Dallas Fed's Fisher "Perplexed" By Wall Street "Fetish" With QE3 And Disgusted With The Addiction To "Monetary Morphine"

Tyler Durden's picture

And now for some pure irony, we have a member of the Fed, granted a gold bug, but a Fed member nonetheless, one of the same people who not only enacted ZIRP, but encourage easy money every time there is a downtick in the market, complaining about, get this, Wall Street's "continued preoccupation, bordering upon fetish" with QE3. The irony continues: "Trillions of dollars are lying fallow, not being employed in the real economy. Yet financial market operators keep looking and hoping for more. Why? I think it may be because they have become hooked on the monetary morphine we provided when we performed massive reconstructive surgery, rescuing the economy from the Financial Panic of 2008–09, and then kept the medication in the financial bloodstream to ensure recovery....I believe adding to the accommodative doses we have applied rather than beginning to wean the patient might be the equivalent of medical malpractice." So let's get this straight: these academic titans, who for one reason or another, are given free rein to determine the fate of the once free world with their secret decisions every two or three months, are completely unaware of classical conditioning, discovered by Pavlov nearly 90 years ago, also known as a salivation response. The same Fed is shocked, shocked, that every time the market dips, the red light goes off, and the "balls to the wall" crowd scream for more, more, more free money. Really Fisher? Really? Oh, and let us guess what happens the next time the S&P slides into the tripple digits: will the Fed a) do nothing, thereby letting the market slide to its fair value in the 400 point range, or b) print. Our money, in the form of hard yellow metal, is on the latter, just like we predicted, correctly, back in March 2009 in " Bailoutspotting (Or The Search For The Great Financial Methadone Clinic)" that nothing will ever change vis-a-vis the great market junkie until it all comes crashing down.

From the Dallas Fed

“Not to Be Used Externally, but Also Harmful if Swallowed”: Projecting the Future of the Economy and Lessons Learned from Texas and Mexico

Remarks before the Dallas Regional Chamber of Commerce
Dallas, Texas
March 5, 2012


I have been asked to speak about the economy. I am going to take a different approach than is typical for a Federal Reserve speech. I’ll eschew making the prototypical forecast, except to note that from my perch at the Federal Reserve Bank of Dallas, I presently see that: a.) On balance, the data indicate improving growth and prospects for job creation in 2012. However, the outlook is hardly “robust” and remains constrained by the fiscal and regulatory misfeasance of Congress and the executive branch and is subject to a now well-known, and likely well-discounted, list of possible exogenous shocks—the so-called “tail risks”—posed by possible developments of different sorts in the Middle East, Europe, China and elsewhere. And b.) While price stability is being challenged by the recent run-up in gasoline prices—which has yet to be reflected in the personal consumption expenditure and consumer price indexes but may well make for worrisome headlines when February data are released—the underlying trend has been converging toward the 2 percent long-term goal formally adopted by the Federal Open Market Committee (FOMC) at its last meeting.[1]

As to the outlook envisioned by the entire FOMC, you might wish to consult the forecasts of all 17 members, which include those of yours truly, that were made public after the January meeting—though I think a puckish footnote appended to the internal document laying out a component of the December 1966 FOMC forecast might still apply: “Not to be used externally, but also harmful if swallowed.”[2]

Speaking of harmful if swallowed, I might add that I am personally perplexed by the continued preoccupation, bordering upon fetish, that Wall Street exhibits regarding the potential for further monetary accommodation—the so-called QE3, or third round of quantitative easing. The Federal Reserve has over $1.6 trillion of U.S. Treasury securities and almost $848 billion in mortgage-backed securities on its balance sheet. When we purchased those securities, we injected money into the system. Most of that money and more has accumulated on the sidelines: More than $1.5 trillion in excess reserves sit on deposit at the 12 Federal Reserve banks, including the Dallas Fed, for which we pay private banks a measly 25 basis points in interest. A copious amount is being harbored by nondepository financial institutions, and another $2 trillion is sitting in the cash coffers of nonfinancial businesses.

Trillions of dollars are lying fallow, not being employed in the real economy. Yet financial market operators keep looking and hoping for more. Why? I think it may be because they have become hooked on the monetary morphine we provided when we performed massive reconstructive surgery, rescuing the economy from the Financial Panic of 2008–09, and then kept the medication in the financial bloodstream to ensure recovery. I personally see no need to administer additional doses unless the patient goes into postoperative decline. I would suggest to you that, if the data continue to improve, however gradually, the markets should begin preparing themselves for the good Dr. Fed to wean them from their dependency rather than administer further dosage.

I am well aware of the salutary effect of accommodative monetary policy on the equity and fixed-income markets—remember, I am the only member of the FOMC who used to be on the other side. My firms’ record of substantially outperforming the equity and fixed-income indexes over a prolonged period before I hung up my investment business and entered public service in 1997 was achieved by focusing on the long-term fundamentals of the real economy and the underlying value of the securities we purchased or sold—not by depending on central bank largesse. Counting on the Fed to perpetually float returns is a mug’s game.

From my present perspective on the side of the angels, as a member of the policymaking team on the FOMC, I believe adding to the accommodative doses we have applied rather than beginning to wean the patient might be the equivalent of medical malpractice. Having never before pursued this course of healing, we run the risk of painting ourselves further into a corner from which we do not know the costs of exiting. It is my opinion that we should run that risk only in the most dire of circumstances, and I presently do not see those circumstances obtaining.

So much for forecasting and monetary policy. Let me now walk you through an overview of the Texas economy to set the stage for a broader discussion of what I believe continues to bedevil a lasting recovery and more efficient job creation in the United States.

I will use some slides to illustrate key points.

The National Bureau of Economic Research, the arbiter of when recessions begin and end, dates the onset of the Great Recession as December 2007. The economic performance of Texas since December 2007 can be summarized with the chart projected on the screen. It depicts employment growth in the 12 Federal Reserve districts. In the Eleventh Federal Reserve District?or the Dallas Fed’s district—96 percent of economic production comes from the 25.7 million people of Texas. As you can see by the red line, we now have more people at work than we had before we felt the effects of the Great Recession. All told in 2011, Texas alone created 212,000 jobs.[3]

Chart 1

Only two other states can claim they surpassed previous peak employment levels: Alaska and North Dakota.

Readers of this speech abroad?say, in Washington or New York?might think our growth last year came only from the burgeoning oil and gas patch. They would be right to describe it as burgeoning: 30,000 jobs were added in oil and gas and the related support sector last year. Texas now produces 2.1 million barrels of oil per day, the same amount as Norway; we produce 6.7 trillion cubic feet of natural gas a year, only slightly less than Canada.[4]

With 25 percent of U.S. refinery capacity and 60 percent of the nation’s petrochemical production located in Texas, we most definitely benefit from both upstream and downstream energy production.

And yet other sectors gained more jobs than the oil and gas sector and its support functions in 2011: 58,000 jobs were added in professional and business services, nearly 46,000 in education and health services and more than 41,000 in leisure and hospitality. Manufacturing?which accounts for approximately 8 percent of total Texas employment?added over 27,000 jobs.

All told, the private sector in Texas expanded by 266,400 jobs in 2011, while the public sector contracted by 54,800, due primarily to layoffs of schoolteachers. In sum, Texas payrolls grew 2 percent, significantly above the national rate of 1.3 percent.

This performance is not unique to last year. As you can see from this graph of nonagricultural employment growth by Federal Reserve district going back to January 1990, the Eleventh District has outperformed the nation on the job front for over two decades. Note the slope of the top line, which depicts job growth in the Eleventh District compared with each of the other districts and, importantly, relative to employment growth for the U.S. as a whole?denoted by the black line, the seventh one down.

Chart 2

As was pointed out in high relief by the media when a certain Texas governor was briefly in the hunt for his party’s presidential nomination, we do have some serious deficiencies in the Lone Star State. We have a very large number of people earning minimum wage; we have an unemployment rate that, while trending downward, is still too high, abetted by continued inflows of job seekers from less-promising sections of the country. But I’ll bet you that those who constantly enumerate our deficiencies and are given to habitual Texas-bashing would give their right—or should I say, left—arms to have Texas’ record of robust long-term job creation instead of the anemic employment growth of other megastates such as California and New York. Or even the job formation record of many other countries! The following chart shows that over the past two decades, the rate of employment growth in Texas has exceeded that of the euro zone and its two anchors, Germany and France, as well as that of two natural-resource-intensive countries with populations comparable to Texas’, Canada and Australia.

Chart 3

Now, is all this just prototypical Texas brag, or are there lessons the nation can learn from the success that is enjoyed here? Texans are hardly given to modesty, but I believe there are some undeniable lessons being imparted here.

One lesson I draw from comparative state data is that monetary policy is a necessary but insufficient tonic for economic recovery. The Fed has made money cheap and abundant for the entire country. The citizens of Texas and the Eleventh Federal Reserve District operate under the same monetary policy as do our fellow Americans. We have the same mortgage rates and pay the same rates of interest on commercial and consumer loans, and our businesses borrow at the same interest rates as their brethren elsewhere in the country. Which raises an important question: If monetary policy is the same here as everywhere else in the United States, why does Texas outperform the other states?

The answer is no doubt complicated by the fact that Texas is blessed with a comparatively great amount of nature’s gifts, a high concentration of military installations and what some claim are other “unfair” advantages.

But many of these “unfair” advantages are man-made: They derive from a deliberate approach by state and local authorities to enact business-friendly regulations and fiscal policy. For example, if you examine the differences between Texas and two states that have been underperforming for a prolonged period—California and New York—you will note that these former power states have less-flexible labor rules. Due to local taxes, differences in zoning practices and myriad other factors, the cost of housing and the overall cost of living in California and New York are significantly higher than they are here. And due to differences in policies governing education, the scores measuring middle-school students’ proficiency in math are lower in both California and New York than they are in Texas, and in reading, are lower in California and only slightly higher in New York.[5]

Taken together, these factors, alongside whatever natural advantages we may enjoy (though it is hard to compete with the physical beauty of California and the Great Lakes region or the cultural splendor of New York), affect where firms choose to locate and hire and where people choose to raise their families and seek jobs.

I would argue that an additional factor favors Texas: We have a Legislature that under both Democratic and Republican governors has over time deliberately crafted laws and regulations, and tax and spending regimes, encouraging business formation and job creation.

Just last month, Fairfield, Calif.-based vehicle reseller Copart Inc. announced that it will move its headquarters to Texas, citing “greater operational efficiencies.”[6] The CEO for the owner of Hardee’s and Carl’s Jr. restaurants, Andy Puzder, claims it takes six months to two years to secure permits in California to build a new Carl’s Jr., whereas in Texas, it takes six weeks. These two anecdotes from California alone clearly illustrate that firms and jobs will go to where it is easiest to do business—not where it is less convenient and more costly.

Both state and federal authorities need to bear this in mind as they plot changes in the fiscal and regulatory policy needed to restore the job-creating engine of America. As an official of the Federal Reserve charged with making monetary policy for the country as a whole, I am constantly mindful that investment and job-creating capital is free to roam not only within the United States, but to any place on earth where it will earn the best risk-adjusted return. If other countries with stable governments offer more attractive tax and regulatory environments, capital that would otherwise go to creating jobs in the U.S.A. will migrate abroad, just as intra-U.S. investment is migrating to Texas.

Thus, even if one were to somehow have 100 percent certainty about the future course of Federal Reserve policy and be completely comfortable with it, without greater clarity about the future course of fiscal and regulatory policy and whether that policy will be competitive in a globalized world, job-creating investment in the U.S. will remain restrained and our great economic potential will remain unrealized.

I pull no punches here: We have been thrown way off course by congresses populated by generations of Democrats and Republicans who failed the nation by not budgeting ways to cover the costs of their munificent spending with adequate revenue streams. The thrust of the political debate is now—and must continue to be—how to right the listing fiscal ship and put it back on a course that encourages job formation and gets the economy steaming again toward ever-greater prosperity. No amount of monetary accommodation can substitute for the need for responsible hands to take ahold of the fiscal helm. Indeed, if we at the Fed were to abandon our wits and seek to do so by inflating away the debts and unfunded liabilities of Congress, we would only become accomplices to scuttling the economy.

I was in Mexico last week. Mexico has many problems, not the least of which is declining oil production, low school graduation rates and drug-induced violence. But on the fiscal front, the country is outperforming the United States. Mexico’s government has developed and implemented better macroeconomic policy than has the U.S. government.

Mexico’s economy contracted sharply during the global downturn, with real gross domestic product (GDP) plummeting 6.2 percent in 2009. But growth roared back, up 5.5 percent in 2010 and 3.9 percent in 2011, with output reaching its prerecession peak after 12 quarters—three quarters sooner than in the U.S. Mexico’s industrial production passed its prerecession peak at the end of 2010; ours has yet to do so.

Now hold on to your seats: Mexico actually has a federal budget! We haven’t had one for almost three years. Furthermore, the Mexican Congress has imposed a balanced-budget rule and the discipline to go with it, so that even with the deviation from balance allowed under emergencies, Mexico ran a budget deficit of only 2.5 percent in 2011, compared with 8.7 percent in the U.S. Mexico’s national debt totals 27 percent of GDP; in the U.S., the debt-to-GDP ratio computed on a comparable basis was 99 percent in 2011 and is projected to be 106 percent in 2012. Imagine that: The country that many Americans look down upon and consider “undeveloped” is now more fiscally responsible and is growing faster than the United States. What does that say about the fiscal rectitude of the U.S. Congress?

Here is the point: As demonstrated by the relative and continued, inexorable outperformance by Texas—which is affected by the same monetary policy as are all of the other 49 states—the key to harnessing the monetary accommodation provided by the Fed lies in the hands of our fiscal and regulatory authorities, the Congress working with the executive branch. As demonstrated by the fiscal posture of Mexico, a nation can effect budgetary discipline and still have growth.

One might draw two lessons here.

The first comes from Germany’s finance minister, Wolfgang Schäuble, who from my perspective was spot on when he said, “If you want more private demand, you have to take people’s angst away” by having responsible and disciplined fiscal and regulatory policy.[7] Clearly, there is less angst involved in conducting business in Texas.

The second is a broader, macroeconomic truism: that fiscal and regulatory policy either complements monetary policy or retards its utility as a propellant for job creation. Mexico is proof positive that good fiscal policy enhances the effectiveness of thoughtfully conducted monetary policy, which is what the Banco de México—whose independence, incidentally, was enshrined by a constitutional amendment in 1994—has delivered under its single mandate of inflation control and by applying the tool of inflation targeting.

I should be injecting some levity into the event, though it is hard to do so when one talks about our feckless fiscal authorities. But there are witty people who have found a way to do so. Take a look at this parody of Congress that my staff found on YouTube: www.youtube.com/watch?v=Li0no7O9zmE.

There you have the prevailing modus operandi of our fiscal authorities: pass the bill rather than the American dream to our children. What a sad tale!

You asked me to talk about the economy. In a nutshell, my answer is this: Monetary policy provides the fuel for the economic engine that is the United States. We have filled the gas tank and then some. And yet businesses will not use that fuel to a degree necessary to realize our job-creating potential and create a better world for the successor generation of Americans until Congress, working with the executive branch, does the responsible thing and pulls together a tax, spending and regulatory program that will induce businesses to step on the accelerator and engage the transmission mechanism of job creation so they and the consumers they create through employment can drive our economy forward.

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Death and Gravity's picture

Judging from some other Texas stat, the job growth will be in the liposuction sector...

redpill's picture

I'm rather weary of all this talk of "bubbles" - as if this economy is a pretty balloon at a child's birthday party, or a squeaky clean soap bubble waiting to be popped to a glee of young giggles.  Nonsense.  This isn't a bubble.  It's a festering, puss-filled boil desperately searching for a hot lance so that a half-century of fiat-fueled neo-Keynesianism can vomit out like the half-digested Kintner boy spilling out onto the dock from the belly of that shark.

trav7777's picture

Fisher is nuts. This is the problem with economists. Yeah, whoopdie shit there is all this money laying around....wtf is there to DO with it?

If Fisher had a brain, he'd realize why his bank can't charge more than .25% interest.

WTF would you do to "develop" the US?  At a profit, of course.  Name something.  We've already got a bazillion roads, buildings, all of that shit.  I can't think of much that will turn a profit reliably.  Labor is too expensive, taxes are too high, regulation is too costly.

WTF u gonna do, drill holes and hope oil pops out?  US interest rate regimes (and Japanese) are a study in saturation and depletion.  You get an exhausted horse, an exhausted well, an exhausted field, you can't fkin stimulate it anymore. 

The economists believe that because their world has no limits that the real world must not either.

Pladizow's picture

"We hang the petty thieves and appoint the great ones to office" - Asop

Why did god create economists?

      - to make weather men look good!

nope-1004's picture

Well said RP.  And I agree with Trav too..... the "economic models" are based on limitless growth.  Only problem is we live in a finite world.  At some point (now!), the system needs to be revamped.


centerline's picture

This makes the assumption that these numnuts believe their own bullshit.  I am not quite so sure of that.  These are really smart people.  Maybe blinded by ego.  Maybe not.  If not, this is nothing more than a very well crafted piece of work meant to fit into a bigger picture of swaying opinion and affecting some sort of change.  Maybe setting the stage for blame to come, or sowing the seeds of a planned CB implosion at the hands of stooge politicians.

Benjamin Glutton's picture

On a long enough crime line the value of all currencies reduces to nooses....

redpill's picture

If they were going to insist on blowing trillions of dollars, at the very least what they could have done is spend it on commercialized fusion that would actually help the energy situation, but instead it's going to take another 3 decades because it is moping along trying to get over massive barriers to entry every step of the way, and that's assuming there weren't energy competitors trying to prevent it from coming to market in an efficient way (which of course there are).

eatthebanksters's picture

trav, there are plenty of small businessmen, like me, that had 800+ credit scores until credit was taken away from us and we scrambled to save what equity we had in a quickly declining economy.  Small businesses historically are the greatest innovators and largest producers of job growth.  Like many other small business people, without access to credit, I'm dead in the water. And by merely denying credit to many smart people, as their businesses fail, so do their credit ratings, further damaging any prospect of obtaining credit.

Instead of pumping trillions into huge insolvent and failing institutions, I think the Fed would have been wiser to create credit for the millons of little guys on Main Street who would create profitable buisnesses.  Instead of sucking the world dry and asking for more QE perhaps there would be real productivity which could start growth in our economy.  It would not be worse than what we have right now.  

In a nutshell, our banking system has failed. Banks used to provide a safe place to put your money and lent money to people.  Now banks have become casinos with other peoples money and mostly loan to large corporations.  Banks used to be profitable working with small spreads and didn't need to create 30+% returns on originations, derivatives and fees to stay in business.  

I fear the pols and bankers have been arguing that they are doing what they are doing to support the engine of growth in our country, but growth is only good if the majority benefit from it, and clearly that is not currently what is happening.  It's time for major reform an change.


Bobbyrib's picture

I remember thinking they should have expanded the SBA and let more money, but people didn't like the idea and labeled it freaked out that it "socialism." It would have done more to help the economy than watching the Fed loan to banks.

sun tzu's picture

I don't believe that idea was ever considered. Besides, the loans should have come from banks, not the taxpayers. Don't the taxpayers have enough bad loans on their books from mortgages and student loans?

ihedgemyhedges's picture

Fisher owns a lot of GLD.  TD posted that about a month ago or so.  Bet you he owns some nice Texas acreage as well.....

He's hedged against whatever......................

cranky-old-geezer's picture



What makes you think financial people care about the economy? 

They obviously don't.   They've done nothing to fix problems in the economy. 

Borrowing and spending is the new economy in America, and the Fed is the source of all that borrowed money, by printing money, which slowly debases the currency (as Bernanke himself said in 2002).

So America is heading for currency collapse.  Nobody knows exactly when, because Fed has no control over sudden loss of confidence in the currency.

RSloane's picture

I wish I could give a +20 to that post. As it is, thanks for putting so articulately what so many of us think.

Catullus's picture

Turns out "festering, puss-filled boil[s] desperately searching for a hot lance so that a half-century of fiat-fueled neo-Keynesianism can vomit out like the half-digested Kintner boy spilling out onto the dock from the belly of that shark" are bullish for AAPL.

alien-IQ's picture

rarely have I seen so many grotesque images conspire to construct such a lucid thought.

well played.

Unprepared's picture

Euthanasia ... Euthanasia

stocktivity's picture

So this Fed official screwball fisher is "SHOCKED" that the markets are addicted to the free money. Wasn't Benny, the Fed Chairman sending Tiny Timmy G over to Europe every other week last fall to plead with them to start printing money like we are to jack up their system? Europe spanked Tiny Timmy and sent him hom telling him to mind his own business and get his own house in order. So ...what exactly did Europe end up doing? Why they started the printing presses ....just what Benny asked for. Now I ask....who is the most powerful man on this planet? And to think...Fisher is just "SHOCKED" that the markets have become addicted to the printing.

Jake88's picture

Yeah shocked and so suddenly.

Cadavre's picture

Commonsense in the Loan Star State has finally realized price is a function of counterfeiting and ain't got nothing to do with the value (or valuelessness) of the underlying.

Texans don't need the other "lower" 47. But the lower 47 do need Texas. The only reason you be warm in Chicago Tonight is rail car fuel oil coming from Texas.

Besidesthe Texas border represents a "Texas Sized" shit load of drug, weapons and money laundering business for the DEA, DoJ and NYC Primaries, not to forget the drone and border security "sham wow" sales for the Chertoff Group and DHS.

Lot's of snakes, jack-o-lopes, Cessna-sized-squitos, and them fat tailed scorpions complimented by melt you dead summertime climate and poker faced playing dumb cowboys that can skin a carpet bagger's hide 'fore he put a dollar in the Titty Bar Dancer's waist band.

Strange that Dallas, referred to as "CUFI Central" by the rest of the state, is badmouthing The Protocols of the Talmudic Usury". Something up?

"Trillions of dollars are lying fallow, not being employed in the real economy. Yet financial market operators keep looking and hoping for more. Why?

Why are fiat hoarders begging the print?

Easy - somewhere in their overconfidence of the Titanic's double hull technology, they really believe that "when" US monetary policy moves from the current "full faith and credit" fairytale to a "physical" standard, they will be able to convert to a lions share of the physical because they got the biggest piles of counterfeits. Bunches more by orders than the schleps on W2s.

The world of the Money Center Tug Job Fantasies desperately clings to a hope that their little world will still be orbiting the sun when the conversion to physical is executed. The "little world" will still be there. But all it be then is a "lump of fresh shat dung".

Bobbyrib's picture

Texans need to get over their state. Saying Texas doesn't need the other lower 47 states is like saying Germany doesn't need the rest of Europe. Even if Texas was independent they would need to export their products to someone. Being that the US has more capital and a more stable political atmosphere than your neighbors to the south, naturally the products come north to the other lower 47. 

Cadavre's picture

The way you see it could be reality. An alternative position regarding EZ interdependency would argue Germany doesn't need the EZ, instead, asserts it is the EZ that needs Germany. Germany is one of "the", if not "the", largest exporting nations on the planet. Beats the export shit out of the US. German manufacturing stats, unlike the US pig in a poke stats, exclude jobs like fast food concessions and beer parlors and Taco Bell Taco Jockeys from its manufacturing count The US manufactures dollar bills, debt and omega 6 fatty acid laced soylent green monkey bars for exports to US suburban drive through feeding lots.

being the US has more capital ...

A cigar is in order! Your are absolutely correcto-mundo on that: Printing capital is our our largest industry! We beat the rest of the world in that particular manufacturing sector. It ain't no wonder we got more capital!

Freegolder's picture

I recall Fisher was often opposed to QE whilst a voting Fed member?

It is harsh of ZH to criticise someone for voicing more concerns about Fed policy, when ZH criticises the same policies every day. Fisher has been consistent in his opposition.

Mr Fisher needs our support, if the Fed had a few more like him I'd bet we'd never see another round of QE.

Worthy news for us readers, but could have been presented in a fairer manner, rather than a bitter attack.



Stax Edwards's picture


Glad to see I am not alone in my thinking.  He actually exhibits sanity, logic and reason.  Something the FED desperately needs more of.

Cadavre's picture

Don't think it's Fisher's record as it is the fact he has stated the obvious but refuses to even offer a hint as to why the hoarders are hoarding.

The fiat hoarding is a "result". As smart as Fisher is you got to know he has a pretty good hunch as to why - he knows it's a setup - but ain't found that inner strength or ethics to go public.

He knows QE is market manipulation and an extortion to transfer value from the commons to the banks.  He knows it's price rigging and he hasn't found the ethic or courage or proper moral turpitude to say it outright.

What he said is already known. The crime is "why" its being done and he won't go on the record with the answer.

SeverinSlade's picture

What?  Hopium is just as addictive as crack cocaine?  Really?  Who'd have known?

The trend is your friend's picture

All this QE is, is a MORPHINE DRIP.  When the patient is dying in the ER or ICU and nothing can be done, all you can do is a morphine drip to ease the pain a little while longer until the patient flatlines

MsCreant's picture


Or they foam the runway (QE) when they know the plane is going to crash. Maybe a few will survive, but it's going to be bad.

resurger's picture

You are wrong Sir,

Because Dr. Ben Bernanke is a great psychologist who understands Hopium Withdrawal Symptoms (HWS) if you may ehm, more than anybody else on ZH! His assistant is Dr. Paul Krugman, he also has experience in the treatment of the same condition.

The HWS condition can be treated by injecting a massive amount of QE in the junkies accounts.

Dr. Paul said that even if you are dead, you have to come "back to life" and buy Technology, like AAPL!!!!!!!!!!!

you say how?

i think you are underestimating the QE-injections


Jason T's picture

Job growth..yes, but what about pay?

As of December 2011, New York had regained 154,300 of the 333,400 jobs that were lost in the recession. New York ranked 16th among the 50 states in jobs regained, performing well-above the national average of 34 percent. Job growth in New York, however, was weak in the second half of 2011, with the state losing 11,200 private sector jobs since July. In addition, the average salaries of the jobs created in the past two years is more than 40 percent lower than the average salaries of the jobs lost during the recession.


Bobbyrib's picture

Watching the financial bubble in NY complete its collapse should be a relief to the rest of the country. Banker pay and bonuses decreasing should be seen as a good thing. Now the country can try to produce products with value.

Another tech bubble would be better than another financial bubble. At least watching people create software or hardware businesses could use to increase productivity would be better in the end. Which bubble collapse do we currently get more out of: the 90's technology bubble, or the 21st (edit) *century* financial bubble?

NY seems to be a place where software start ups happen. Software companies could start up anywhere, but the kind of people who work in software development usually prefer more urban environments like CA, or NY. I'm not knocking Texas, I'm just saying different parts of the country will have different "advantages" creating jobs.

It is a bargin my friend's picture

Its still just a tad worrying that Dr Frankenstein still  cannot see the monster and is scoulding it for his own mistakes.

BoNeSxxx's picture


irony: read it, learn it, live it  (bitchez)

Aunty Christ's picture

Dick Fisher acts like a lion, but votes like a pussy cat. Another stuffed shirt who doesn't have the balls to defy the Chairsatan

trav7777's picture

what...you act like his bank has takers for credit at more than .25%?  He doesn't.

He can only talk...the economists have no fucking clue.  Fisher thinks, what, that productivity and profitability will return if they raise rates? There's nothing the fuck to do in the US anymore that will generate growth.  The climate is saturated and depleted.

This HAPPENS.  Fuckin watch Gold Rush...the "Big Nugget" mine has produced on that show for years and years and now the gold is all depleted.  So...Parker's gonna do what, expend mountains of capital to move mountains of dirt to try to eke out some more?  NO amount of additional credit can make shit that is nonprofitable turn into something profitable.

The US's oil wells, mines, soil, all of it is functionally depleted to the point that it no longer can profitably return.  We are tapped out.

Mr Lennon Hendrix's picture

Third Rule....the fight is over.

riphowardkatz's picture

Your argument makes sense until you watch the show that follows where they are mining for gold in the ocean. There are worlds and worlds out there of unexplored untapped resources. We are far from tapped out. Just look at Wyoming in the last 5 years and that is one of many examples.

Your main point that money does not create wealth is spot on. Productive people create wealth. As long as their wealth is taken and redistributed to non productive bankers. welfare recipients and unhealthy medicare gobbling boomers we will soon run out of the most valuable asset this country has, the wealth producer.

Random_Robert's picture

Atlas, bitchez- shrugging like a mo-fo.

BTW I love your ZH handle... Katz was awesome. I miss reading his wisdom.


ziggy59's picture

It's the same story retold ...goldilocks and the 3 bearshits. . All FED members have selective amnesia when convenient. Green spam forgets he was the original monster bubble blower. Now the current scum bucketeers will also defer blame and won't believe the system collapsing is because of them.

q99x2's picture

Donate him to Obama's campaign. NDAA the f'r.

rufusbird's picture


Slip the juce to me Brucie...

Tooling down the hightway doing 79
I'm a twin pipe papa and I'm feelin fine
Hey man dig that was that a red stop sign
(Scrreeech-BANG, tinkle)
Transfusion, transfusion
I'm just a solid mess of contusions
Never, never, never gonna speed again
Slip the blood to me, Bud

I jump in my rod about a quarter to nine
I gotta make a date with that chick of mine
I cross the center line man you gotta make time-
(Scrreeech-BANG, tinkle)
Transfusion, transfusion
Oh, man, I got the cotton pickin convolutions
Never, never, never gonna speed again
Shoot the juice to me, Bruce

My foot's on the throttle and it's made of lead
But I'm a fast ridding daddy with a real cool head
I'ma gonna pass a truck on the hill ahead-
(Scrreeech-BANG, tinkle)
Transfusion, transfusion
My red corpsuckles (sic) are in mass confusion
Never, never, never gonna speed again
Pass the crimson to me, Jimson

I took a little drink and I'm feelin right
I can fly right over everything everything in sight
There's a slow poking cat I'm gonna pass him on the right
(Scrreeech-BANG, tinkle)
Transfusion, transfusion
I'm a real gone paleface and that's no illusion
I'ma never never never gonna speed again
Pass the claret to me, Barrett

A rollin down the mountain on a rainy day
Oh, when you see me coming better start to pray
I'm a cuttin' up the road and I'm the boss all the way
(Scrreeech-BANG, tinkle)
Transfusion, transfusion
Oh, doc, pardon me for this crazy intrusion
I'm never, never, never gonna speed again
Pump the fluid in me, Louie

I'm burning up the highway early this morn
I'm passing everybody oh nothing but corn
Man outa my way I don't drive with my horn
(Scrreeech-BANG, tinkle)
Transfusion, transfusion
Oh, nurse I'm gonna make a new resolution
I'm never, never, never gonna speed again
Put a gallon in me, Alan

Oh, barnyard drivers are found in two classes
Line crowding hogs and speeding jackasses
So rememmber to slow down today
Hey, daddy-o
A make that type O, huh
(Scrreeech-BANG, tinkle)

Hedgetard55's picture

If easy money created the problem, even easier money will solve it. If you can't grasp that, then you are no Ben Bernanke. Remeber Ben's thesis, that FED tightening caused the GD.

trav7777's picture

until they can print oil, money doesn't matter.

The crux of what the Fed was hoping would happen is that in the face of TOTAL lack of demand for credit to go do new things (growth) that if they lowered the price of it, shit would happen.

Maybe people would go drill wells previously unprofitable and growth could resume at a lower ROI.  It hasn't.  We're at zero percent.  There's nowhere to go from here.

The system is trying to delever but such a thing causes apocalyptic crash of the monetary system.  The liquidity trap isn't even acknowledged as possible by most schools of economics.

Because MONEY can grow to infinity, they assumed that real world activities and production/consumption could also grow to infinity.  If you are locked inside a safe and can print enough money, you can cause a sandwich to appear.

Sufficient demand will *always* cause more supply to appear.  This is precisely how their stupid theories conceive of the world.

Hedgetard55's picture



     Certainly that was their cover story, but the real goal was merely to bail out their bankster masters and transfer the cost to the tax payers/holders of dollars and cash equivalents through a debased currency.

MsCreant's picture

Would you shit a brick if someone actually said all this stuff in the politcal arena? We know they won't, don't worry. 

You are, of course, dead on right. I cheer your posts on this thread.

So will you move to Africa, where the resources are not yet depleted? 

alexwest's picture

# Not to Be Used Externally, but Also Harmful if Swallowed

is it me or this looks like some kind of Freudian Equivalent to
'dick sucking'

just a thought