"Hopelessly Devoted" - IceCap Asset Management September 2011 Market Outlook

Tyler Durden's picture

From IceCap Asset Management:

While Ben Bernanke may say his mentor has always been Stanley Fischer, here at IceCap we are able to see through this charade. Mr. Bernanke’s inspiration has always and will always be the 1978 cinema classic – Grease. Whether his inspiration is Olivia Newton-John- Travolta or in fact Mr. Fischer, we know that Helicopter Ben is belting out Grease show tunes while in his office, car or bath tub (if Warren can do it, why not Ben?). And although the Chairman of the US Federal Reserve will always claim he is hopelessly devoted to doing what is best, he is actually doing the only thing he knows how to do – print money. Exactly where he got this drive to be a money printer is undeniable – we’ll blame it squarely on the shoulders of the father of modern economics, John Maynard Keynes. Blasphemous you say? Well, step aside sonny, here’s the real story behind the money printing machines from the USA, Japan, Britain and Europe, and why they will continue with this unsuccessful strategy.

Full report (pdf)

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russki standart's picture

 2011 edit, updated for high taxes, stagnant wages and imminent financial catastrophe: Olivia, a bit older and uglier sings to the Bernank,  ...Hopelessly devoted to you, We are hopelessly f@cked by you¨¨

The Shootist's picture

Indubitably. Fiat needs to go.

Michael's picture

Ex-IMF Chief Rogoff said Greece will massively default.

I love the smell of napalm in the morning.

Michael's picture

The only people buying into this market are the people playing with themselves.

Lets jus call it; A self induced stock market erection.

lolmao500's picture

Sweet! Bye bye Europe!


German turmoil over EU bail-outs as top judge calls for referendum Germany's top judge has issued a blunt warning that no further fiscal powers may be surrendered to Europe without a new constitution and a popular referendum, vastly complicating plans to boost the EU's rescue machinery to €2 trillion (£1.7 trillion).

Sock Puppet's picture

Tuesday, Sep 27, 2011 01:39 AM

. . . . . . . . . . . . . . . . . . . . . . . . . 

 German Economy Minister Philipp Roesler, who’s also the leader of the Free Democratic Party, expects enough votes from the ruling parties to approve expansion of the European Financial Stability Facility without help from opposition lawmakers, Bild Zeitung reported, citing an interview.

Smithovsky's picture

i guess alessio's 15 minutes of fame are officially over

Peter K's picture

Somehow I feel sorry for poor ole Keynes. His name has been highjacked by a bunch of Crypto-Marxists without the balls, (or the electoral pull) to admit that which they in fact are.

TruthInSunshine's picture

John Maynard Keynes on inflation in The Economic Consequences of the Peace (p. 235-6):

By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security, but at confidence in the equity of the existing distribution of wealth. Those to whom the system brings windfalls, beyond their deserts and even beyond their expectations or desires, become ‘profiteers,’ who are the object of the hatred of the bourgeoisie, whom the inflationism has impoverished, not less than of the proletariat. As the inflation proceeds and the real value of the currency fluctuates wildly from month to month, all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless; and the process of wealth-getting degenerates into a gamble and a lottery. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.”


Inflation, bitches! Even Keynes thought it was EVIL.


(Paul Krugman, you do realize that you're betraying your false prophet, JM Keynes, in calling for much higher inflation [as to why you would do such a thing, as it would NOT have any impact on creating higher levels of employment and would further erode living standards by eroding purchasing power, only a fellow insane asylum patient would be able to hazard a guess]).

Peter K's picture

Krugman is a Marxist. Plain and simple.

macholatte's picture

Thanks for the entry by Keynes.  What it is telling me is that "they" know exactly what they are doing, including Krugman. And what they are doing is destroying the country in a premeditated manner. So it makes me wonder what the IceCap folks are thinking when they say things like "...they will continue with this unsuccessful strategy."

To me, the strategy is quite successful. JMHO

caerus's picture

you are correct...they are quite aware of their intellectual perversion...

RockyRacoon's picture

Best part of the article:


  For starters, long-term interest rates are already at their all-timelows. It now costs 1.9% to borrow money for 10 years. If this all-timelow rate isn’t enticing, why should a rate that is a shade lower work?Next, the direct result of pushing down long-term interest rates willhave a horrible impact on US banks revenues – let’s just say therewon’t be much “net” in their “Net Interest Margins” once thishappens.This bizarre decision by the Fed to twist their balance sheet showshow twisted and inconsistent they are with their use of monetarypolicy. To better understand how horrible of a decision this is andhow it is devastating for banks and insurance companies, we mustremember that the # 1 strategy to fix the American bank problem isto have the banks slowly bleed the average person into poverty
falak pema's picture

having demonstrated hereabove the Keysenian view on monetary debauchement called inflation, you then go on to label JMK as "false prophet". Don't blame JMK, blame PK!

There is a confusion on this blog whereby the ongoing philosophical bend of the "trader community" represented here can be best summarised as follows  IMHO : 

"Libertarian Anarchy is the best form of capitalism". Libertarian anarchy, Ayn Randish belief in invisible hand of free markets and entrepreneurial excellence exercised by virtuous minded risk takers, is a utopian dream that the current capitalist reality has demolished once again; as if this demonstration needed to be repeated to prove once again an already proven phenomen after that identical death spiral of 1929.

The true reality of capitalism is Oligarchy play, concentration of political and economic power and its disastrous hegemonic consequences. "The world is run by Goldman Sachs", expression of this Oligarchy, similar in mantra to past totalitarian politico-militarist philosophies that produced Hitler and Stalin. Same hubristic power hungry mind-set, different intruments of power. "How many divisions the VAtican", is equivalent today to "how many trillions of assets" asked by the same Oligarchs to the people of the world, through their surrogate so-called market mecanisms, full of HFT/dark pool crony setup  manipulations, and their specifically designed toxic weaponry of mass destruction type CDS/CDO/SIV and its illegal off-balance sheet financial shenanigans, all tolerated by the political/regulatory PTB. 

This is INTOLERABLE "sham market" destructive capitalistic play. Financial Armageddon like Guderian's panzer play. Its time to pull down this false world casino market facade that impoverishes the masses and feeds the 0.1 % power brokers.

So it is extremely nauseating to here at ZH the ra-ra stupidty of people who pretend that in the sacred temple of market economics "Libertarian anarchy and Oligarchical hegemonic market totalitarian play are the natural bed -fellows" to keep the world safe from greater evil of Keynesian socialistic Marshall plan type schemes to save the democratic world's economo-political construct. 

You guys now defend, like the pathological minded trader on BBC, the Gabriel Princeps mind-set and financial action of this world which started the military Armageddon of 1914 at Sarajevo. Inacceptable corrupt, decadent logic. 

We have a world financial Oligarchy that is the root cause of current evil, by having built a world financial ponzi entirely for their sole benefit. We have to bring down this totalitarian financial construct by any legal and popular supported means. It requires a world wide effort as the problem of casino markets is a world wide cancer. So we need a new FDR as in the previous instance and a new JMK. Same problem and same imperfect solution. That's the best we know in the human world. 


Ranger4564's picture

Thank you, thank you, thank you.  I am in complete agreement.  The world is being destroyed by the very principles being cherished at this site.


Keep up the great work.   

RockyRacoon's picture

Yup.  There is definitely a schizophrenia here at ZH.   I am not a trader... wouldn't get within a mile of it again.   It's very difficult to have depended upon a system that is now eating the traders alive.   Like old whatshisname who got eaten by his own lions at the circus.  

One of the saddest lessons of history is this: If we've been bamboozled long enough, we tend to reject any evidence of the bamboozle. The bamboozle has captured us. Once you give a charlatan power over you, you almost never get it back - Carl Sagan

caerus's picture

for all the young un's hopelessly devoted dig it

DalaiLamaInAShark's picture

Riddle me this..... Hellocopter Ben prints about 2T (give or take - since the crisis started)... the dollar is STRENGTHENING!  WTF! ... and you know what that means for PMs.

RockyRacoon's picture

If you don't have a handle on why the dollar is going up (look at what constitutes the "basket" of currencies that make up the dollar index), and don't see that the relationship (or lack thereof) between dollar strength and the price of gold, then you'd better not wade into this sewer of a market.

I think I need to buy a gun's picture
 4 minutes bitchezFiat Money Explained in under 4 minutes (video)

-- Posted Monday, 26 September 2011 |

Share this articleShare this article| Source: GoldSeek.com

Despite every effort by governments, the gap between rich and poor continues to grow. It is now the biggest it has even been in history. All sorts of reasons for this have been proffered, but few, however, seem to realise that is a simple, inevitable consequence of our system of money and credit. This video, a shorter version of which appears in the film The Four Horsemen, explains ...

Written and narrated by Dominic Frisby
Animated by Pola Gruszka
Produced by Renegade Economist

-- Posted Monday, 26 September 2011 | Digg This Article | Source: GoldSeek.com




chump666's picture

these rallies are legless baby...if they can't hit the 100ma, major sell on again.

yabs's picture

hoiw can anyone with a brain belive the keynesian bullshit?
its akin to flat earthers or voodoo

yabs's picture

to be fair though Keynes just said the governmnet shoulkd save in the boom or good years to allow some slack in the down or bad years

he dodn't say spend spend spend all the F*cking time

so Krugman et al have butchered the teaching of Keynes

Lady Heather...UNCLE's picture

(Newsreader)..."midst the noisome  distraction of NY city-wide protests, violence and indiscriminate looting, the Dow Jones eked out modest 3.5% gains today. The index got a boost early on,  after an early morning explosion in downtown LA. Airline stocks, which immediately soared on the back of the conflagration, eased back a little after it was shown that  Al Queda was not involved. However this was not enough to dent general economic optimism.  The last 30 minutes saw serious gains in the index as Wall St anticipated a post 18th green address from the President. Hopes are high that the 300 trillion debt ceiling increase will pass congressional muster and Capitol Hill will again "pass this Bill".   Back to you Jenny

unirealist's picture

The analysis is accurate enough.

I just wish it had been proofread before publishing.

An "allusion" is NOT an "illusion."  No matter how many times you use it that way.

Temporalist's picture

Some news from places:

Deloitte Touche sued for $7.6bn in mortgage fraud case



New attack on Egypt gas pipeline to Israel and Jordan



BAE Systems to announce nearly 3,000 job cuts



Afghanistan: 'Two killed at Kabul CIA station'



spanish inquisition's picture

The ruler had a bad dream and consulted some seers in his kingdom. The dream was 7 large rubinesque women walking into a river with 7 low fat icecream bars coming out. Not knowing what ice cream was he touched it and it was cold. Cold weather was bad for crops, famine was coming. He called some trusted advisors for ideas on what to do.

So there was this guy in funny leather pants who said "Looken ze here ruler, if people grow wheat and have extra wheat they can sell it. Should a drought come and they live in ze city with no land or money, zat's their own dam fault. If zey didn't buy insurance, let zem die or riot"

The JayEmKay said "You know you could get some tribute or tax of wheat for a few years and when the drought comes give it back to the people. Like a kind of insurance. The People get back what they put into it and the kingdom is saved from excess swings in crop production. Kind of a group insurance plan"

Being pragmatic and wishing to not upset the masses and remain in power the king pondered what to do....I will provide insurance for the people, and he began to build warehouses and fill them up with wheat.

In a few years the finance minister came to the ruler and said "We need more money for warehouses, your afterlife house and your wife wants another temple. Your nephew talked to me about giving him some land out east to start a commune or something". And the ruler said " Where am I going to get more money, out of thin air?" And Bernie the finance minister said "Funny you should mention that, we could sell shares of wheat for future delivery during the drought , we have way more than we need, that will allow us to continue to build your legacy."

"Sounds okay," said the ruler "but what happens if we run short?". "We can buy more wheat on the market with money from selling future contracts on wheat that you haven't collected yet". King "You mean after the drought, I am still going to collect wheat". Finance Minister "There are always going to be droughts, so we can keep collecting and can make money on shipping excess wheat to our neighbors". "If you think it will help my legacy and if it is safe" said the ruler "I am worried about running out of wheat". "Not a problem, we grow wheat every year and I have projections that show complete safety in what we are doing as long as we don't over do it". "Any other ideas?" asked the king. "I am working on a few, how much can you shave off of a kernel of wheat and have the people still say it is a kernal? It is still in the concept phase".