Bernanke Testimony Before Joint Economic Committee Live Webcast: More Operation Twist Hints

Tyler Durden's picture




 

Headlines from the Bernanke speech:

  • BERNANKE SAYS FED READY TO ACT, REFRAINS FROM DETAILING STEPS
  • BERNANKE: `FISCAL CLIFF' IN 2013 POSES A `SIGNIFICANT THREAT'
  • BERNANKE SAYS U.S. BUDGET TREND `IS CLEARLY UNSUSTAINABLE'
  • BERNANKE: EUROPE CRISIS IMPAIRING EXPORTS, CONSUMER CONFIDENCE
  • BERNANKE SAYS EUROPE CRISIS POSES `SIGNIFICANT RISKS' TO U.S.

But the kicker, as we explained a few days ago, is the Chairman's hint that more QE would come in the form of additional Twist, not LSAP:

In addition, the Federal Reserve has been conducting a program, announced last September, to lengthen the average maturity of its securities holdings by purchasing $400 billion of longer-term Treasury securities and selling an equal amount of shorter-term Treasury securities. The Committee also continues to reinvest principal received from its holdings of agency debt and agency mortgage-backed securities (MBS) in agency MBS and to roll over its maturing Treasury holdings at auction. These policies have supported the economic recovery by putting downward pressure on longer-term interest rates, including mortgage rates, and by making broader financial conditions more accommodative. The Committee reviews the size and composition of its securities holdings regularly and is prepared to adjust those holdings as appropriate to promote a stronger economic recovery in a context of price stability.

Full testimony here

Finally, judging by the testimony word cloud, this is nothing but a scapegoating session: with Fiscal the most used word, it is clear what is going on: "It is all Congress' fault"

At the rate the market has soared in the past 3 days, one would think Bernanke has already formally announced QE. Instead we have had a rumor, a hint, and a headline. All of this was sufficient to push the DJIA up 500 points. Problem is there has been nothing official from the Fed. Which is why everyone will be looking for the Chairman to leak something at the 10am hearing before the Joint Economic Committee. Otherwise, if nothing comes now, and nothing comes on June 20, we may be looking at another deja vu event from 2011: namely the August 2011 market crash.

From C-Span

Federal Reserve Chairman Ben Bernanke goes before the full Joint Economic Committee for a quarterly hearing to review the economic outlook for the nation.

 

Committee Chairman Senator Bob Casey (D-PA) is expected to press Mr. Bernanke on possible action by the Federal Reserve to stimulate the economy in light of last week’s unemployment numbers and recent global economic uncertainty.

 

In an interview with C-SPAN, Joint Economic Committee member Rep. Mick Mulvaney (R-SC) said the GOP will question Chairman Bernanke on the possibility of monetary easing. He also stated his plan to speak with the Fed Chief about the negative implications of inflation.

 

Bernanke is expected to reiterate his call for Congress and the Administration to work on long-tern legislation to lower the deficit. He told a House panel in February that the economic recovery is "frustratingly slow" which should "prompt Congress to enact policy that will address the crisis."

 

The Joint Economic Committee, established under the Employment Act of 1946, was created by Congress to review economic conditions and analyze the effectiveness of economic policy.

Live webcast below starting at 10 am

Full Bernanke speech:

Bernanke Speech 6.7

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Thu, 06/07/2012 - 10:00 | 2503377 tom a taxpayer
tom a taxpayer's picture

Committee Chairman: Before your opening statement we would like our Congressional barber to shave off your beard.

Bernanke: May I ask "Why"?

Committee Chairman: Transparency, Mr Bernanke. You have stated many times how you want to make the Federal Reserve more transparent. We're here to help you. Your beard can hide facial tics and twitches that are signs of hesitancy and lack of transparency.

Bernanke: Hmmm…well…I…er...

Committee Chairman: Electric shaver or straight razor, Mr. Bernanke?

Thu, 06/07/2012 - 10:02 | 2503387 King_of_simpletons
King_of_simpletons's picture

Bernanke: Everything is fine. Spend Spend Spend. Plenty of jobs, economy is booming.

Congress: Thank you Mr. Chairman.

Thu, 06/07/2012 - 10:14 | 2503459 SHEEPFUKKER
SHEEPFUKKER's picture

Really, a PM raid during Heli Ben's speech? Never seen that before.  /sarc

Thu, 06/07/2012 - 10:25 | 2503548 smlbizman
smlbizman's picture

this guy sounds just like the handicapers at the derby, or the guy telling you which teams will be in the superbowl, or the nba experts....and they all have 1 common feel to them.....and that is they are rarley correct.....

Thu, 06/07/2012 - 10:37 | 2503599 Paul Atreides
Paul Atreides's picture

We're heading for a fiscal cliff AAAhhhhahHH fire up the ROFLCOPTER!!!!

Psst.... hey...ZHers.... gold and silver will rebound to post raid prices before the end of today ;)

Thu, 06/07/2012 - 10:48 | 2503720 redpill
redpill's picture

He's a little mixed up.  We went off the fiscal cliff years ago.  What's coming in 2013 is THE GROUND.

 

Splat.

 

Thu, 06/07/2012 - 10:59 | 2503768 flacon
flacon's picture

Redpill, EXACTLY!

Thu, 06/07/2012 - 11:15 | 2503839 derek_vineyard
derek_vineyard's picture

Bernanke's in a good mood.  He's blaming the politicos and he's correct.  He's mocking them and looks like he's tired of taking all the heat for political folly........and no longer wants to be the dupe and answer the same kick the can questions over and over and over from the politicians that create the problems.

Thu, 06/07/2012 - 11:29 | 2503913 AldousHuxley
AldousHuxley's picture

Bernanke did all he can with QEs and Twists and ZIRP......

Bernanke is tired of taking all of the heat from public while saving asses of Congress status quo.

MONETARY accomodation has been more than accomodative

Time for FISCAL policies to change.....Tax billionare money changers and and give it back to workers who will spend on housing, cars, travel, food, etc. to boost economy. Cut military, cut corporate subsidies, etc. Top 0.1% aren't spending their capital gains enough to boost consumption. Most American's savings rate is near ZERO....meaning they spend all they get.....not good for their retirement, but good for economy to get money flowing, create jobs, etc.

 

Bernanke to Congress: Get off of your high horse you idiots and give more productivity gains to average workers people to spend.

Thu, 06/07/2012 - 14:30 | 2504788 The Monkey
The Monkey's picture

What Bernanke really said to Congress: "We need you to do something on the fiscal stimulus front before we go balls out."

Actual quote: "I'd be much more comfortable if Congress would take some of this burden from us and address those issues," Bernanke said during a question-and-answer session.

Thu, 06/07/2012 - 14:37 | 2504808 Disenchanted
Disenchanted's picture

 

 

 

 

 

Herr Chairman is unhappy with the current crop of politicos he and his merry band of bankster-gangsters have purchased??

 

Boo-fucking-hoo...

Thu, 06/07/2012 - 11:14 | 2503845 tocointhephrase
tocointhephrase's picture

Bingo!

Thu, 06/07/2012 - 12:29 | 2504254 Liquid Courage
Liquid Courage's picture

Ditto!

Thu, 06/07/2012 - 10:41 | 2503662 smlbizman
smlbizman's picture

i am certainly impressed with linda sanchez from cali.......fuck me...

Thu, 06/07/2012 - 10:27 | 2503559 Hugh_Jorgan
Hugh_Jorgan's picture

Benny to advisor: "psst, how do I say that nothing is changing except that we aren't changing anything for a longer period of time?"

Thu, 06/07/2012 - 10:02 | 2503390 Clueless Economist
Clueless Economist's picture

I am expecting the Chairman to tell the truth today.

Thu, 06/07/2012 - 10:07 | 2503424 Cognitive Dissonance
Cognitive Dissonance's picture

Ben "The Candy Man" Bernanke will not disappoint the market. He just might not give out the sweets today.

Thu, 06/07/2012 - 10:30 | 2503575 Manthong
Manthong's picture

He and his ilk have destroyed the fundamentals and consequently the technical aspects of what used to be a somewhat free market and is now just a central bank racket.


The smug little shit controls the world until the unexpected happens and a forces cataclysmic inversion of FV and PV on him.

Thu, 06/07/2012 - 10:36 | 2503620 Schwetty Shorts
Schwetty Shorts's picture

He better disperse the candy before the face-eating zombie algos latch on to the remaining drunk+homeless retail investors... FFS Ben, the beard will only slow them down!!

Thu, 06/07/2012 - 11:33 | 2503946 Chupacabra-322
Chupacabra-322's picture

Can someone, anyone group of honest Police/Military arrest this motherfucker along with 534 House members (excluding Ron Paul) plus 99 Senate members (excluding Rand Paul) plus a President/VP and attorney General.

Charge them with Treason, Crimes Against The American People, Crimes Against Humanity.  Have a fair trail, convict, then execute them? 

Can anyone please? 

Hello?  Anyone? 

Thu, 06/07/2012 - 11:45 | 2504006 AldousHuxley
AldousHuxley's picture

you mean like gabrielle giffords, lincoln, JFK, etc?

 

Politicians are there as a buffer between the real owners versus pawns. Morgans, Rockefellers, Rothschilds want you to shoot the puppets rather than the man behind the curtain.

 

Bernanke is controlled by white house. White house is controlled by multinational interests. Multinational interests are owned by wall st. Wall st's largest investors are.......top 1000 wealthiest families in the world.

Thu, 06/07/2012 - 10:25 | 2503470 tarsubil
tarsubil's picture

The weather has once again foiled Ben's plans for economic success. Damn you weather!

ZIRP4EVA!!!

Let's Twist again, like we did last summer!

QE to infinity and beyond!

Thu, 06/07/2012 - 10:23 | 2503529 kralizec
kralizec's picture

Damn, that there is funny!

Thu, 06/07/2012 - 10:44 | 2503688 bigerny
bigerny's picture

That depends,are his lips moving or not.

Thu, 06/07/2012 - 10:52 | 2503743 Zero Debt
Zero Debt's picture

His mouth seems to move faster than his beard. Definitely a suspicious sign.

Thu, 06/07/2012 - 10:02 | 2503393 SeverinSlade
SeverinSlade's picture

Committee Chairman: We also need you to shave your crotch.  Those trillions of times you hit CTRL-P must be compensating for something.

Thu, 06/07/2012 - 10:04 | 2503407 Banksters
Banksters's picture

Comrades, 

 

Contrary to what your instincts or intellect may tell you, bailing out banks is not a form of moral hazard or cronyism.   Nor does it create an uneven playing field.  Banks, dear comrades, are necessary middlemen.   Much like the mosquito, tapeworm, or deer tick,  they are  part of the ecology of business and commerce.

Thu, 06/07/2012 - 10:08 | 2503427 azzhatter
azzhatter's picture

banks are merely utilities. A clearing place for transactions. The fact they have become such a large part of our economy has led to destruction and chaos. Fuck You Bernanke

Thu, 06/07/2012 - 10:18 | 2503493 walküre
walküre's picture

Every good host needs a few parasites. We're in a symbiotic relationship with our banking overlords. They get to live the "life" and we get to work for them. We should consider ourselves lucky that our parasites don't suck out every last bit of blood.

Thu, 06/07/2012 - 10:23 | 2503524 Spastica Rex
Spastica Rex's picture

Haven't yet sucked out every last bit of blood.

FIFY

Thu, 06/07/2012 - 10:39 | 2503645 Schwetty Shorts
Schwetty Shorts's picture

Without banks there could be no Muppets... and everyone loves Muppets!

Thu, 06/07/2012 - 10:01 | 2503381 SeverinSlade
SeverinSlade's picture

Expecting Bernanke to say the Fed is concerned but must wait and see before taking further action...Translates to: Europe needs to burn before I hit CTRL-P.

Thu, 06/07/2012 - 10:04 | 2503383 slaughterer
slaughterer's picture

CTRL-P pre-announcement day.

 

Here it is:

BERNANKE SAYS FED READY TO ACT, REFRAINS FROM DETAILING STEPS

 

Gold to $2000.

Thu, 06/07/2012 - 10:14 | 2503426 fuu
fuu's picture

Or a blowtorched freefall of $20...$25.

Thu, 06/07/2012 - 10:15 | 2503463 tmosley
tmosley's picture

Blowtorches work well against paper with the word "gold" printed on it.  The metal, not so much.

Thu, 06/07/2012 - 10:21 | 2503508 fuu
fuu's picture

ZIRP through 2014.

Thu, 06/07/2012 - 10:23 | 2503530 tarsubil
tarsubil's picture

I think you have dysleksia. That should be 2140.

Thu, 06/07/2012 - 10:25 | 2503535 fuu
fuu's picture

Ok he said at least through 2014.

Thu, 06/07/2012 - 10:26 | 2503549 tarsubil
tarsubil's picture

Oh wait, my bad. That should be 4102.

Thu, 06/07/2012 - 11:14 | 2503844 beachdude
beachdude's picture

Civilization technologically decends to 1024.

Thu, 06/07/2012 - 12:09 | 2504159 THX 1178
THX 1178's picture

BC?

Thu, 06/07/2012 - 10:27 | 2503550 tarsubil
tarsubil's picture

NSA interference led to a duplication in the matrix.

Thu, 06/07/2012 - 11:36 | 2503964 fuu
fuu's picture

$30...$35...$40...

Thu, 06/07/2012 - 10:08 | 2503428 walküre
walküre's picture

Gold smash down in progress, comrade.

Thu, 06/07/2012 - 10:15 | 2503464 Al Huxley
Al Huxley's picture

Pretty great that all it took to fix the US economy was a few words out of an economics professor.  Used to be you'd have to actually invest capital and make something, and then sell it, so much easier these days though.  God bless the FIRE economy.

Thu, 06/07/2012 - 10:24 | 2503538 walküre
walküre's picture

They frontran gold to create the illusion "gold knows something".

They're down to the lowest of the lowest tricks.

No more magic, no more POOF.

Game over and they know it. Discussed with a few buddies last night how the system is going to fail and we all (10 of us from different walks of life) all agreed. Everyone knows that the system is in its final stage.

BANK RUN 2012

Thu, 06/07/2012 - 10:45 | 2503697 Global Hunter
Global Hunter's picture

I've noticed a few family and friends that a year ago found me to be a humourous oddball are actually frightened now by what is going on.  I'd agree people are figuring out that something is not right.

Thu, 06/07/2012 - 10:53 | 2503747 walküre
walküre's picture

China's move this morning and even the timing of the announcement reek of TOTAL DESPERATION.

Look at the BDI that's free falling again. And it's only June!

Thu, 06/07/2012 - 12:05 | 2504140 madmax1965
madmax1965's picture

Yup, same here.  Was at a party last weekend and had a conversation about the FED etc., and for the first time I was not looked at with the deer in the headlights look!  Slowly, people are waking up, what that means, who the hell knows!

Thu, 06/07/2012 - 11:17 | 2503861 AlaricBalth
AlaricBalth's picture

Al,
I'm old enough to remember a simpler time when equities were bought and sold based upon ancient metrics such as p/e ratios, PSR's, dividend yields, earnings and other microeconomic factors. Our "bible" was Graham and Dodd's Security Analysis and investment banks actually were in the business of capital formation.
I guess it's time to put myself out to pasture.

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