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Hilsenrath Has Spoken: GDP Is Worse Than Expected After All, "Won't Constrain Fed"
Just after the GDP number was released, we joked that the only opinion on the sub-standard Q2 US economic growth that matters is that of Fed uberchairman Jon Hilsenrath:
Only Hilsenrath's take on the GDP matters
— zerohedge (@zerohedge) July 27, 2012
Turns out we were not joking: the Fed mouthpiece has just released his take on the GDP. His bottom line: Inflation Data Won’t Constrain Fed. In other words, the Fed ignores the modest beat to expectations, and has given the green light after all.
From Jon:
GDP Highlights: Inflation Data Won’t Constrain Fed
A few quick thoughts on GDP report out this morning:
- Key price indexes are uniformly running below the Federal Reserve’s 2% objective. The personal consumption expenditures price index was up 1.6% from a year ago, thanks in part to falling gasoline prices. This is the price index that the Fed watches most closely, more so than the consumer price index produced by the Labor Department, which is running a touch higher. Excluding food and energy, the PCE price index was up 1.8% from a year ago. The Fed watches this ex-food-and-energy index to get a read on underlying inflation trends. For the quarter at an annual rate, the PCE price index ran at 0.7% and excluding food and energy it ran at 1.8%. An alternate measure, the “market-based” price index, is also running below 2%. This is ammunition for Fed officials who want to act right away to spur growth. Not only is growth subpar, and the job market stuck in the mud, inflation is also running below the Fed’s long-run goals.
- National defense spending contracted three quarters in a row. The winding down of two wars, it seems, is having a short-term negative impact on growth, though it is certainly in everyone’s interest in the long run that the nation not be at war. Of course budget cuts are also part of this story.
- Business investment ran at an 8.5% annual rate in Q2. Not bad, despite all of the uncertainty business leaders express about the world. That includes 7.2% in the all important equipment and software category.
- With very little fanfare, housing investment has been growing for a full year and went at a double digit pace in the first half of 2012.
- Final sales of domestic product — a measure of how the economy is doing when you take out inventory swings – up at a 1.2% rate in Q2 and averaging a 1.7% rate since 2011. That’s really substandard for a recovery.
And there you have it: the central planners' parrot has squawked.
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Shocking, very shocking indeed.
"Inflation Data Won’t Constrain Fed"........need they say more?
Gold, bitchez!
"Pay no attention to that bearded man behind the curtain !"
"Auntie Em - there's no place like home!"
Of course the plan is to print more money / issue more debt.
It always was, is, and will be the plan.
Act accordingly.
THIS "Bernank Put," just like the preceding "Bernanke Put" of 2007, and the "Greenspan Put" of 1999, will save the market.
Just buy the New Winners of the Nasdaq New World (heavily weighted with leverage in recently IPO'd tickers), and have faith in The Bernank.
Can't any of you see how..... it's different this time?
How ironic that the 'conservative' Wall Street Journal, under the reporting of its Chief Comrade, Jon Hilsenrath, has become the proxy mouthpiece and agenda pusher/opinion shaper (attempting to be, at any rate) for the very radical, interventionist and central planning committee that is the Non-Federal Reserve-less Non-Bank, no?
Silver to da moon bitchez!
This will be great for the election!
Just think where the food and energy inflation will be in 90 day's after a new round of monetization..
House prices will be well on their way to zero, and every realtor will have a cross hair on their back, along with every banker.
SO BY ALL MEANS, monetize till your hearts content.
Im off to fill the gas tank, hit the meat aisle, and buy another 10 boxes of shells, then to the pawn shop fer some new shiny's.
after reading Bailout by Barofsky, no government official involved in economic policy has the least bit of credibility.
Short US Treasury Bond contract on the CME from 154-00. Making money every day. You too can short the long Bond. Long Dec. Silver from 27.0875; it's buyable right now at todays price. you too can be paid back the penalties of inflation so that your savings remain intact.
Buckle up.
Indeed!
The more they print the more profit I make.
Worst recovery since WWII. And the Fed can't undo the massive regulations tying business' hand.
http://confoundedinterest.wordpress.com/2012/07/27/a-regulated-decelerat...
Print Ben ...print.... send gold to 10,000 and kito will owe me a turkey sandwich.
Probably by then you need an ounce of gold to buy one :-(
Best regards to the printing banksters - Fuck you all, believe me (if I may cite one of them)
oh doc, to dream, to dream :) ................................................
HilsenRAT u mother fucker!!! You stopped me out of a short again!
I hope you are not seriously shorting this market. If that's not sarcasm then I'll give you my contact information and you can just make your checks out to me. There is no way I would short this pig right now,even though I believe it should be. Ben is going to make sure the shorts get burned.
I do indeed short it, and buy it (ES), every day. Position trades are in equities: long UNG and SHORT...yes short, LVLT - both for weeks now. So thanks, but I'll keep my $$.
Well good luck. I hope it works out for you. The only time I short any more is when QE winds down. Then I'm out until the next round. I do think this will be the round it blows up though. Ben is boxed in.
He may be boxed in - i dunno, but it will be VERY interesting if QE3 results in a drop b/c equities are ALREADY high & iRates are already ZERO. I can't wait.
Good luck to you too!
"Buy the rumors and sell the (QE) news"?!
Friday ramp up. Rinse and repeat.
Friday ramp, Monday ramp...etc etc.
We have seen this before, remember him: Muhammad Saeed al-Sahhaf (http://en.wikipedia.org/wiki/Muhammad_Saeed_al-Sahhaf).
I think the Fed (or their agents) already have the greenlight to buy AMZN
NO ONE (not even ZH) has mentioned the amount of money printing that will be announced. What does the market expect? $1 trillion? $500 Billion? What if ben does a nominal amount of $20B per month??? Market will NOT like.
Last one was $600B. I think that is your floor for QE3. I think if they go over $1T, even supporters will get a little weak kneed knowing that we've reached the point of no return.
So, will it be Treasuries, or maybe MBS'? I don't think they've quite reached the point of securties purchases (at least openly).
Well thats their REAL problem, since DOW 9,800 markets have priced in how much QE promise? $2 trillion at least? More like $3 trillion in reality?
Infinity implied.
Crash and burn next week if they don't deliver hahaha.
Your Fed Chief has spoken!
Is he reporting the news or creating the news i forget what "reporters" are supposed to do?
I still think no QE. This may be a push to talk the market up for month end. And since when are we winding down two wars? We've been at war with Oceania and we will remain at war with Oceania.
What cowards the FED must be if they don't have the balls to speak the plain truth and instead jawbone via turd parties. Dear FED, quit screwing around! There are millions unemployed and on food stamps. Prices are not stable! Stick to what you were commanded to do.
As a privately owned banker's bank (one may even go so far as to call it a banker's club, as banks must become members), the Fed is ONLY concerned with protecting the banks. Never forget that.
They are really going to QE with oil at $90 and the down at 13K???
The central planners refuse to stop intervening.
Its 100% bullshit, QE3-NEW is just a joke.
The Next round will be the buying of bundled together, underwater, bank owned homes. Must clean up bank balance sheets
The central planners boxed themselves into a corner and believe they have no choice but to intervene.
As an aside, I remember when the US Government passed the Chrysler Loan Guarantee Act in 1980 to provide $1.5 Billion in loans to bail out Chrysler. I thought that was shocking that the government would intervene to that extent. Now, bailouts are the norm. It would be shocking if a government refused a bailout to a sinking company (e.g. Lehman Bros.).
1000% FUBAR.
It looks like an algo or competing algos have completely taken over oil futures. The chart looks like the IBM chart from last week. Someone entered $90 as the price oil must stay at. Another algo wants it lower.
And to think, weren't the original expectations for Q2 somewhere north of 2.3%?
That's ok Q3 or Q4 will save us, right?
Can you say Flashy Crashy?
Oh, when? Last time it happend in a blink - could not watch.
For the 99% I guess it's also substandard what this QE shit produced by now...
Bernanke, you're up!
Now show us your Krugman credentials and print (even more) with reckless abandon, lest you be accused of being a spineless pussy!
The pressure on the Fed right now: EPIC.
I think I see Kermit on a skewer.
Hilsenrath, Bernanke, and Draghi are saving their "Pie-Hole" ammo for later.
When momentum has clearly established to the upside and millions of bears try to short to catch the next leg down..
That is when these guys will unleash a definitive statement that clears the S & P 500 to new 3-year highs
SPAM
Plagiarism?
Why haven't you killed yourself yet?
Coordinated central bank mouthpiece intervention
no hes not. cause then idiot romney can so easily claim the fed is influencing the election. simple. NO WAY! theres not a human being alive that is buying into the nasfraud. even obummer knows you do qe 3 and oil will wake the sheeple up. shut up hilsenfleece.
Jon Hilsenrath aka WSJ's Maria (money honey) Bartoroma is a tool. Who would have guessed such a young kid would wield so much power? But that's what our markets have become. Where are the adults? Where are the regulators? Why does the SEC allow this kind of manipulation? Where do I sign up to change this?
Hebrew telling another Hebrew what and how to do it... they are the choosen one after all
Zimbabwe or bust! Or bust, or bust.
The fed is so worried about being independent of congress how about independent from GS, JPM, MS
so tired of the wink wink, buy more stocks guys I've got your back.
hilsenfleece = stealth short ban
Where do I get in line to get the firehose of money pointed my way?
Its all relative...you get more little green pieces of paper but it takes more of them to buy a loaf of bread.
Somehow this makes sense to them, the quality of the bread hasn't changed, just the quality of your money. Then of course your wage mostly stays stagnate but thats of secondary importance to them now.
And of course your taxes always go down, never up ;-)
bought a package of cipps ahoy choc. chip cookies last week and the cookies are physically smaller and the chips are 1/3 the size they were a couple years ago. there is the inflation and stealth qaulity loss. sure you already were aware......
Those cookies taste like crap. It is worth your while to make your own. Honest. I'd bake for everyone here if I could.
Let's sell our souls and make a deal with the devil to never allow the US to go into a recession again.
You don't need to. Ben did that for you.
God's work you know.
how come nobody ends up holding the bag in this?
unless the algos are really zero sum based, and they don't hold anything for longer than seconds
Seconds? Seconds can be an eternity when they are trading at the speeds they are capable of now.
You mean besides the taxpayers? I'm holding my bag. Hilsenrath is holding your bag.
I'm holding the bag. If you short stocks based on reality and then bullshit market manipulation does a magical market levitation you get fucked.
If I were a banker on my private jet headed to the Olympics, I would want a strong dollar (exchange rate) going into the weekend.
If I were a banker, I would stay away from planes, helicopters, hot tubs, and I would not allow myself to be driven to out of the way destinations...
Roger that; and you can do some baking for me anytime.
white house reaction to GDP..obama."yea ben,, this is your boss. put the algos in overdrive. Tell one of your cronnies to mention qe3 ..we cant get the sheeple to wake up and realize how screwed they are. this cant happen now. " over.
He's guaranteeing a crash.
If the Fed doesn't do something next week the market will tank. If the Fed DOES something, given that stocks have been going up this week purely on jawboning and the threat of some form of QE, the market will tank.
I said in an earlier comment today that I don't swear very often, but these people are fucking idiots.
DavidC
A nice thought: Idiots on purpose.
The Fed, politically correct economists, the elite are actually relegious zealots. They have a false assumption that man is God and man can control desired outcomes.
HOWEVER, western civilization has been making decisions over many decades that can not be reversed by negative interest rates.
Wait a minute, the Fed is working under the Double Negative Theory, brillant. Negative times Negative = Positive. This is the new reality....double negative
AArrroooo!!!
"HOWEVER, western civilization ha been making decisions over many decades that can not be reversed by negative interest rates."--Yup. Reality is a Bitch, isn't it?
Wait...wut?...one percent is bad?
Does this mean you will value my core assets higher and yours lower? ;-)
In the tone of Monte Python and the Search for the Holy Grail - "Print out your debt! Print out your debt!"
Bring it Fed. Corn, Soybeans, Wheat, Oil and Gold all eagerly await your decision.
david c you always have some great words of wisdom. well done!
Gold's price action doesn't seem to confirm any of hitlersaths staements...
Patience, Grasshopper.
And another comment from me.
Why are they so determined to keep pumping the system when the stock markets are back near post crisis highs? No matter what they do, they will NOT mitigate the problem of an over indebted consumer, determined to bring down their own debt levels. Stupid, stupid, stupid.
DavidC
It's getting close to Bonus season David. Where do you expect the banks to come up with that money?
fonzannoon,
Thanks, that made me smile!
DavidC
Easy answer; to make money - then, when the suckers chase, they short and pole ax the suckers and make more.
Lather rinse repeat with these criminals David.
The could give a shit about the consumer; to them, they are serfs.
let's see how eager they will be to stay this long over the weekend
pluck the feathers off the parrot and roast him! same old squawk different day
actually its not stupid. if you can get away with the perfect crime by calling it "stimulus" when its now why not? Hilsenfleece was ordered to yap that way all his cronnies can get an orderly exit from crapple.they will levitate the nasfraud until all have hit the exits.
Hilsenrath is a kid. A fricking kid. At least give me Art Cashin if your going to rumor monger the market higher.
Any chance to follow EVAs actions instead?
Squawk is cheap. I call BS today on yesterday's idiotic move. DXD for me until the dow is below 12,000.
yea but Art had the deer in the headlights look yesterday. he knows this is a fraud. you tell in his face. His masters have put a reality gag order on Art.
What was that again, $2.33 in debt for every $1.00 of GDP?
http://www.zerohedge.com/news/q2-america-added-233-debt-every-100-gdp
The FED credit card has no limit because taxpayers and their children can always have their assets confiscated, be sent off to war, or turned into Soylent Green for the sake of the Kleptoligarchy.
The European situation is so out of whack that desperation is in the air. It looks like the banks are opting for an equity breakout now, worry about the consequences later. If I were manipulating markets, I would have let some steam out first but truth be told, there's not a lot of steam left in some global markets.
When the wave does crest, it's not going to be pretty.
"When the wave does crest, it's not going to be pretty." It never is, my friend, it never is.
markets are rising with printed out of thin air money, whilst the HFT's are programmed to hunt for all stops, and stop limits! the HFT's are stealing real money out of the markets, while everyone is fixated on charts, graphs, trendlines! HFT's are linked to all data bases, all investing accounts! they know what is where and where is what!!!!
I have my doubts...
I don't believe in QE with these share- and oilprices.
Is it fair to believe that (by withholding the hopium next week) they want the indexes to collapse sufficiently to get to the Bernanke put by disappointing next week?
And... if QE is getting priced into stocks, why aren't gold and silver moving along?
So many things are unclear to me.
Even when cattle stampede parts of the herd start before other parts. If my Silver Contract doesn't go off at a 100% profit before Christmas, then maybe I'll get a zero% stop loss; the order is already in the market. What am I supposed to worry about?
Bullshit rules the day. Professor Harrold Hill would have afield day in this climate.
It seems obvious to me that them thar Fed boys ain't up on their Jethro Mathematics.
Naught Plus Naught = Naught...
No Naught Plus No Naught = No Naught
No Naught Gizinta Naught = Everyon is fucked except government employees cuz we all now they will get their checks while I am standing in the bread line.