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Retail Investors "Just Say No" To Bernanke's Artificial Wealth Effect

Tyler Durden's picture


And so the great standoff continues. On one hand, the Chairman will literally do anything and everything to get the retail investor to break their 4 year boycott of stocks, and come rushing back to the artificial and fabricated safety of an endlessly rising market: after all he has gone so far as to implicitly guarantee that there will never be a -1% day in the market ever again: all natural market forces will be crushed in the pursuit of the great asset bubble-based "wealth effect." On the other hand, the retail investor, older, wiser, and most importantly poorer, observing inexplicable and unpunished daily flash crashes across the numerous 'highly frequently traded' asset classes, still recovering from a market in which everyone told him to buy only to see a 50% loss in months, with ever less disposable income, is no longer interested in said "wealth effect" proposition, or any other proposition premised on the artificial manipulation of the political construct once upon a time known as the market, no matter how many personal guarantees of perpetual QEasing the Chairsatan will hand out. The culmination: the week ended September 12 domestic equity mutual funds saw the 8th consecutive outflow from stocks, amounting to $2.8 billion, and 32nd outflow of 37 weekly readings in 2012. The brings the total cumulative outflow year to date to $92 billion. The same period in 2011 had a total outflow of $79 billion, even though the market now is not only higher than it was in 2011, but the highest it has been since 2007.

Past two years:

And longer-term:

Of course, if the retail investor was still as dumb as everyone believes is the case (and still had money to invest in stocks), this cumulative outflow would be far smaller. It isn't, and that in itself is a testament that more than the absolute level of the S&P, the now virtually extinct investor class has always been far more interested in knowing how it got there. It appears that dollar dilution and outright manipulation just don't cut it when trying to inspire confidence in investing in stocks any longer. Or ever. Who would have thunk it...

Sadly what this means is that the lunatics in the Marriner Eccles building, who will not take no for an answer, will continue with their artificial inflation of equities, until such time as the retail herd comes storming back. Which it won't, and can't. And the charade will continue until it can no longer be perpetuated. At that point equities will finally tumble to fair values, and then, and only then, will the retail investor finally return to the stock market.


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Wed, 09/19/2012 - 21:40 | 2813580 vast-dom
vast-dom's picture



Wed, 09/19/2012 - 22:03 | 2813645 Precious
Precious's picture

Bernanke seeks greater retail participation by making the markets wholly irrational.   That ought to work well.

Wed, 09/19/2012 - 22:22 | 2813689 hannah
hannah's picture

better off with a gransfors bruks axe....cant beat lodge cast iron.

Wed, 09/19/2012 - 22:32 | 2813700 hedgeless_horseman
hedgeless_horseman's picture



better off with a gransfors bruks axe


Another fine choice.  I like to buy locally made items when I can, and go with the best when I have no local option, like Zeiss. 

Wed, 09/19/2012 - 23:12 | 2813793 hannah
hannah's picture

cant beat zeiss glass...!

Thu, 09/20/2012 - 06:15 | 2814180 neidermeyer
neidermeyer's picture

Zeiss is great but severely overpriced (I have many cameras with Zeiss optics) .. Go with Vivitar "Series 1" for 99% of the performance at 1/3rd the price.

Thu, 09/20/2012 - 06:55 | 2814220 ClassicalLib17
ClassicalLib17's picture

I had a hand-me-down vivitar camera that took excellent quality pictures, back in the early 70's.  Then I decided that I would invest in a better(pricier) Olympus camera, and I have to say, the pictures didn't look as bright and color-rich as my vivitar would produce.  A good lesson learned.

Thu, 09/20/2012 - 06:03 | 2814174 smlbizman
smlbizman's picture

i would think it is more of the smart "movable" money that continues to leave....not the retail people who must keep their "trapped" money in the 401ks friend can take his money out of his 401 as soon as he quits his job...

Thu, 09/20/2012 - 06:34 | 2814198 Bobbyrib
Bobbyrib's picture

You don't have to invest in the market in your 401K. My 401K for example has a cash equivalent with a 100% allocation (by me).

Thu, 09/20/2012 - 05:43 | 2814161 muppet_master
muppet_master's picture

i did SHORT last Fri

when spx @ 1475 and eur @ 1.315 i even called it THE TOP...NOT just A TOP.

Wed, 09/19/2012 - 21:42 | 2813585 Seasmoke
Seasmoke's picture

Public employees are the only ones with disposable income and they do NOT like RISK

Wed, 09/19/2012 - 22:30 | 2813702 knukles
knukles's picture

In CA no need to take risk when the Defined Benefit Pension (exceedingly generous) Post Retirement Health Care Benefits (none better) which are for all intents and purposes no longer available in the private marketplace are funded out of the taxpayer's hides including the Abysmal Horseshit Money Management provided via Public Investment Arms of the Gubamint, want to hire cronies, kickbacks and the like, let alone the constant concerns of not properly calculating the full benefit obligation (ABO vs PBO) and Golly Gosh continual stories circulating about maybe not having marked all the crap to market properly.

No fucking reason to take risk, they've transferred it all to the private sector, the taxpayer which simply does not have the capacity to carry anymore public largesse....

Wed, 09/19/2012 - 23:27 | 2813817 oldman
oldman's picture


Sorry, maybe you just made the wrong choice of how to put bread on the table.

I'm pleased that I never wanted security---especially when I lived those 37 years in sunny Southern Cal----but, shit, I ended up with a lot to fret over anyway. If i had taken a gov't job maybe I wouldn't still be making decisions about how to protect 'this and that'.

An oldman hardly knows what to do anymore     om

Thu, 09/20/2012 - 06:36 | 2814202 Bobbyrib
Bobbyrib's picture

That sounds a lot of like NJ to me. I think people are going to be very surprised if and when the market eventually collapses how bad state pensions will tank like in the last stock market collapse.

Thu, 09/20/2012 - 07:08 | 2814231 B2u
B2u's picture

Who is going to pay the Defined Benefit Pension when there is no more money?

Thu, 09/20/2012 - 11:01 | 2815002 Kayman
Kayman's picture

They will have to create a special "super tax" on Government Employees.  That ought to fix it.

Wed, 09/19/2012 - 22:46 | 2813730 otto skorzeny
otto skorzeny's picture

They sure do like their pools- I had a couple of different cops in my McMansion 'hood put in $50k+ worth of in ground pools this summer. Must be to unwind from the stress of writing tickets all day.

Wed, 09/19/2012 - 22:57 | 2813767 10mm
10mm's picture

Where would that be otto?

Wed, 09/19/2012 - 22:59 | 2813772 otto skorzeny
otto skorzeny's picture

the sleepy hamlet of shorewood IL

Wed, 09/19/2012 - 23:18 | 2813802 10mm
10mm's picture

24 sworn officers,population aprox 16k,salarys 51+ to 73K,must be some sleepy hamlet.$$$$$ thats alot of coin for a small population.

Thu, 09/20/2012 - 00:43 | 2813945 otto skorzeny
otto skorzeny's picture

I've got the tax bill to prove it-although i have shaved 40% off of that by showing recent comps to assessor-I tell idiot neighbors to do it but they're like "why even bother?"-says alot about US society

Thu, 09/20/2012 - 07:57 | 2814297 10mm
10mm's picture

The party will end for some of those employees,just a matter of time.That salary and population can not sustain each other.

Wed, 09/19/2012 - 21:42 | 2813586 Hedgetard55
Hedgetard55's picture

Bernanke trying to increase employment by buying MBS is like me trying to increase the number of red wines in my cellar by buying more Chardonnay and Sauvignon Blanc.

Wed, 09/19/2012 - 22:56 | 2813764 SafelyGraze
SafelyGraze's picture

as I explained to my grandkids when the satellite dish crapped out, we're just going to keep scrubbing the floors until that dagblame tv comes back on. 

me and granpa Nank. we think alike. 

Thu, 09/20/2012 - 00:27 | 2813925 Nobody For President
Nobody For President's picture

+1 for dagblame

Thu, 09/20/2012 - 03:45 | 2814095 dubbleoj
dubbleoj's picture

no no no, just add a little seasonal red dye.

sauv blanc==>cab sauv

havent you ever cooked (books) before?

Wed, 09/19/2012 - 21:43 | 2813588 Dr Benway
Dr Benway's picture

The retail investor has been fucked so thoroughly that even the most thunderous QEeef fails to amuse

Wed, 09/19/2012 - 21:43 | 2813589 Hedgetard55
Hedgetard55's picture

... or trying to fix a blown engine by adding more oil to it.

Wed, 09/19/2012 - 21:46 | 2813590 CClarity
CClarity's picture

More QE! More QE! oh Yippee! Oh Yippee!!!

New soap opera "As the Fed Fumbles"

Wed, 09/19/2012 - 21:43 | 2813592 I_Am_
I_Am_'s picture

I have given up. I have tried to stomp back but kept hitting a wall and now too tired to even limp..... Buy and hold.. what shit...

Wed, 09/19/2012 - 21:43 | 2813593 slaughterer
slaughterer's picture

Retail investors want a 50% off sale, not this continual levitation.

Wed, 09/19/2012 - 22:04 | 2813651 Precious
Precious's picture

As every grasshopper knows, only stupid ants store food for the winter.

Wed, 09/19/2012 - 23:31 | 2813829 you enjoy myself
you enjoy myself's picture

which is why i'm still genuinely shocked Ben unleashed QEi when we're over 1400 and there's been maybe 10 down days all year.  what, do you think retail going to jump in at 1500, while its obvious to anyone with money to invest that the freaking world is about to blow up?   its not just 2008 that investors are remembering, but 2001 too - the steady rise after 2002 was at least based on a roaring economy (though of course debt fueled). 

if Ben hadn't gone full retard, and allowed for even a slight correction, he might have gotten retail dipping back in.  but everyone can now recognize the house of cards for what it is, precisely because he went too far.  even Madoff knew to keep returns at 10% or so - you show 30% every year no matter what and even idiots can sniff it out.

Wed, 09/19/2012 - 21:44 | 2813594 fonzannoon
fonzannoon's picture

the retail guy's 401k is very much still in the market. if the market fell to it's reality based levels it's game over for the stock market

Wed, 09/19/2012 - 22:49 | 2813741 ltsgt1
ltsgt1's picture

I moved my 401k to cash in March.

Wed, 09/19/2012 - 23:02 | 2813777 toady
toady's picture

Everyone has, that's the point of the story.

If you still haven't you better get started on it yesterday!

Wed, 09/19/2012 - 23:29 | 2813820 yatikto
yatikto's picture

actually its not that easy.

you have to lose your job or have a significant hardship.

Wed, 09/19/2012 - 23:54 | 2813849 toady
toady's picture

I know more than a few that are in trouble for taking 'loans' against their 401k and never paying it back. My wifes company was bought and all the employees were made contractors. That's how we cashed out.

Wed, 09/19/2012 - 21:45 | 2813598 saycheeeese
saycheeeese's picture

Retail investors are also voters and show that trust and faith in the gvt and its institutions have been lost but who cares.... The HFT algos have taken their place in the rush for endless wealth.

Wed, 09/19/2012 - 21:46 | 2813599 CClarity
CClarity's picture


Wed, 09/19/2012 - 21:46 | 2813603 jim249
jim249's picture

Oh so right! I have been waiting for 3 years for a correction like that was seen during the Great Depression. Bernank is a real dumb ass!

Thu, 09/20/2012 - 07:22 | 2814243 WhiteHose
WhiteHose's picture

patience jim! its comming. it not nice to fool mother market! fuck the bernank!

Wed, 09/19/2012 - 21:48 | 2813609 Mae Kadoodie
Mae Kadoodie's picture

QEeen.  We Will, We Will Rock You!


Wed, 09/19/2012 - 21:52 | 2813617 new game
new game's picture

fuck stocks

fuck the stock market

fuck the participants

fuck the millionaire shareholder

fuck the regulators

fuck the financial advisors

fuck the market makers/brokers

and most of all, fuck you if you are stupid eneough to buy and sell stocks!!!!

Wed, 09/19/2012 - 21:55 | 2813625 new game
new game's picture

everybody i know has moved on and WILL NEVER BE BACK  to this insider rigged looser ripoff scam!

Wed, 09/19/2012 - 22:10 | 2813664 chump666
chump666's picture

Forget the markets, buy some gold, have fun and think of business ideas.

I guarantee that this market will collapse spectacularly, with or without the idiots at the Fed. 

Wed, 09/19/2012 - 22:44 | 2813728 ltsgt1
ltsgt1's picture

I have 50% in rental properties, 30% in PMs, 5% stocks and 15% cash. I was waiting for S&P to return to 9000 but I don't think I will be bother with the equity market any more. I don't want to add any more PMs so I'm looking to spend half of the remaining cash on a farm with acreages.

I still cannot believe it is going to happen but I think we have reached or already passed the point of no return.

Wed, 09/19/2012 - 22:49 | 2813739 otto skorzeny
otto skorzeny's picture

ammo will some day be worth its weight in gold. a stockpile of refined gas never hurts.

Wed, 09/19/2012 - 23:03 | 2813779 chump666
chump666's picture

+1 brother.

By land, farm land, grow stuff, sell stuff.

Wed, 09/19/2012 - 21:57 | 2813628 chump666
chump666's picture

The problem is volatility, yes, the central banks have created an illusion from the July lows.  But...the wild swings are about to pick up again.  It is not a market for anyone who isn't prepared to trade with the smart money, which, is trading precisely on/off risk with HFTs trading on the moving averages. So far the market/s despite being overbought and looking topped out ranges are trading tighter by the day.

Buy and hold is dead because, yes, everyone is now poor.  Leveraged risk trades will be the norm, hence the coming big swings down and up.  Wall Street will be playing this too.  I'd look at another rogue trade creeping up again.

Just a dirty, nasty market.


Wed, 09/19/2012 - 22:39 | 2813722 Yen Cross
Yen Cross's picture

Chump, please tell me you caught my aud/jpy info last night? You watched the 23.6% Fibo@82.60 for confirmation?

Wed, 09/19/2012 - 22:55 | 2813762 chump666
chump666's picture

Yes, I think I did recall saying 83.20 was a top after the loons at the BoJ did their thing.  But I missed that trade, just got stopped out on an index short which kinda sucked.  But...still juicy shorts on the topped ranges (most risk trades).  Also, I did see on wires/traders saying the the EUR is still short despite the money pumps.

The market looks confused, like a f*cked up drunk. 

Thu, 09/20/2012 - 00:41 | 2813941 Nobody For President
Nobody For President's picture

Confused is a good description - even with QEforever, volume is nowhere and indexes are range-bound as hell. Sometimes it feels like everyone is waiting for somebody else to DO something to get it moving again, up or down - just fucking move! Now it seems we are in wait mode for Friday. Black Swan, where the hell are you?

Wed, 09/19/2012 - 22:01 | 2813644 Diggintunnels
Diggintunnels's picture

Shorting stocks now may generate extreme losses, you would be playing their game.  Buy real assets with any paper money that you have.  Gold is always a store of value, no matter what the money printers want to say, they know it is the default currency and has been for thousands of years. 

Wed, 09/19/2012 - 22:07 | 2813650 Yen Cross
Yen Cross's picture

 Retail Investers, "Make their own decisions, > my Gumby Pal, "pokey"agrees!

Wed, 09/19/2012 - 22:08 | 2813660 ThunderingTurd
ThunderingTurd's picture

Silver, gold, and  If you are buyer of anyting firearms you should all check this site out.  People selling on the cheap because they need the fiat.  I always offer to pay in Au or Ag...6 transactions and all continue to want the fiat.  I try to educate on the value of physical currency and it fails each and every time.  Good for me I guess.  

Thu, 09/20/2012 - 11:20 | 2815049 BooMushroom
BooMushroom's picture

If they were looking for investments that held their value, they could just keep their firearms. You're barking up the wrong tree on that one. They're looking to pay the rent or the MasterCard bill, and they for sure won't take PM's.

Wed, 09/19/2012 - 22:13 | 2813673 Meesohaawnee
Meesohaawnee's picture

i find the price of crude the last week regarding events fundamentals.. i mean really , they dont even try to make it look legit.. at least try

Wed, 09/19/2012 - 22:14 | 2813677 lizzy36
lizzy36's picture

When the inflows start, when greed takes over, that is the sell/short signal.

Wed, 09/19/2012 - 22:47 | 2813734 Tyler Durden
Tyler Durden's picture

There will be no inflows because there is no discretionary cash to allocate. The last thing a retiring baby boomer needs is to generate a 10% return when there is the risk of a 50% wipe out: return of capital is the only game in town.

Also, the uberwealthy are no longer investing in stocks: they are putting their money into hard assets.

Thu, 09/20/2012 - 01:08 | 2813982 intric8
intric8's picture

So the uberwealthy are in fact, stalking the market for a nice, liquidity-based exit opportunity provided by the next batch of bagholders? They should stop holding their breath. Aint gonna happen unless an entirely new, revolutionary technology comes along. Zero point energy, or something like that.

Thu, 09/20/2012 - 01:25 | 2813988 random shots
random shots's picture

Baby Boomers are going to go full retard trying to make up for the lost decade.  Probably means the market will run higher before the next major correction. 

Thu, 09/20/2012 - 11:35 | 2815098 snowlywhite
snowlywhite's picture

you folks are deluded...


"The brings the total cumulative outflow year to date to $92 billion." - that's, what? 1 month of printing(officially)?

Wed, 09/19/2012 - 22:16 | 2813683 Dr. Engali
Dr. Engali's picture

Most of my clients and people I know are irratated because they know the fundamentals don't line up with the market. They know the economy blows, earnings are slowing , and margins are getting squeezed. At the same time the market continues higher. So they are all staying on the sidelines frustrated because they dont know where to out the money ,so they sit.... And wait.

Thu, 09/20/2012 - 01:37 | 2813995 Scalaris
Scalaris's picture

Apparently, when a dwindling economy results in dwindling sales across the corporate spectrum, which in order results in lower margins, lower profits and lower cash-flows, the natural result is a higher stock price for every company whose market value per share should at least have some correlation with the company's declining price/earnings ratio.

Yet the market keeps going up, while there's no current fundamentals to support its valuations, nor any forecasted optimism to support valuations based on future earnings, and this is apparently happening while nobody is participating through retail channels, because everybody is waiting in the side-lines for some reasonable market valuation, that bears some reasonable proximity to a book value - sans the Fed's constant market pumping rhetoric, or its free, and funnelled by its Primary Dealers, money, used for bot-trading the market through their prop desks, and bidding it upwards among their remaining selves. 

And yet, the mere thought of allowing for even some points of retrace to take place, will violate the Fed's mandate, which I'm conjecturing, is that a market not in a constant upwards trajectory throughout the year, will be reflecting the moribund state of an economic reality, unable to be supported by the collective struggling household anymore, because the house equity lost half its value, the owners were among the millions who were released from their employment, due to corporate downsizing in order to meet the dreaded margins, in order to keep the market price up, in order to appease the shareholders, and now said owners are forced to go through their meagre, if at all existed, savings, in order to keep up with the mortgage payments, as well as the perpetually increased price of vital commodities, ironically caused by the asset bubbles, as a by-product of the liquidity injections provided by Fed and their misallocation by its receivers, for its aforementioned mandate, in the first place. 

Thu, 09/20/2012 - 03:04 | 2814063 Nobody For President
Nobody For President's picture

A reasonable summary.

Shorter version:

Markets, employment and housing are FUCKED! Buy PMs.

Thu, 09/20/2012 - 14:54 | 2815787 avidtango
avidtango's picture

But the fact is that profits ARE up.  What's omitted is that they've come at the expense of workers.  Retail now has 25% fewer workers than before for the same size location.  Wages have remained stagnant, automation has proceded and (mainly) management was trimmed to the bone (the latter point was needed).  A company where I was consulting knocked out TWO layers of middle management without any visible negative effects.

BUT...there is a finite end to cost cutting.  And with inflation (real, not phony), the continued lack of buying and dismal outlooks, profits cannot continue forever.  Note the high PE (Obama did not have a clue what that was when asked - lol) compared to other market periods.

Thu, 09/20/2012 - 16:05 | 2816027 Scalaris
Scalaris's picture

When corporate CEOs, along with the higher management are bound to their monetary incentives, their primary mandate is to maximize shareholder value, particularly amidst an economically volatile climate, resulting in a slow to stagnant rate of growth.

For this to happen, and for a direct impact on profit margins, whose growth does not derive from any actual growth of earnings, the remaining choice is to reduce operational costs and expenses.

Even if the economy is indicating towards some aggregate growth, demand has remained weak in terms of sales growth, which by default forces businesses to adopt defensive modes with a focus on maximizing profitability of revenue, and enforce tight controls on costs by reducing inventory levels, cutting budgets and maximizing productivity per employee. 

And since the single biggest expense to any company is full-time employees due to payroll, taxes and benefits, a reduction of the labour pool is the only viable choice that can offer any substantial impact, along with superficial cuts in expense accounts and independent department budgets.

Furthermore, the demand on businesses to increase profits, from shareholders and Wall Street, has driven productivity higher and wages lower. Real wages are well below the long-term trend due to the large, and available, labour pool, which keeps wages and salary levels, suppressed.

This is the main reason for the soaring of pre-tax corporate profits, from less than $1.5 trillion in 2009 to $1.9 trillion in 2010 and almost $2 trillion in 2011, which confirms the assumption that lower revenues and demand is behind the historically high levels of corporate cash hoarding, after the reduction of the most substantial corporate expense.

Thu, 09/20/2012 - 07:21 | 2814242 new game
new game's picture


sounds like you are giving good advice and they are listening.

explain the flash point theory.

"do not buy anything that has a low flash point and burns rapidly"; mainly cotton and paper...

Wed, 09/19/2012 - 22:18 | 2813686 surf0766
surf0766's picture

all your redistribution are belong to us

Wed, 09/19/2012 - 22:18 | 2813687 devo
devo's picture

Every blue chip is 25-50% overvalued. There's nowhere to go but gold and gold stocks.

Wed, 09/19/2012 - 22:23 | 2813692 hannah
hannah's picture

the retail investor is loooong gone. bernanke is stuck with the whole equity market this time. this is going to be so much fun to watch.....

Wed, 09/19/2012 - 22:24 | 2813694 tony bonn
tony bonn's picture

and the 5 year cagr on the stock market is......? and for 10 years? i thought so....

Wed, 09/19/2012 - 22:26 | 2813697 Jack Burton
Jack Burton's picture

Good post. Bernanke is nothing but a stock market whore. He has only one mandate and that is to juice stock equity share prices at any cost to America and it's average people.

Bernanke will never rest until he has driven every saver into equities. He will maintain negative real interest rates on bonds, CD's, Money Market and bank accounts. ZERO for savers, until they are driven into his beloved stock market.

How in hell can you call it a MARKET, when it is driven and traded on the basis of Fed actions? You call that a free, capitalist market? It is a communist "iron rice bowl" guarnateed by the Federal reserve no matter what the cost to the real economy.

I usually don't use swear words in my posts as they serve no purpose. But I hate that fucking numbnuts Bernanke so fucking bad I have only one thing to say to that Banker's Whore. "Eat Shit and Die Mother Fucker".

Wed, 09/19/2012 - 22:32 | 2813704 devo
devo's picture

Just buy PMs and PM stocks. It pisses him off more than anything.

Also, that chick is smokin'

Thu, 09/20/2012 - 07:19 | 2814235 lakecity55
lakecity55's picture

All I have left is mining and oil.

Still restricted on the 401; moved it towards bonds.

Took a loan on half the 401 and bought Au, Ag.

Until there is a reset, it's too rigged.

Corzine types should be under indictment, not out free, bundling campaign funds.

After reading the 10ozt fake gold bar story, was glad I acquired small  and culled silver coins.


If you have a credit union, you can put $$ into the club accounts and get a decent short term return. Plus, the cash is there if you really need it.

Thu, 09/20/2012 - 03:06 | 2814065 Nobody For President
Nobody For President's picture

I DO hope you feel better now, Jack.

Very eloquent!

Thu, 09/20/2012 - 07:29 | 2814255 WhiteHose
WhiteHose's picture

fucking hilarious jack!

Wed, 09/19/2012 - 22:35 | 2813713 Arnold Ziffel
Arnold Ziffel's picture

It's somehow fitting that the "Endeavour" made its final voyage today.



Wed, 09/19/2012 - 22:55 | 2813761 otto skorzeny
otto skorzeny's picture

piss on that waste of billions of taxpayer $. the worst part is they had to cut down a bunch of trees on the route to make way for the POS.

Thu, 09/20/2012 - 01:05 | 2813977 AynRandFan
AynRandFan's picture

Let's start by elevating need above the average advancement of humanity.  Is that what you mean?

Wed, 09/19/2012 - 22:39 | 2813720 adr
adr's picture

If you are working every day to try to earn income, you don't have time to watch stocks to try and gain wealth from this market.

If you timed the major moves of Facebook stock over the past month you could have made a fortune. If you bought Facebook stock at $23 a month ago, you sit at $23 right now. If you bought on IPO day, you are still down 40%. Buy and hold isn't working out so well. Retail wants to use a buy and hold strategy.

If you bought FB right before Fuckerberg's little press conference, you are up 20% or so. Next week you might be up another 10%, or you might be down 15%. You just don't know.

That is why retail won't get in the game.

Wed, 09/19/2012 - 22:43 | 2813726 Yen Cross
Yen Cross's picture

 I see a heavily oversold"HOURLY on the Yen Crosses" that are ripe for the picking!

   Me, is getting long! aud/jpy, gbp/jpy!

Wed, 09/19/2012 - 22:44 | 2813727 kalum
kalum's picture

Bernanke. He has ruined what is left of my life.May he RIH along with his cohort Obama

Wed, 09/19/2012 - 22:46 | 2813733 Caviar Emptor
Caviar Emptor's picture

Less disposable income. Yep. Translated: as Biflation bites (the side-effect of ZIRP/Qinfinity) money is going toward necessities and hard assets. It's about survival now, no room for buying "pieces of paper with designer labels", aka stocks

Wed, 09/19/2012 - 22:49 | 2813738 the producers
the producers's picture

I thought his game of currency creation and destruction was done, Bernanke was too clever to continue QE. You think he really wants to keep his job? It makes no sense, his corporate masters must be terribly greedy and ordered him to continue. Left to his own devices, Ben would want to leave his day job and start making $10 Million a Year as Co-Chair of the next Citi.

Wed, 09/19/2012 - 22:49 | 2813742 lolmao500
lolmao500's picture

Want to shit your pants?

When the China Bubble Bursts

Read that. (if you didn't know already)

Thank God China's industrial index output in September was higher than in August... PMI 47.8 vs 47.6... to be revised down probably... but still, one more month of peace.

Wed, 09/19/2012 - 22:58 | 2813766 otto skorzeny
otto skorzeny's picture

nothing like starting a war based on nationalism to calm the natives and distract them from the economy-US to follow with same plan in short order.

Wed, 09/19/2012 - 23:49 | 2813864 jim249
jim249's picture

China would be an absolute melting pot if they tried that.

Wed, 09/19/2012 - 22:56 | 2813763 ECE
ECE's picture

people in this country (our own president) and around the world have no idea the catastrophic situation we are in.   We have all fallen asleep at the wheel and believed people better and smarter than everyone else would do the right thing!  

Last week witht the Fed Action almost sealed the horrific future that is inevitable now.   It is beyond the pale,  what centralized planning has done to this once great country.


Pray people, Pray hard!!!!



Thu, 09/20/2012 - 00:59 | 2813971 AynRandFan
AynRandFan's picture

Well said.

Wed, 09/19/2012 - 23:10 | 2813785 TheProphet
TheProphet's picture

LTSTG1: Did you move your 401k to a money market, withdraw it, or actually move it to cash?

I have a 401k with a Fortune 20 company. It has more than 100 investment choices. Cash is NOT an option. The closest I can get is a money market. The inability to get short, and no cash option are the surest signs a 401k is a rigged game.

Don't worry, just pour all your money in... it will go up forever, we promise.

Wed, 09/19/2012 - 23:35 | 2813836 ltsgt1
ltsgt1's picture

I moved it to money market. I haven't put much thought on the next move but maybe withdrawal is not a bad idea even with penalty.
I guess I will make my move after the election. If Obama were re-elected, I will spend it ASAP. If Romney were elected, I might need as much cash as possible for the much needed recession.

Thu, 09/20/2012 - 00:58 | 2813969 AynRandFan
AynRandFan's picture

If Romney is elected, you will need "ss much cash as possible" to bet on assets properly priced by supply and demnd.

Thu, 09/20/2012 - 07:01 | 2814221 Bobbyrib
Bobbyrib's picture

Please go back to Yahoo Finance.

Thu, 09/20/2012 - 09:34 | 2814657 AynRandFan
AynRandFan's picture

Never been there.  What's the matter, I don't say "Fuck You Ben" enough?

Thu, 09/20/2012 - 07:04 | 2814223 Bobbyrib
Bobbyrib's picture

Yeah, the American people have to decide which unqualified candidate will fuck them over. Why would you spend the money ASAP if the used car salesman gets re-elected? Are you afraid he is going to confiscate retirement funds? Might be better to be patient and let this shit show work itself out.

Thu, 09/20/2012 - 11:36 | 2815101 BooMushroom
BooMushroom's picture

If Mittens (correctly) says the FED should not be in the business of juicing the stock market, it will crash.

No confiscation required.

If Mitt fails to retroactively fix the fiscal cliff, the market will crash. If you know you will get taxed at 15% if you sell on 12/30 or at 35% if you sell on 1/2, why would you hold? Guaranteed 20% loss, neatly marked on the calendar.

Lots of theories, without even getting out my tinfoil.

Wed, 09/19/2012 - 23:38 | 2813842 yatikto
yatikto's picture

For all Ben's intelligence he lacks common sense.  He doesn't understand why people just don't accept the "fact" that he has unlimited supply of money, and deficits can go to infinity.  Why won't people just let go and embrace this new reality?!

Wed, 09/19/2012 - 23:51 | 2813865 barroter
barroter's picture

Yeah, they're desperate to con everyone back into the game.  The problem arises when they try to persuade you into some new financial vehicle, people's BS detectors start ringing like Big Ben.

Wed, 09/19/2012 - 23:56 | 2813876 enoch_root
enoch_root's picture


.... just leave this here for those looking for real answers.

Thu, 09/20/2012 - 00:25 | 2813920 AynRandFan
AynRandFan's picture

Excellent, really substantive and clear.

Thu, 09/20/2012 - 00:56 | 2813966 AynRandFan
AynRandFan's picture

The content is very complex, and delivered by someone who lives in an academic bubble.  Nevertheless, the information is very very good.

Thu, 09/20/2012 - 00:17 | 2813905 AynRandFan
AynRandFan's picture

The question of investor confidence is the most important issue to anyone buying exposure to any paper asset market right now.  It is hardly ever discussed, and while this article is a commendable treatment, the issue deserves much more focus.

If not for people risking substantial assets on behalf of hedge funds, pension plans, and a consensus of others, the present market would collapse.  It has no foundation in growth and is highly overextended for the amount of macro risk.

On a pure valuation basis, the market is not overextended.  However, central bank and other governmental interventions have almost erased market decisions based on supply and demand.  In my view, almost isn't good enough.  You either entirely control the movement of money or the market eventually will hunt you down and kill you.

It's called human nature, and it will win.

Thu, 09/20/2012 - 00:51 | 2813959 Lost Wages
Lost Wages's picture

I'm with the retail investors. Chain yourself to their bonds and if they want to take you out again, they have to raise interest rates.

Thu, 09/20/2012 - 00:53 | 2813961 AynRandFan
AynRandFan's picture

How much risk is there in a value exchange when the short term has proven safe and the long term becomes a guarantee of death?

The answer is human nature.  The amount of risk is determined by the uncertain nature of human beings to behave in that environment.  If risk, or the proper statistical answer is determined by human nature, then the proper bet is that people will act selfishly.  This is an empirical result.

The problem in predicting selfish human behavior is that people act primarily on the basis of social status.  Moral status being a derivative in most cases.  People will act for perceived social or moral reasons, but always combined with a selfish motive.  Power, safety, wealth . . . they are all the same.

Bet that people will rely on CONFIDENCE when making decisions.  It is a clear concept: cost/benefit.  Survival.

Do you feel confident enough to place your disposable wealth in the hands of a paper market exchange?

Thu, 09/20/2012 - 01:02 | 2813975 intric8
intric8's picture

I didn't think there were any sheeple left to draw money out of the market anymore. Are these foreign sheeple? Or the "neo-sheeple", aka mutual fund managers?

Thu, 09/20/2012 - 01:15 | 2813986 tawse57
tawse57's picture

Joe Public out in the real world has seen job losses, food and fuel rises and a stagnant economy whilst the stockmarkets have soared. They are not stupid and know this market is both rigged and top heavy. 

The question now is just how long it will be before the DOW/NASDAQ crashes BIG time - before or after the US election? This week or in 6 months time? It will lose 50 percent of its value and people know it. Bernanke wants retail to be the suckers but retail knows the markets are rigged. Checkmate.

Thu, 09/20/2012 - 01:50 | 2814006 q99x2
q99x2's picture

The parasitic algos are left to feed upon themselves. So too shall it be with the banksters that rely upon them.

Thu, 09/20/2012 - 03:00 | 2814061 Just Observing
Just Observing's picture

Here's a big FUCK YOU, Ben, and Wall St.


Took what was left of mine out, bought physical gold and silver and solar panels for my farm....and sleep like a baby at night.

No more Casino on Wall St for me.

Thu, 09/20/2012 - 04:27 | 2814118 rsi1
rsi1's picture

Call me when they start buying to sell all my longs, untill then, let me have a good time at the beach. :)

Thu, 09/20/2012 - 05:40 | 2814160 muppet_master
muppet_master's picture

don't sell YET !!! ok !

wait for spx to drop to 1000 this year pre-election...THEN u sell..right before the dead cat bounce !!

Thu, 09/20/2012 - 05:13 | 2814151 ebworthen
ebworthen's picture

Hah, hah Ben.

So funny.

They won't get me back into the stock market for anything.

Fucking roulette wheel with magnets under the table.

No rule of law, rampant chicanery and skullduggery.

Jon Corzine free as a bird.

Fuck you FED and Wall Street and Washington.

Thu, 09/20/2012 - 05:38 | 2814158 muppet_master
muppet_master's picture

corzine free bird =

bc ODUMMERNOMICS-RAPE-O-NOMICS buddy...obeyme gave him his "golden parachute"...LOL !!! @the hypocrisy !!!

Thu, 09/20/2012 - 05:36 | 2814157 muppet_master
muppet_master's picture

THIS retail investor said

YES I CAN to bQE and QEorganizer's ponzi scheme.  Last Fri = ADDED to SHORTS like crazy right @ the TOP @ spx 1475, EUR 1.315....I even called it THE TOP.

now spx futures are @ 1447 and eur @ 1.2940. = 210 pips in UNrealized gains...NICE !!!!! oh, but yesterday the eur was pumped from 1.3005 to !! i was shaking in my boots = NOT !! now @ 1.294...gimme sub 1.20 before i cover my first set of shorts and prepare for the dead cat avg SHORT price = 1.28 @ 15X

Thu, 09/20/2012 - 06:12 | 2814178 muppet_master
muppet_master's picture

a few days ago on foxbusiness:

some "regulator" cftc boss? last name = chilton...

was blaming the "cheetah traders" for the initial drop in oil in few that the best that kenyanomics can think of? a freaking cheetah? yes i know odummernomcs-dictatornomics has a carotid hold on every gov organization and tells then what to say.

the "regulator" said, see we need to regulate the cheetah traders...REALLY?

right @ QE3 i said sell everything ! including gold, OIL, eur and spx..and then on Fri = i said TOP for everything...If you had shorted oil @ $99 on Fri..and ROOOOOODE til now = $91...that's almost a the pace of a snail !!! LOL !!!

"cheetah traders" = odummernomic's cronny INSIDER buddies. freaking hypocrisy you can believe in !!!

Thu, 09/20/2012 - 06:20 | 2814183 Bobbyrib
Bobbyrib's picture

Next time Bernanke is on TV, I fully expect him to yell: "Hold the bag already!"

His friends in the banking industry are extremely concerned that they are the ones with skin in the game and retail investors refuse to buy into the Ponzi to buy overpriced shares to lower their exposure, or to sell out completely while collecting huge profits. If wealthy investors can't fleece retail investors into buying their overpriced crap, the stock market as we know it may end. Afterall, what would be the point of the stock market?

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