Russell Napier On The End Of Supply & Demand, Bank Nationalizations As An Upside Catalyst, And Relative East Vs West Value

Tyler Durden's picture

Following up to his must read September 20 presentation from the CLSA economic forum titled "Darkness on the Edge of Town" in which the core topic was the upcoming cliff in the capacity of monetary intervention to impact the economy (something which apparently did not prevent the BOE or the ECB to announce further monetary easing in the subsequent weeks, and which in our opinion will have no impact on the Fed as it eventually sets off on its own merry LSAP path), is the following interview given to Bloomberg TV in which the strategist, previously known for his bold S&P at 400 prediction, in which he defines the new regime as one where supply and demand no longer matter, and all is determined by centrally planning governments across the developed world. The conclusion is that while as a result of failed government policies the developed world stagnates, and the market tumbles, as a result of "earnings not holding up and thus driving stocks lower", it is Asia where any potential growth remains, and as such investors should take their dollar holdings and dump them in India (for example). One last topic was the imminent nationalization of numerous European banks (over and above what happened with Dexia, and the follows up from earlier today, Greek Proton and Danish Max). In some ways, Napier put his finger on today's market pulse when he said that investors will paradoxically like a bank nationalization as it will remove uncertainty if only in the short-term. "It is a very negative long-term thing for Europe" he says, but adds that "speaking to investors at the CLSA economic forum they are so convinced the euro is going to collapse that when it doesn't collapse, the market will probably go up." That said he concludes, "this is a major structural turning point and a bad thing for return on capital in Europe." Oh well, who cares about a year, or a month, or even a week into the future. Career risk is here and it is right now, and one must do precisely whet everyone else does.

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MillionDollarBonus_'s picture

Mr Napier is totally misguided on this one to the point where I am left scratching my head. Clearly in a centrally planned utopia (which is where we are headed whether nasty libertarians like it or not), prices will be determined by and according to the preferences of the governing body. Hence the price of the S&P will simply be set at a desirable price, like 10,000. This is the beauty of central planning - the erratic perceptions and preferences of uneducated market participants no longer interfere with objectvie price setting.

hambone's picture


true dat - no more haggling neccessary to match buyers / sellers. 

In our new world the price is the centrally determined price and investors from (confiscated) govenment protected 401ks / IRA's will be (forced) afforded the ground floor opportunity of (mandatory) patriotic aMerican asset (worthless shit) ownership w/ great upside (massive losses to be forcefed)...also known as bank nationalization in less sophisticated countries.

Tax payers and losses to suffered...Match made in heaven.

whstlblwr's picture

Just see video of Herman Cain and stupid words against protestors on Wall Street.

Cain say protestors angry at the successful bankers on Wall Street. He says protest anti American movement to distract the people from failed Obama policy…really?

Maybe you’re trying to distract. Maybe you want to be President of the United States to give more bonus money to CEO’s of failed company. It’s what you believe in, right? Your American form of capitalism. Steal money from employees, but reward poor performance?

The Occupy Wall Street movement protests against Wall Street insiders who fail but get bailed out anyway. How about the Federal Reserve printing DOLLAR to give rich banker buddies so they can keep operating scams against American people?

How about the government let the bankers fuck us and say “here banker you want to fuck American people, go ahead fuck them some more, here take what you want, we’ll help you.” How about that 1% who lie cheat steal but don’t care because Bernanke have their back. Fuck you Herman Cain, you think protest anti-American. Then do you know history America?

Maybe you need education you and Tea Party. Organized Tea Party, LOL!! They are joke too.

Here is information because you too wrapped up in warped view of world. The Boston Tea party happened because the government failed to act on behalf of people, failed to protect people against corporate greed of East India Company.

"The Boston Tea Party was a direct action by colonists in Boston, a town in the British colony of Massachusetts, against the British government and the monopolistic East India Company that controlled all the tea imported into the colonies. On December 16, 1773, after officials in Boston refused to return three shiploads of taxed tea to Britain, a group of colonists boarded the ships and destroyed the tea by throwing it into Boston Harbor."--wikipedia

So fuck you Herman Cain, and Tea Party who keep screaming Occupy Wall Street is from Obama. You're idiots.

BandGap's picture

Self medicating again, I see.

Rich_Lather's picture

Neither KKK, or self-medicating. A Chinese national or other foreigner chiming in.

Jack Napier's picture

Russ always was the black sheep of the family.

legal eagle's picture

Careful how you use the word utopia, how about "centrally planned lunacy"?

The Deleuzian's picture

MDB:  I gave you a 'greenie' because you always bring a smile to my face...You are sooooo needed...You don't even know your value!!!

topcallingtroll's picture



rocker's picture

The best way to help Occupy Wall Street and Hamy.

Boycott the Stock Market. Don't Buy Stocks.    Think of it this way. The HFTs won't have anybody's money to Steal then.

The Stock Market is headed for a Crash anyway due to the financial crisis. Which is not over. Nobody went to Jail for the crisis.

This is a first.  Who are the bankers paying off to stay out of Jail.

Did anybody know that J.P. Morgan donated 4.6 million to N.Y.P.D.

This is proof that money can buy anything. Support Occupy Wall Street.

reader2010's picture

Are you saying perpetual motion machine will work this time around? The stupidity is that they believe they're not a product of creation,  and they're always above the law that governs the universe. 

MillionDollarBonus_'s picture

As it happens, I hope that technology does enable us to immortalize some of the economic greats of our times. Just imagine the gift of knowledge we could bestow upon our children by preserving the life of a Paul Krugman or a Joseph Stiglitz. In fact I genuinely believe that if the honourable Lord Keynes were alive today, he would have captured the imagination of a generation with his ideas of fiscal and monetary stimulus and we wouldn't be in this mess in the first place.

legal eagle's picture

OWC is going to be visiting billionaire's homes now.........heard it first on Kudlow?????

First time in a year not hearing news first here on ZH

knukles's picture

Bravo, sir.
You have firmly established your position as ZH's newest foil for ridicule.
We all know that it is not nice to make fun of the handicapped, but in your instance sir, that civil courtesy has been waived by God hisself.

Problem Is's picture

So if we ridicule him...

We are doing God's work?

clymer's picture

I refuse to believe that MDB is serious. I get it! You're trolling, MDB! haha - you almost had me there, you troll, you.

Manthong's picture

 "preserving..  Paul Krugman or a Joseph Stiglitz."

Sounds good to me.

Where's the formaldehyde?

Jendrzejczyk's picture


May we bring back the golfclap for you sir?

ReadySteadyGo's picture

Aha!  I see what you did there!  You wascally wabbit you

Two Towers AU AG's picture

Tyler Durden  for President 2012

Hit the Like button (green arrow) if you agree...

FreedomGuy's picture

But they cannot make it work because over time the price controls fall apart. They fix the price of the burger. Then they have to fix the price of lettuce, tomatoes and ketchup, then the price of fertilizer for the tomatoes then the price of fuel, then the price of....

Damn keynesian central planners always fall to their own conceits.

Hobbleknee's picture

USSR already proved central planning doesn't work.  There is no way for the state to determine prices, nor determine what the people want.

PaperBugsBurn's picture

WTF is going in??? Fucking sellouts!!!

Why da fff haven't you Tylers covered this???? All that bitching and there you go... selling out!!!

Officially announced on October 3, 2011, the "Occupy the Federal Reserve" movement called for by pro-freedom pundit Alex Jones and augmented by "End the Fed" movements nationwide, is set to begin this weekend. Despite the implications of large crowds convening upon America's central bank, run by the very corporate-financier interests that have abused Wall Street and stirred up the "Occupy Wall Street" crowds in the first place, not a word of it has been spoken in the Western media - in fact a Google News search for "Occupy the Fed" retrieves the following, cartoonish headline: "Occupy Wall Street finds sympathy in the Fed."

And looky here:

2012 like Herman Cain, a former Federal Reserve chairman, makes such pandering farcical if not entirely offensive to the American people's intelligence. Not only are Americans calling this hubris-filled bluff, but so are foreign pundits overseas.

Some of you morons around here been fawning abt this Cain scumbag.

WTF!!???  You like being slaves or is it that you know once this Ponzi comes down you'll have to get real jobs??

Fight Club? What a joke!!


baby_BLYTHE's picture

The FED is the enabler of all the ills in the economy, the banks should be protested and despised... But never forget the FED is the entity that allows for the creation of reserves they hold, the money they lend out at usurpous interest rates, money they the banks 'print' via fractional reserve lending and now (hilariously) charge fees for the privilege of accessing depositor's such funds!
If the FED were ended, the banks would stand completely on their own... The minute their cash flows seized up no entity would exist to prop up their garbage and would be forced to fight to keep their customer depositors confident in their business.

Ending the FED is a huge step in restoring America to her initial ideals of individual initiative, personal responsibility and freedom to succeed. I support Alex Jones in his efforts to draw attention to the criminal elements within our financial system and central planners of the FOMC that dictate the direction of our financial markets and price fixing the supply of money.

zorba THE GREEK's picture

And to add to what you just said Baby, ending the Fed would mean a return to sane markets

with equities and commodities being priced on fundamentals, not to mention interest rates

in line with inflation expectation so as not to punish savers and the elderly.

clymer's picture

And I support you, bb. You're still a kid, but run for fucking office, will you? Wake up the world? ..too many still asleep. we're fricken doomed

lynnybee's picture

I support Alex Jones in his efforts to draw attention to the criminal elements within our financial system and central planners of the FOMC "     ..... god bless ALEX JONES & keep him safe.    

DormRoom's picture

The Fed may have bailed out the banks, but it failed to recognize the banks as an instiution are socialopaths.  So they basically resicitated a group of serial killers out to harm us all.

Problem Is's picture

The Fed IS the TBTF banks... Look at the shareholder of the FRBNY:

JPM, Citi, Chemical Bank, Manufacturers Hanover Trust, Bank of New York, Bank of England, etc.

They bailed themselves out. The Fed knows what they are because they ARE the Fed...

Gohn Galt's picture

Herman Cain, both what he says and what he does puts him high up on the "who would you want to fight list". 

As far as the rest, I don't have to depend on the government for food, shelter, electricity, power or protection.  I depend on government to fuck me whenever they can.  If you depend on the government for anything then you are a beggar with no rights (payoffs excluded).  Only by moving forward on your own terms can you shape your destiny.

wisefool's picture

Not sure if you are supporting him or not, but when you take the complexity out of the tax code, the complexity will be excised from the government and the political classes.

The same position would be true if we removed the other arm of bubble making machine, which is the monetray supply, which Ron Paul would remove.

Anyone who can not see that the fed takes the tax code and puches in the face and vica versa with the alternate arms of OUR government.

rocker's picture

I hope that was Sarcasm SwingForce.  It was made on Aug 14 and Revised on Sept.20.

The S&P has fallen since then.

Money 4 Nothing's picture

They realized that there is more money to be made in the Military Industrial Complex than collecting tax reciepts.

They don't want your money, they own the printer, so figure out where you stand in the NWO, 4 quarts of oil? wake up.

Pegasus Muse's picture

Chris Hayes: Erin Burnett's Wall Street Coverage 'So Frustrating' (VIDEO)

MSNBC host Chris Hayes was the latest person to take CNN's Erin Burnett to task for her trip to the Occupy Wall Street protests last week. 

byteshredder's picture

Is Chris Hayes the twin sister of Rachel Maddow?

SwingForce's picture

Hey how about an article written by a Little Guy? Fuck these assholes who think they know "FINANCE", they don't know shit. That's why the market crashed today, because this douchebag knows what he's talking about, not. FU!

walcott's picture

complete crockery.

DosZap's picture

 In some ways, Napier put his finger on today's market pulse when he said that investors will paradoxically like a bank nationalization as it will remove uncertainty if only in the short-term.


Please,define "SHORT TERM".

chump666's picture

like now, week or so of rallies, now overbought.  investors then get slammed with a panic once the rating agencies start downgraded EZ countries one by one, starting with France...those butnuts