke's seat as Romney has hinted on several occasions he would fire Bernanke if elected. Here is what else the Hilsenrumor says. 

From the WSJ:

In the past, it has announced programs with big numbers and fixed completion dates — like a $1.25 trillion mortgage-buying program that stretched 12 months through March 2010 and a $600 billion Treasury bond-buying program that stretched eight months through June 2011.
The activist wing of Fed officials, which support aggressive responses to high unemployment, want a large and open-ended commitment to bond buying. For instance, the Fed could announce it would buy at least a certain amount of bonds over a specified time period and signal they could buy more later if the economy doesn’t pick up.

Announcing an opening allotment over several months would blunt the ability of Fed policy hawks, who are skeptical of easing actions, to quickly call for the program to end. The hawks don’t want another round of QE, but if there is going to be one, they would want a small up-front commitment to bond buying and the opportunity to pull the plug on the program if the economy picks up quickly.

A four-month opening allotment would get the Fed past the election and through a Dec. 11-12 policy meeting, at which point it could consider whether to continue. A five month commitment could get it to a January press conference and another round of forecast updates. A seven-month opening allotment would get it through the first quarter of 2013 and to a March 19-20 policy meeting. If it decides to make decisions on a meeting-by-meeting basis, the next meeting is Oct. 23-24, two weeks before the election.

It’s hard to say how big a program the Fed would launch, here are some guideposts:

  1. The Fed is already purchasing $45 billion in long-term Treasury securities every month through the Operation Twist program and it plans to buy a total of $267 billion by year-end. That marks the lower bound of what Fed purchases will be for the rest of the year.
  2. If the Fed doubles the size of its current program by matching Treasury purchases with mortgage purchases, that would get its monthly purchases to $90 billion.
  3. Its controversial QEII program launched in November 2010 was smaller at $75 billion per month.
  4. Its first round of mortgage and Treasury purchases took place largely in 2009 and was designed to be immense to address the financial crisis. It amounted to more than $140 billion per month, an amount that seems likely to be far beyond the ambitions of what Fed officials are prepared to do now.

–WHAT TO DO WITH TWIST: Officials must decide what to do about the “Operation Twist” program if they launch a new bond-buying program. The Fed is funding the Twist purchases with money it gets by selling short-term Treasury securities. The Fed has two options:

  1. It could suspend the Twist program and replace it with a new bond-buying program in which it buys both Treasury securities and mortgage-backed securities, and funds those purchases with money that the Fed prints — rather than with proceeds from short-term securities sales. This would be more like the QE programs the Fed launched in March 2009 and November 2010.
  2. The Fed could continue the Twist program and launch a mortgage-bond-buying program by its side in which it buys mortgage bonds with newly printed money but continues to fund long-term Treasury purchases with sales of short-term securities.

In either case, the Fed would be launching a program which it considers to be more powerful than Operation Twist alone. One question for officials is which of these two complex approaches would be easiest to explain to the public? Another is which approach entails less risk of public backlash? Many critics worry that the Fed’s money printing will someday cause inflation or another financial bubble. Many officials don’t agree, but they’re sensitive to the argument. The second option would involve less money printing and might help to blunt that criticism.

COMMUNICATION: How the Fed describes its impetus for action, and its criteria for even more in the future, could matter a lot. Is it responding to a darkening outlook? Or has it decided to take more aggressive action because its patience with slow growth and high unemployment is running out and it has a new commitment to changing that?

If it emphasizes the former, it might just depress investors, households and businesses more and backfire. If it emphasizes new resolve, it could spur the public to change behavior in ways that lead to more economic growth but also risk more inflation.

Fed officials have long believed that their communications about monetary policy and the economy are as important as the actions they take, but they’ve struggled to strike the right message.

In a widely debated paper presented at the Fed’s Jackson Hole meeting last month, Columbia University economist Michael Woodford argued that the Fed should signal more strongly that it is committed to an easy money policy until the economy meets benchmarks for more output. The Fed seems to be moving tentatively in this direction. Its discussion about open-ended bond buying is one potential example.
Another: Minutes of the July 31-Aug. 1 policy meeting showed officials considered offering a new assurance that short-term interest rates will stay low even after the recovery progresses.

WHETHER TO LOWER ANOTHER RATE: The Fed now pays banks 0.25% interest on reserves they keep with the central bank. The Fed could reduce the rate it pays on reserves that aren’t required of banks (known as excess reserves) a little bit to try to give banks more impetus to lend. However many officials are reluctant to do so because they’re afraid pushing the rate any lower would disrupt short-term lending markets. It’s unclear whether the Fed will do anything on this front, especially with so many other hard decisions on the table.

 

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Wed, 09/12/2012 - 16:34 | 2787335 Meesohaawnee
Meesohaawnee's picture

Who cares..

Wed, 09/12/2012 - 16:38 | 2787353 Concentrated po...
Concentrated power has always been the enemy of liberty.'s picture

Bernanke is a pimp

Wed, 09/12/2012 - 16:43 | 2787356 idea_hamster
idea_hamster's picture

The Fed now pays banks 0.25% interest on reserves they keep with the central bank. The Fed could reduce the rate it pays on reserves that aren’t required of banks (known as excess reserves) a little bit to try to give banks more impetus to lend. However many officials are reluctant to do so because they’re afraid pushing the rate any lower would disrupt short-term lending markets. It’s unclear whether the Fed will do anything on this front, especially with so many other hard decisions on the table.

Sorry for being as thick as a plank, but could someone please explain:  how the f'k would cutting the excess reserve interest rate (back!) to 0% "disrupt" short-term lending markets?  "Disrupt" sounds like liquidity would be sucked out, making it more difficult to roll over financing, but that's the exact opposite of what the cut would do, no?

Or is today opposite day?

Wed, 09/12/2012 - 16:47 | 2787388 Michael
Michael's picture

Thank the Creator nobody watches or reads the Jewtube MSM TV news anymore, as their ratings bear that out.

Their not going to be able to brainwash us into doing what they want and dieing for them this time around.

Wed, 09/12/2012 - 17:15 | 2787477 American34
American34's picture

Wanna be a Fed Super Star, print large, big Bens, armored cars, live large...printin outa my basement gonna screw everybody...gonna print for Obama he is my buddy.

Wed, 09/12/2012 - 17:36 | 2787548 NotApplicable
NotApplicable's picture

You ever have big dreams of makin' big green?

Big shot, heavy hitter on the mainstream

You wanna look trendy in the Bentley

Be a star and never act friendly

Wed, 09/12/2012 - 17:51 | 2787588 American34
American34's picture

So you wanna be a Fed superstar?

And print large, Big Bens, armored cars, you’re in charge

Printin outa ya basement screw every body

Gotta order more and more ink constantly


I remember the days when I was a young kid growin' up

Never inflate above 3 never blow it up
The Fed crowd, print money, chill with the honey's

Sign autographs for whatever the printer wants from me

It’s funny how inflation manifests
The prices that be comin' with it, nevertheless

You got to print for the gusto but you don't know

About the blood, sweat and tears and savings lost in years

And bleeding all of your savings to days past gone by
Makin it all manifest for the rich guy
Egomaniac and the brainiac don't know how to act
Bens deep, 6 feet, pallets sweet
Fed Master Ben signed the deal, thinks he's print make a tril'
But always will 'til he crosses over
Still draining your head and savings free
Come with me, show the sacrifice it takes to print in the T’s
You wanna be a Fed superstar in the biz?
And take savings from people who don't know what it is
I wish it was all fun and games but the price of elections is high
And most can't pay the way
Still trapped in what you printin' about
Tell me what happens when the dollar loses clout
The route you took started collapsing
No votes, no bribes, no respect, no change, no women
And everybody craps on your name

Wed, 09/12/2012 - 17:57 | 2787607 TruthInSunshine
TruthInSunshine's picture

As has been said on here before by many, non-stop QE has been ongoing for years. To QE3 or to not QE3 tomorrow has long been a moot point.

Nothing will get the sheeple angrier, in a crazed and frenzy state, to the point of wandering & meandering the streets, violently and randomly stealing/breaking/torching shit, like $5.50/$6.50 per gallon gasoline/diesel and 10%/then20%/then30% higher from here food-and-everything-else costs.

The sheeple, when engaged in random and misdirected acts of mischevious destruction, in an inarticulate grunt attempting to express their rage, not knowing who to precisely target, will feel only temporarily better after each cathartic wave of destruction, and the extent of damage from their more and more frequent "demonstrations" will build and grow with each successive one.

 

The Bernank's famous last words, before he flees 33 E. Liberty Street like pond scum in the night, flames set to buildings in the foreground and background, will be:

 

"I had to kill the Federal Reserve Note [what some still adoringly call the U.S. Dollar] to save it."

Wed, 09/12/2012 - 19:17 | 2787728 RSloane
RSloane's picture

I can't +1 you, but I would if I could. The only doubt I have about your post is that Americans would have to get out of their lounge chairs, turn off the TV, put down the chips, donuts, and beer or diet Coke, and actually wander around outside possibly in inclement weather. Destruction of property requires a lot of energy expenditure and I'm just not sure Americans are up for that. I could be very wrong and selling them short. I hope very much I'm wrong because nothing is going to change until people in large quantities, from all walks and races, hit the streets in anger.

Wed, 09/12/2012 - 19:36 | 2787802 White.Star.Line
White.Star.Line's picture

My vote for one of the greatest posts, from one of the GREATEST POSTERS on Zerohedge, of all time.

His name was Robert Paulson.....................

Wed, 09/12/2012 - 21:19 | 2788006 chump666
chump666's picture

haha

that was good.

Wed, 09/12/2012 - 22:03 | 2788058 cdude
cdude's picture

"...meandering the streets, violently and randomly stealing/breaking/torching shit..."

The proverbial breaking of windows as per the Keynesian dream?  

Wed, 09/12/2012 - 17:39 | 2787560 metastar
metastar's picture

"Unlimited" Bitchez (regardless of whatever the FED says at any particular meeting). One must merely read between the lies.

Wed, 09/12/2012 - 19:57 | 2787836 White.Star.Line
White.Star.Line's picture

I can read between the lines..............

Unlimited corruption.

Unlimited Coercion....

Unlimited theft....

Unlimited currency destruction...

Unlimited sovereign destruction...

Unlimited restriction of freedom...

Unlimited depreciation and commodization of the human spirit..

Unlimited destruction of wilderness....

Unlimited death...

Up agsinst LIMITLESS LIFE.

Sorry you lose,

Go away fuckers.
We win.

Wed, 09/12/2012 - 21:10 | 2787993 lakecity55
lakecity55's picture

"Occupy" is an integral part of the "Arab Spring" and the color revolutions.

They are also allied with the muslim brotherhood.

Thu, 09/13/2012 - 04:38 | 2788521 Terp
Terp's picture

With press credentials hanging from their necks.

 

Yeah, right.

Wed, 09/12/2012 - 17:15 | 2787476 rawsienna
rawsienna's picture

Michael  - You can get you point across without the anti-jewish remarks.  

Wed, 09/12/2012 - 17:48 | 2787581 Michael
Michael's picture

The word Jew is not a curse word.

I have plenty of Jewish relatives, trust me, they know too.

Wed, 09/12/2012 - 18:34 | 2787683 ejmoosa
ejmoosa's picture

Actually this is a good example of how the Feds destroy value.

In their possession they are only worth the gold they contain....

And they will collect no taxes on them....ever.

Wed, 09/12/2012 - 22:39 | 2788115 ArrestBobRubin
ArrestBobRubin's picture

Michael, in my neck of the woods it's known as Talmudvision.

The term pretty well sums it up its "value proposition".

Wed, 09/12/2012 - 17:04 | 2787444 Dr. Engali
Dr. Engali's picture

It would screw up the money market funds which would technically be giving investors a negative rate of return due to fees. In other words breaking the buck. There are rules in place to prevent them from doing that but lowering the overnight rate would do just that. This would cause some funds to close disrupting credit to borrowers( withdrawing liquidity).

Wed, 09/12/2012 - 17:11 | 2787467 Comay Mierda
Comay Mierda's picture

rate wont get cut.  and no QE3 announcement

QE has been going on behind the scenes. Fed/primary dealers have been monetizing govt deficits since 2007. Look at the Fed Z-1 Report, specifically at the total change in credit outstanding for the federal government over the last 5 years.  Then look at how much federal govt debt has increased over the last 5 years. its damn near equal

Ben is saving his political pull for when the banks start falling like dominoes after the global market rejects the petrodollar and rates explode upward.  You will see the TARPx10

Wed, 09/12/2012 - 17:17 | 2787486 idea_hamster
idea_hamster's picture

It would screw up the money market funds 

OK, but I didn't think that MMFs held excess reserves with the Fed -- isn't this only depository institutions?

I would have thought that the MMFs are more likely to be in competition with the Fed excess reserve rate for over-night and <30-day funds, while holding short-dated paper.  This would suggest that if the Fed exits the over-night market, MMF funding would be cheaper and their net interest margins would expand.

Am I missing it?

Wed, 09/12/2012 - 17:54 | 2787602 spastic_colon
spastic_colon's picture

bingo - and what "high unemployment" are they talking about?  It is coming down quickly now <sarc> plus what does QE have to do with unemployment, proof please mr. chairbeard

Wed, 09/12/2012 - 17:22 | 2787495 bloostar
bloostar's picture

Further, this presupposes the lendee wishes to take out or ask for the said loan being forced upon a bank to be loaned out. I don't want it, do you?

How does one forcea bank to lend if nobody gives a hoot about the bank and doesn't want the loan?

Wed, 09/12/2012 - 17:32 | 2787531 idea_hamster
idea_hamster's picture

I agree -- but don't pay the bank 0.25% on all that money sitting at the Fed.  

That's a 100% bull-crap stealth bail-out, and I don't want my taxes funding it -- my taxes should be dedicated to funding elementary school acoustic guitar classes that teach kids to sing Kumbaya.  Oh, and Hellfire missiles.

Wed, 09/12/2012 - 17:36 | 2787547 DosZap
DosZap's picture

I agree -- but don't pay the bank 0.25% on all that money sitting at the Fed.

 

WHY pay them ANYTHING,to hold it?........................cut it to 0.05%.

Either way it's FREE fiat profits.

Wed, 09/12/2012 - 17:56 | 2787610 idea_hamster
idea_hamster's picture

Until recently, the rate was just plain 0% -- and that's where I think it should be cut back to, if not negative.

After all, if we all get negative real rates on our deposits, why shouldn't JPM?!

Wed, 09/12/2012 - 17:29 | 2787519 CosmicDebris
CosmicDebris's picture

I thought Tataglia was the pimp.  Bernanke more the hooker.

 

Had to get a Godfather reference at least once here. Sorry.

Wed, 09/12/2012 - 20:26 | 2787898 CrockettAlmanac.com
CrockettAlmanac.com's picture

Tattaglia is a pimp. He could have never outfought Santino. But I didn't know until this very day that it was Barzini all along.

Wed, 09/12/2012 - 18:00 | 2787620 piceridu
piceridu's picture

It was Barzini all along...

Wed, 09/12/2012 - 18:40 | 2787699 WhiteNight123129
WhiteNight123129's picture

Bernanke is a great guy, he just managed to create wage inflation in fact, and that will mean stagflation and that will pull the the consumer out of his debt, and that will fuck bond holders and equity holders. BERNANKE YOU ARE THE HERO, BY FUCKING THE CAPITAL OWNERS.

Wed, 09/12/2012 - 22:24 | 2788092 SokPOTUS
SokPOTUS's picture

That would be the Worst. Porn. Ever.

Wed, 09/12/2012 - 22:24 | 2788093 SokPOTUS
SokPOTUS's picture

x

Wed, 09/12/2012 - 16:36 | 2787341 LongBalls
LongBalls's picture

Wake me up when gasoline hits $5.00 a gallon.

Wed, 09/12/2012 - 16:37 | 2787350 dick cheneys ghost
dick cheneys ghost's picture

It will soon, dont get to comfy

Wed, 09/12/2012 - 16:43 | 2787371 Id fight Gandhi
Id fight Gandhi's picture

So this weekend...

Wed, 09/12/2012 - 16:48 | 2787394 Squid Vicious
Squid Vicious's picture

$4.999 at the Mobil on W. 96th St. NYC....wake up!!

Thu, 09/13/2012 - 04:50 | 2788525 Sudden Debt
Sudden Debt's picture

And in Chinatown they charge you 14$ for a pack of Marlboro red...

New York isn't really the mirror of the rest of America :)

Wed, 09/12/2012 - 16:49 | 2787398 samcontrol
samcontrol's picture

from all the folks commuting to work in trucks ? Or retirees going fishing?

Wed, 09/12/2012 - 18:42 | 2787704 WhiteNight123129
WhiteNight123129's picture

Your wages (except in you are in the financial industry) are going to track that soon, so who cares? The hedge funds stacked-up with bonds will get fuck in short order, through a slow motion decline...

Wed, 09/12/2012 - 22:27 | 2788096 SokPOTUS
SokPOTUS's picture

You may want to front-eun QE3 a bit by running out tonight to fill 'er up...

Wed, 09/12/2012 - 16:37 | 2787347 Meesohaawnee
Meesohaawnee's picture

i dont recall hilsenfuck addressing what crude will do.. never mind. matters to none

Wed, 09/12/2012 - 16:51 | 2787408 Cdad
Cdad's picture

The price of oil and gasoline is the leading indicator that no program will be announced tomorrow.  Of course, gasoline was selling off hard all day, so provided the HFT goes to work again on it tomorrow, the price of gasoline could be low enough by noon to go ahead with the money printing fiasco.

That we are talking about any of this simply reveals just how tall of a Banana Republic Tree we have climbed up in the last four years.

The Bernanke SHOULD BE dragged out of the Eccles building tomorrow morning prior to any such disasterous announcement.

More banker pink slips please.

Wed, 09/12/2012 - 17:04 | 2787454 LMAOLORI
LMAOLORI's picture

 

 

The Chair Satan does not care I repeat does not care what you pay for gas or food either for that matter

The Price Of Oil Is The New Economic Spoiler

snip

"What’s today’s lesson. Crude oil in the US is back up to $96 a barrel in the light of an extraordinary rise in the volume of trading in energy futures. The speculators are betting big time on QE3 damaging the dollar, driving up the price of oil– and putting us back in another recession in 2013. So far in 2012 futures trading is running at the shocking level of 25.2 times world demand for energy. This compares to 14.7 times in 2008 when crude oil hit $147 a barrel, and George Soros went short. Sharma is showing us what his hedge fund clients are doing and it is not beneficial for anyone below the wealthiest segment of the nation."

Wed, 09/12/2012 - 17:17 | 2787478 Cdad
Cdad's picture

I understand both what you are saying, and what is going on per oil futures and hedge funds.  However, the cure for high prices is high prices.  Additionally, the FED does have political concerns...despite its age-old claim of "independence."

Shit is breaking...has been for four years.  Just look at the destruction of demand for gasoline as a prime example.  While I agree with you that The Bernanke cares not what I pay at the pump, there is a limit to all of this, and should The Bernanke announce more dollar debauchery tomorrow, I believe you will see the limit to which I refer.

The best answer, of course, is for this nation to rid itself of the FED and all of its stooge preferred broker dealer banks...which is why what we need is....

....more banker pink slips, please.

Wed, 09/12/2012 - 17:31 | 2787507 Rainman
Rainman's picture

China's June oil consumption at levels of 2 years ago. Oil playerz are all-in with hopium for a Chinese mega stimulus

http://in.reuters.com/article/2012/07/13/us-china-oil-demand-idINBRE86C0EQ20120713

Wed, 09/12/2012 - 17:34 | 2787532 LMAOLORI
LMAOLORI's picture

 

 

We agree the Fed has political concerns and ben knows it which is why he better do it soon because he is getting kicked to the curb if romney is elected. Schumer begged the Fed for more QE to save obama and obama begged Europe to save Greece until after his election.   So let's see who does the chair satan go with obama & the banks/wall st. make more money which helps get obama re-elected or the people?

 

Notice how liberal's view this

 

Fed Watch: Did the Republicans Force Bernanke's Hand?

http://economistsview.typepad.com/economistsview/2012/09/fed-watch-did-the-republicans-force-bernankes-hand.html

 

Wed, 09/12/2012 - 17:56 | 2787609 RSloane
RSloane's picture

Yep. Its self-preservation. Bennie wants his job although he doesn't give a shit if anyone else still has theirs. Bennie will go with Obama/Wall Street/Banks. After all, Bennie has a politically appointed job. The people mean nothing to him one way or another.

Wed, 09/12/2012 - 18:30 | 2787676 Yen Cross
Yen Cross's picture

Absolute perfection, you are  Cdad...                " Banana Republic Tree"   the shitty tasting "plantains" ...

Wed, 09/12/2012 - 16:47 | 2787352 LawsofPhysics
LawsofPhysics's picture

...and therefore the contrarian play would be...

No way the Fed would actually destroy their precious dollar...

<sarc off>

Totally fucking stupid.

Wed, 09/12/2012 - 16:56 | 2787424 Bay of Pigs
Bay of Pigs's picture

King Doelarr! All Hail the Bernank!

Wed, 09/12/2012 - 16:39 | 2787357 LongBalls
LongBalls's picture

I didn't need Hilsenrath to tell me. I watched these crooks pound silver this a.m. I knew right then some form of accomodation was coming. If it were not they would have let the price rise and crushed everyone tomorrow. Silver is the tell.

Wed, 09/12/2012 - 16:56 | 2787419 Dr. Engali
Dr. Engali's picture

I hope you took the opportunity to buy some.

Wed, 09/12/2012 - 17:37 | 2787551 youngman
youngman's picture

I bought some....quite a bit....as things are getting tighter...and the way out is getting much much smaller...panic is setting in...and no one was planning on the Arab Spring...Apple shit...that phone will do nothing....everyone is going to caccoon right now...things are getting very itchy....and no one wants to scratch...

Wed, 09/12/2012 - 21:05 | 2787975 lakecity55
lakecity55's picture

but, but, since FB failed to save californicatia, i thought they were relying on the new phone to save them.

Wed, 09/12/2012 - 17:39 | 2787561 LongBalls
LongBalls's picture

Indeed. We are on the next leg up. I sold all my silver at $48 last go. I just doubled down. This time there is no exiting my position untill the new monetary system shows it's face. Which will be right after the war. This next leg is what we have been waiting for.

Wed, 09/12/2012 - 17:33 | 2787536 DosZap
DosZap's picture

Silver is the tell.

Yep, and Gold, it took it Frank style as well.

Wed, 09/12/2012 - 17:57 | 2787613 RSloane
RSloane's picture

Couldn't agree with you more.

Wed, 09/12/2012 - 16:39 | 2787358 LongSoupLine
LongSoupLine's picture

Fuck that MSM puke Hilsenrath.  Fucking Fed cocksucker.

Wed, 09/12/2012 - 16:48 | 2787392 Randall Cabot
Randall Cabot's picture

Fuck Woodrow Wilson too

Wed, 09/12/2012 - 20:47 | 2787937 tenpanhandle
tenpanhandle's picture

now there's some information I can trade on.

Wed, 09/12/2012 - 16:40 | 2787361 the not so migh...
the not so mighty maximiza's picture

THIS GUY IS FUCKEN REDICULIOUS OR HOW EVER ITS SPELT

 

Wed, 09/12/2012 - 16:42 | 2787368 khakuda
khakuda's picture

I'm already up to $4.25 for regular.  Guess I should top off yet again tonight.

Hilsenrath should have just wrote that the Fed is going to continue to try and generate maximum monetary policy uncertainty to continue to ensure slow, uneven growth and commodity inflation in excess of wage growth.

Wed, 09/12/2012 - 16:42 | 2787369 Atlantis Consigliore
Atlantis Consigliore's picture

Heres Berflunky: http://youtu.be/Dsw9jYU_rJI

Wed, 09/12/2012 - 16:43 | 2787374 CPL
CPL's picture

Why not just pay itself to borrow money...oh wait, it is.

Wed, 09/12/2012 - 16:44 | 2787378 BigMike
BigMike's picture

This is the lifestyle that I choose, we smoke tweed, get keyed all day and drink brews...spray myself with sucker repellent and shake haters...

Wed, 09/12/2012 - 16:47 | 2787390 Sofa King
Sofa King's picture

This Fed actions mean nothing for improving the economy or financial condition of average amaericans.  All a pile of bullshit to increase faux bank earnings.

 

All I know is that I picked up a bag of Doritos at 7-11 yesterday and the same bag that was 50 cents a 6 years ago, 99 cents two years ago, then 1.09 one year ago (same bag, less volume), now costs $1.59 and the kicker is that it says "Bigger Size" on it.  Cock Suckers went back to the same volume as when it was 50 cents.

 

But there is no inflation...if the devil speaks with a forked tonge then Corporate America is indeed the devil.

Wed, 09/12/2012 - 16:51 | 2787404 LawsofPhysics
LawsofPhysics's picture

Well the peaches on my trees are bigger, but that's because I finally found someone who knows how to trim them correctly.  Sun and water still free...  for now.

Wed, 09/12/2012 - 17:59 | 2787618 RSloane
RSloane's picture

Be careful, there are some places that will give you a hefty fine for collecting rain water in a barrel.

Wed, 09/12/2012 - 16:55 | 2787422 Bam_Man
Bam_Man's picture

Well, that's a good reason to stop eating that processed crap. The fact that it's practically poison is another. 

Wed, 09/12/2012 - 17:34 | 2787538 SemperFord
SemperFord's picture

Yeah but breathing the air in let's say Los Angeles is not healthy either and Doritos go really good with tuna or any other sandwhiches!

 

Wed, 09/12/2012 - 16:55 | 2787423 Meesohaawnee
Meesohaawnee's picture

tell me you didnt just figure that out.

Wed, 09/12/2012 - 16:58 | 2787430 khakuda
khakuda's picture

And even with those price increases, Frito Lay isn't on easy street because their costs have risen like crazy as well.

Wed, 09/12/2012 - 17:04 | 2787453 LawsofPhysics
LawsofPhysics's picture

yes, because unlike paper-pusher, they actually make real stuff (as crappy as it is it might last just as long as a bar of gold).  A little "frito lay" hedging anyone?

Wed, 09/12/2012 - 17:19 | 2787489 Conman
Conman's picture

But but the Iphone5 costs the same as the 4s did. No inflation you see. nevermind service costs more dont look at that.

Wed, 09/12/2012 - 17:23 | 2787505 Currency is Debt
Currency is Debt's picture

Agree 100%.

 

Also Crude Oil was trading at $10 in 1999 and is now $96 - 960% inflation in crude, huge increases in gasoline and electricity.

Corn, wheat and other essential commodites are up 100s of percents in price etc.

Stuff that is consumed daily. Wages and small business have been in decline

Wed, 09/12/2012 - 17:36 | 2787549 devo
devo's picture

Was there 1 chip in the bag and 99% air?

Wed, 09/12/2012 - 17:51 | 2787590 RSloane
RSloane's picture

Yes, it was billed as their new Diet Dorito. Apparently you can have just one.

Wed, 09/12/2012 - 19:06 | 2787739 Ricky Bobby
Ricky Bobby's picture

We need to start the Dorito Index!

Wed, 09/12/2012 - 19:06 | 2787740 Ricky Bobby
Ricky Bobby's picture

We need to start the Dorito Index!

Wed, 09/12/2012 - 16:52 | 2787412 you enjoy myself
you enjoy myself's picture

are they deliberately trying to get gas over $5 a gallon?  and maybe see another 50% in food inflation?  all while the S&P is at an insane 1436?  i've been conditioned the hard way to never short anything anymore, but i wouldn't want to be long tomorrow. 

Wed, 09/12/2012 - 20:17 | 2787879 Quantum Nucleonics
Quantum Nucleonics's picture

It's an interesting paradox.  QE3 will be viewed as a pro-Obama act, but if gas prices spike to $5 in October, Obama is screwed.

Thu, 09/13/2012 - 03:18 | 2788488 andrewp111
andrewp111's picture

Gas may go above $5 anyway if Netanyahu wants to screw Obama by launching on Iran before the election. And Obama can always release SPR. So, I don't think gas prices enter their calculations.

Wed, 09/12/2012 - 16:52 | 2787413 Kastorsky
Kastorsky's picture

pavlov's dogs are laughing their tails off

Wed, 09/12/2012 - 16:54 | 2787417 TrustWho
TrustWho's picture

IF Bernanke prints QE3, how will he ever be able to say "NO" to the market and politicians?

These eggheads do not understand the fear they create in business owners' minds with their printing. This uncertainty is the largest negative, oh shit fisical cliff, USA debt limit deadline, Obama, Obama, ok, maybe this uncertainty is a significant, along with other non-private political concerns, causing investment to drop through the floor in good ole USA.

Wed, 09/12/2012 - 16:58 | 2787433 Bam_Man
Bam_Man's picture

When has he ever said "No" (to the Banks, Government & Wall St) in the 7 years he has been Fed Chairman?

Wed, 09/12/2012 - 17:04 | 2787455 TrustWho
TrustWho's picture

Why Ron Paul is SO right! The Fed is reverse Robin Hood....oh, better yet, Bernanke acts like a King that does not give a shit about the little people; besides too many people. Hell, If I keep going maybe Bernanke is Hitler II.

Wed, 09/12/2012 - 17:18 | 2787488 Winston Churchill
Winston Churchill's picture

Had a party over the weekend.Suppliers and clients and friends.

Ranged from well to do to very very rich billionaires.One American,everyone else

either dual nationals, or green card resident business owners.

Every single one is already in the process of selling up/closing down their US

operations in anticipation of Obummer/Obummercare/fiscal cliff.

None of us knew that prior to the party and had beeng independantly preparing to

bail.

Talking maybe 5000 jobs among that group of business owners   in my circle..

Wed, 09/12/2012 - 18:03 | 2787624 RSloane
RSloane's picture

That does not surprise me at all. Foreign capital and investments flow to the line of least resistence. That line is nowhere near the US. Its terribly sad and terribly predictable.

Wed, 09/12/2012 - 21:01 | 2787959 lakecity55
lakecity55's picture

Maybe a million letters are soon to go out laying off civilian military workers.

Say what you will about the MIC, but in my state it's over 15,000 people, all at once.

Contractors are required by law to send out the letters; they will arrive right before the election. The Muslim-in-chief tried to have the letters cancelled, but his 'orders' are being ignored.

I primarily fault congress, but there has never been anything resembling leadership from Choom Boy.

Besides, having a non-functioning military will indeed make things "more flexible" after the election.

Wed, 09/12/2012 - 16:54 | 2787421 Squid Vicious
Squid Vicious's picture

that smug little prick goosed the market AGAIN? i hope I see him in a NY bar or restaurant some night...

Wed, 09/12/2012 - 16:57 | 2787427 max2205
max2205's picture

Remember the Hilsenburg!!!!

This routine makes a farce out of our system.

At least Burns and Vollker pretended to be professional

Wed, 09/12/2012 - 17:02 | 2787447 LawsofPhysics
LawsofPhysics's picture

They had the flexibility of actually being able to raise rates.  Ben is trapped, go ahead douchebag, raise interest rates, I double dog dare you, you stupid fuck.

Wed, 09/12/2012 - 18:16 | 2787648 RSloane
RSloane's picture

I would give you a +1 but my clicky is not working at this time.

Wed, 09/12/2012 - 17:19 | 2787494 Piranhanoia
Piranhanoia's picture

Oh the hu...... Oh the Vogonity

Wed, 09/12/2012 - 17:06 | 2787458 urbanelf
urbanelf's picture

Why don't they just flatten the entire yield curve to t(x) = 0% ?

Wed, 09/12/2012 - 17:08 | 2787464 john_connor
john_connor's picture

ES just gapped down about 9 points?

Wed, 09/12/2012 - 17:14 | 2787472 Meesohaawnee
Meesohaawnee's picture

in a way i hope he prints. 5.00 gas will make obama a lock to be gone. in a way printing will be his undoing since that alone will eliminate jobs not create them. Go ahead obummer Let ben release the QE Krakon and then i can count the hours left until romney wins.

Wed, 09/12/2012 - 17:19 | 2787491 wagthetails
wagthetails's picture

and also be forced to appove the pipeline under a Jobs and Energy act.  two birds.....

Obama can save face saying he was forced into the decision. 

Wed, 09/12/2012 - 17:44 | 2787573 TonyCoitus
TonyCoitus's picture

Uh oh, you guys are in for an earful.

Prepare yourself for the Obama and Romney are one in the same spiel!

Wed, 09/12/2012 - 18:44 | 2787706 dwdollar
dwdollar's picture

Let's just skip to the part where anyone who believes there's a difference is a fucking idiot who's been comatose for the past +40 years.

Wed, 09/12/2012 - 18:08 | 2787632 RSloane
RSloane's picture

Unfortunately, there are so many people dependent on the US gov't right now, both individuals and corporations on welfare, that Obama will win no matter what. The dependency level in the US right now is astronomical, the sentiment is everyone owes them something because they suck air. There was a 400% uptick in the number of people on disability; there are a number of Americans drawing both disability and welfare. This is the new vibrant, green-shoots-out-the-ass economy.

Wed, 09/12/2012 - 17:16 | 2787482 Odin
Odin's picture

...I've packed a parachute in my raft, feels like there's a waterfall right ahead...

Wed, 09/12/2012 - 17:16 | 2787484 philosophers bone
philosophers bone's picture

The QE tap is dripping and it will eventually be a waterfall.  Remember that federal income taxes are also a "temporary measure".

Wed, 09/12/2012 - 17:26 | 2787512 SmoothCoolSmoke
SmoothCoolSmoke's picture

I don't get it.  If the goal is to re-elect Obama, what makes that harder, 1200 SP or $5 gas?  I'd say $5 gas.  Now, under 8% UE before election day would really help Obama.  So, here's my take:

1.  QE to try to drive UE to 7.9

2. QE drives SP to 1500+

3.  Obama releases SPR to keep gas under $5.

UE down. SP up. Gas under $5....Obama wins in a walk.

 

Wed, 09/12/2012 - 17:28 | 2787522 Meesohaawnee
Meesohaawnee's picture

SPR has never had a real impact on prices. what a POS if he did a spr when the real reasons are from his buddy

Wed, 09/12/2012 - 17:30 | 2787524 Ned Zeppelin
Ned Zeppelin's picture

Sounds about right, scary, huh? Except for 1, QE does nothing for employment at all. It doesn't even juice the real economy, only the 1% economy, but hey, at least it's Christmas for somebody when Santa Ben shows up.

Wed, 09/12/2012 - 17:52 | 2787591 LMAOLORI
LMAOLORI's picture

 

 

Neither.  First of all a lot of obama supporters don't work  and will vote for him because of the welfare programs yea I know that'll draw the down arrows :) second of all a lot of obama supporters want higher gas prices gloBULL warming, next gas prices won't immediately go up due to supply and then winter switch over and the remaining obama supporters think nothing that happens is his fault claiming he's blocked at every turn. 

As for S&P

S&P 500 Above 1,200 Means Obama Wins: Economist

Wed, 09/12/2012 - 18:13 | 2787642 RSloane
RSloane's picture

I posted on that above. There was a 400% increase in the number of people on disability in the US.  Half of Americans are drawing food stamps or other benefits. Less than half pay taxes. Corporate and individual welfare are rampant. More and more babies are being produced that have a parent that has no means to support that, and other, children. Who do you think they're going to vote for, if they vote at all?

Wed, 09/12/2012 - 20:52 | 2787946 lakecity55
lakecity55's picture

I would not be too quick. Many UE folks I have talked to know the score. They want to go to work. They are taking what's offered, but they are not voting for the magic negro. There is more at play than just a "free check."

Wed, 09/12/2012 - 17:26 | 2787515 oldfruit1
oldfruit1's picture

1) so is this a head fake by hilsenrath? or are the FED actually going to go ahead with the options he's laid out?

2) whats the best trade if they start buying MBS.. US real estate sector .. buy REITS? 

 

 

Wed, 09/12/2012 - 17:27 | 2787517 Ned Zeppelin
Ned Zeppelin's picture

Buying mortgage securities serves no purpose.  Rates are super low, but only if you qualify.  It will not help housing one iota, but that is the optic the Fed seeks.  So who does it benefit? For one, they may buy yet another truckload of really crappy RMBSs that are in deep trouble and otherwise useless as collateral to their insolvent owners, and buying them for par gives a huge upside to the insolvent owners. That's all I can figure.

Wed, 09/12/2012 - 17:27 | 2787518 Yen Cross
Yen Cross's picture

 The February low in the DXY comes in just above "78.00" , WTI is flirting with $97bbl, M/E tensions are rising.(inflation)

  The NIRP/ZIRP policy of the Fed. killed the "golden goose" a long time ago. Now the Fed. is trying to turn "goose shit" into "liquid gold" ! Pathetic, you are Hilsenturd!

Wed, 09/12/2012 - 17:29 | 2787523 jplotinus
jplotinus's picture

More and more ordinary people, whose eyes glaze over when economics is the topic, are learning that QE means free $$ to a few banks and either higher public debt or higher prices for food and fuel for all the rest.

QE tomorrow could create a tipping point.

Just say- in...

:-/

Wed, 09/12/2012 - 18:24 | 2787664 Meesohaawnee
Meesohaawnee's picture

i totally agree. I read the message boards of the MSM like bubblevison and yahoo finance. Thats the one thing that strikes me. The financial literacy takes a hit there but reading last night (cause after all bubblevision is pumpin in like you wouldnt believe) your at 90 95 percent anti qe. And the kicker is, people dont outright just  not want it, they are angry about it. Livid. They understand how fucked they will be and they also understand that CNBS is not finance news but just lapdogs for the fed and banking elite. .... That tells you something.

Wed, 09/12/2012 - 18:57 | 2787726 Yen Cross
Yen Cross's picture

 Count me in!  No pun Intended.

Wed, 09/12/2012 - 20:27 | 2787902 lotsoffun
lotsoffun's picture

have to disagree.  i think the people that are muppets but concerned are starting to get to yahoo finance and comment.  they are over-represented, because the rest are still doing all the distractions, burgers/fries/dancing with the kardshaasians whatever.

 

Wed, 09/12/2012 - 17:30 | 2787526 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Bernanke has me bored and I expect nothing, which is likely what Bernanke wants when he "surprises" the market, but I may be alone. 

From the looks of it I guess the WS Muppets are in a perpetual state of thinking QE is right around the corner.

Wed, 09/12/2012 - 17:39 | 2787559 oldfruit1
oldfruit1's picture

million $ question is have the WSJ been tipped off about tomorrow or not .. who knows what goes on between the FED & WSJ .. maybe the FED has cottoned onto the fact that everyone inc ZH is ridiculing this special relationship & therefore may have cut the WSJ out of the loop. 

Wed, 09/12/2012 - 17:32 | 2787534 Meesohaawnee
Meesohaawnee's picture

why do we need qe? we already have Twist extended thru the end of the year and you can still ramp the market on nothing?

Wed, 09/12/2012 - 17:38 | 2787558 Billy Shears
Billy Shears's picture

The Federal Reserve is worse than insane, it's criminal!

Wed, 09/12/2012 - 17:42 | 2787562 Ned Zeppelin
Ned Zeppelin's picture

The best you can hope for if you are a fan of QE is Hilsenrath's Door #2:  "The Fed could continue the Twist program and launch a mortgage-bond-buying program by its side in which it buys mortgage bonds with newly printed money but continues to fund long-term Treasury purchases with sales of short-term securities."   Half sterilized, half not. It's the "half not" part that gets the party going.

It could couple that with an open ended statement: " We know we've previously talked about QEs that "begin" and "end", but it's high time we got rid of this pesky "end" part. Thank you." 

This is kind of a "more of the same with a side dish" approach.  And I still say they should just do nothing. 

"Mr. Chairman, get to work!

Unending QE will be fatal to a faith-based fiat currency, in time.

Wed, 09/12/2012 - 18:41 | 2787703 RSloane
RSloane's picture

"Faith-based fiat currency" I like that. I would also give you a +1 but my clicky she no work.

Wed, 09/12/2012 - 17:41 | 2787564 ZeroAvatar
ZeroAvatar's picture

Here's a new one:  Now the ammo co's are selling '333's,  boxes of 22lr, 333 count.  $15.00.

 

I guess the sheeps haven't been buying enough of the bricks of 500 (or 525).

 

PB too expensive.

Wed, 09/12/2012 - 20:46 | 2787929 lakecity55
lakecity55's picture

Well-stocked ammo and reloading dealers were selling out at the local gun show last weekend.

I traded a bunch of brass and just got back some .40S&W; my guy does 1 round per 4 pieces of brass.

I'm lucky to have a source for 1X fired LC/Federal brass.

A good deal, when he is buying the ball, powder, and primer.

Unfortunately, it was all stolen from the back of my truck.

Wed, 09/12/2012 - 20:58 | 2787961 Jam Akin
Jam Akin's picture

That is a good deal - condolences on your loss.  Was glad I picked up a couple of 525 packs of .22 this weekend for under $20 until they too were robbed from my trunk.

Wed, 09/12/2012 - 21:17 | 2788002 lakecity55
lakecity55's picture

Yes, I've been trying to get a few weapons and ammo, but I think thieves are following me from the gun store. All my stuff keeps getting stolen. To make things worse, my PMs fell off the back of the truck 'cause I left the darn tailgate down.

I guess it's out to the interstate exit ramp tomorrow again with my sign.

Sorry about your 22's, too. Everyone I know on ZH has been victimized by ammo and PM thieves!

Wed, 09/12/2012 - 17:43 | 2787569 youngman
youngman's picture

I would make the reserves interest rates go negative...see if that got some money moving...

Wed, 09/12/2012 - 17:44 | 2787570 Yen Cross
Yen Cross's picture

 O/T These asshats on CNBS are talking about the Piigs, generating revenue off of what EXPORTS? That 190b€ German commitment to the(ECB) ponzi scheme dwarfs the (net €) gdp of the Piigs! What a farce!

  Those idiots would sell "faceplant" @ 3:00 p.m. NY time to their Grandmother!

Wed, 09/12/2012 - 20:41 | 2787925 lakecity55
lakecity55's picture

Like MSNBC, the financial channels are all Barry Soetoro propaganda organs for the Socialist Democratic Party.

Truth lives here, on ZH.

Wed, 09/12/2012 - 17:50 | 2787585 IMA5U
IMA5U's picture

HYG outperformed equities again

 

giddy up equity bearz      learn to bow down to HYG

Wed, 09/12/2012 - 18:05 | 2787596 ekm
ekm's picture

There is only and only reason the Congress and WH will allow QE 3 or 4 or 5:

Only if the counterparties of CDS bets from Primary Dealers are Chinese and Russian state linked banks.

If Putin is saying he will attack the country of Georgia again and if China is saying that they will attack Taiwan or the Japanese and Philipino islands if CDSs payments not done, then the current US leaders (both Congress and WH) may decide to crap their pants again and provide money to primary dealers.

 

But, but, It will lead to less and less bonds and stocks being available for Trading hence they may end up bailing out NYSE and Nasdaq. That is on top of crude oil going to $120.

 

Other than the reasons explained above, there is no chance, none whatsoever that the Fed will ever, ever, ever do any QE unless crude oil goes down to $60, at least and S&P goes down to at least 1000.

 

Wed, 09/12/2012 - 18:23 | 2787660 ekm
ekm's picture

It is even quite possible that Congress or WH or both (forget Benny) wants a collapse of oil price and S&P as fast as possible and is using Mr Hilsenrath to lure as many suckers as possible.

 

Wed, 09/12/2012 - 18:39 | 2787679 Meesohaawnee
Meesohaawnee's picture

ekm your always a voice of logic and reason here. Thats been my stance. Your last sentence. Along with 6 weeks before the election and many others. i have about as much anti conviction as you but the problem i have is these people are criminals and they have no interest in whats best for the masses. If they did this is a slam dunk NO.. Not in my wildest dreams or nightmares would i ever ponder QE at SP 1430s and crude at 97 but once again, if you want to figure criminals out you have to think like one

Wed, 09/12/2012 - 18:48 | 2787708 ekm
ekm's picture

Sir, thx a lot.

I've come to the conclusion that QEs are beyond Benny's power and have absolutely nothing to do with the economy. It's so obvious they are so harmful to the economy.

QEs are political decisions, not financial decisions, in my opinion.

 

Hence, if QE is done, the decision would be made at the urge of  CIA and Pentagon and State Department, not at the Fed.

 

Wed, 09/12/2012 - 19:09 | 2787747 RSloane
RSloane's picture

+1 to you too, Ekm. QEs are political decisions particularly now. Then people wonder why QE over and over and over with some Twist thrown in does not help Main Street at all. Its almost as totally disconnected from the real economy as Wall Street is from Main Street.

Wed, 09/12/2012 - 17:56 | 2787608 Brazillionaire
Brazillionaire's picture

Many critics worry that the Fed’s money printing will someday cause inflation or another financial bubble. Many officials don’t agree, but they’re sensitive to the argument.

Apparently these guys do not buy gasoline, food (except on their expense account credit card), or anything else that the rest of us have to buy to make it in this so-called economy.

Nice to know that they are "sensitive to the argument." Thanks for throwing us a bone. 

Wed, 09/12/2012 - 18:21 | 2787658 RSloane
RSloane's picture

The bone was that they would be sensitive to anything the average consumer was feeling or thinking.

Wed, 09/12/2012 - 18:20 | 2787654 dwdollar
dwdollar's picture

Bernanke may very well be dumb enough to try something. With markets at or near all-time highs, he may figure it's his big (and maybe last) chance to push through in order to raise those animal spirits. GOD help us...

Wed, 09/12/2012 - 18:25 | 2787665 lolmao500
lolmao500's picture

And when the bond market wakes up and interest rates rise and bond value plummet, the FED is gonna lose hundreds of billions... but of course, the taxpayers are gonna pay for it even if the FED is PRIVATE...

Wed, 09/12/2012 - 18:28 | 2787670 dwdollar
dwdollar's picture

Has there ever been a case of equities making new highs and official unemployment above 8%?

Wed, 09/12/2012 - 18:29 | 2787674 yogibear
yogibear's picture

Hilsenrath is a fed whore. How many times does this guy visit the Federal Reserve to service them? Gusss he always has to have one in his mouth.

Wed, 09/12/2012 - 18:45 | 2787710 RSloane
RSloane's picture

Hilsenrath and Steve Liesman. I'm surprised they haven't moved in with each other............yet.

Wed, 09/12/2012 - 18:38 | 2787695 Yen Cross
Yen Cross's picture

 The MOMO, (personal) Job Saving , 2/20 Bernanke Institute , Welcome to life outside of Qe, warriors/SARC ?

  Let's make a movie, and call it ( Return of The Basement Babies)... Run for your lives BOOMERS!

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