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When One Hilsenrath Is Just Not Enough, Here's Another: "Bernanke Signals Readiness To Do More"

Tyler Durden's picture


In the immortal words of the Jackson 5: "I'll Be There" seems to be the meme du jour - which appears to us to be the same message that Bernanke (and his proxy Hilsenrath) have been on for a few years now. However, in case you hadn't had enough sycophantic central-bank-fellating 'hope', the WSJ's front-man just reiterated for one and all that Ben's our man. In our subtle opinion, it seems however that perhaps Bernanke was a little disingenuous with his talk of 'policy tool effectiveness' - as clearly his efforts have not had the desired economic effect so far (or he would not need to reiterate the ability to do more of the same).

Jon Hilsenrath, WSJ: Bernanke Signals Readiness to Do More

Federal Reserve Chairman Ben Bernanke offered a robust defense of the effectiveness of the central bank's easy-money policies in his Friday speech at the Fed conference in Jackson Hole, Wyo., and left little doubt that he is looking toward doing more to give the economy a lift at the Fed's next policy meeting in September.

On The Economy [ZH - clearly helping the "it's still dismal out there" meme - let's hope it doesn't get better anytime soon, or he will really have to show how bad we are]:

Some market participants have been wondering if a run of moderately better economic data of late has changed the Fed's thinking about the economy. Mr. Bernanke left little doubt that he is still deeply dissatisfied with the outlook, describing the economic situation as "far from satisfactory."


[It's Cyclical Stupid]
Importantly, the Fed chairman also says that the job market's weakness, to date at least, is the result of cyclical problems in the economy (that is, a lack of demand) and not structural problems (such as a mismatch between the skills people have and the skills employers are looking for.)


[which means we are justified in our 'extreme' actions]
The Fed feels it can help address cyclical problems, but not structural problems. In other words, this is a problem where the Fed feels it can help. Of course, he also includes his "no panacea" caveat; Mr. Bernanke would love fiscal policy makers to take actions to support the economy and address long-run deficits. But he doesn't seem to see that as justification for inaction on his front.

[and the disingenuous comments begin... jobs, here's your jobs - what are you all complaining about?]
COSTS AND BENEFITS: Mr. Bernanke has said repeatedly that the Fed's decisions about how to use monetary policy depends on an analysis of the costs and benefits of different actions. His analysis, particularly of the Fed's controversial bond-buying programs, heavily emphasizes the benefits and plays down the costs. Two rounds of bond buying have raised overall economic output by 3%, he said, and increased payroll employment by 2 million jobs, he said his staff has estimated.

"A balanced reading of the evidence supports the conclusion that central bank securities purchases have provided meaningful support to the economic recovery while mitigating deflationary risks,"


[and finally - they have it all under control, so don't worry]

"The costs of nontraditional policies, when considered carefully, appear manageable, implying that we should not rule out further use of such policies if economic conditions warrant,"

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Fri, 08/31/2012 - 11:03 | 2752713 Xibalba
Xibalba's picture

Like an old man who can't get it up..."I promise I'll be ready next time"

Fri, 08/31/2012 - 11:08 | 2752736 Brazillionaire
Brazillionaire's picture

Old men don't need Viagra because they can't get it up. They need Viagra because old women are ugly.

Fri, 08/31/2012 - 11:12 | 2752757 MillionDollarBonus_
MillionDollarBonus_'s picture

The 10 year yield is down on the day at 1.59%. The treasury market is showing incredible resilience. My year-end target for the 10 year is 1.00%. Bernanke doesn't need to introduce more Quantitative Easing with such a robust treasury market. I would howeversuggest monetization of other assets such as mortgage backed securities or equities. 

Fri, 08/31/2012 - 11:21 | 2752785 NotApplicable
NotApplicable's picture

Sure the problem is cyclical, in a kind of Fourth Turning or Kondratieff Wave sort of way.

Fri, 08/31/2012 - 11:44 | 2752869 Manthong
Manthong's picture

Good for cyclical, not structural problems?

Well Ben, maybe freshened blood works for the first half dozen races, but folks are likely to catch on eventually. 

Fri, 08/31/2012 - 11:29 | 2752814 Xibalba
Xibalba's picture

Why not just let the market work?  Is that a revolutionary idea or something?  

Fri, 08/31/2012 - 11:31 | 2752820 john39
john39's picture

that would expose the prasites...  verboten.

Fri, 08/31/2012 - 11:33 | 2752829 BeetleBailey
BeetleBailey's picture

Gee...what's your year end target on FuckBukakke....and don't go dumb and ask "what is that?"...you know what it is putz...

"Robust" treasury market......man you are a hoot...

Fri, 08/31/2012 - 11:34 | 2752831 earnyermoney
earnyermoney's picture

I'll bet you're hoping they monetize your Facebook shares. LOL

Fri, 08/31/2012 - 11:08 | 2752738 vast-dom
vast-dom's picture


Fri, 08/31/2012 - 11:18 | 2752775 trebuchet
trebuchet's picture

you can say what you like. 


" it is important to achieve further progress, particularly in the labor market. Taking due account of the uncertainties and limits of its policy tools, the Federal Reserve will provide additional policy accommodation as needed to promote a stronger economic recovery and sustained improvement in labor market conditions in a context of price stability."

In Bens words, which bit of this says "we are done?" This says to me " we waited for recovery to pick up and now its time to act". 


I said it here in previous threads last week this speech will be about the unemployment rate, the need to reduce it  and positioned accordingly.

The speech, outlining effectiveness of unconventional monetary tools was saying "it works" so we have to power to do more, dont doubt us


This is a "dont short  the euro" speech.... 


Time for ZH to bring out the comparison of the Euroland/US CB balance sheet growth charts to see where we could be going...



Fri, 08/31/2012 - 11:19 | 2752778 LawsofPhysics
LawsofPhysics's picture

That and total debt outstanding for the EZ.

Fri, 08/31/2012 - 11:25 | 2752800 vast-dom
vast-dom's picture

the fed has 6% target unemployment that they could theoretically influence -- we are realistically at over 15% and officially at over 8%. more importantly, QE can't won't and could never improve unemployment just like ZIRP can't do more than punish savers, old people etc. most importantly, a free market can't return to cyclical normalcy with this illegal anti-market QE/NIRP bullshit. Let's have a crash precisely because of QE.

Fri, 08/31/2012 - 11:31 | 2752819 trebuchet
trebuchet's picture

with five years work , the ben and fomc are not goign to let the juggernaut slip over the cliff without a fight. 

I wouldn't hold my breath waiting. 

in their opinion they added 2 m jobs. scale up to work out how much action it will take to get from 8% to 6%. They won't go all the way, they intend to go some of the way


im still trying to work out what lever the want to pull to do that... as they said they do the Cost benefit thing... 


work that one out and you front run the fed ahead of the pack ... until goldman/thebots jumps in and front runs the front runners.. weekend homework



Fri, 08/31/2012 - 11:36 | 2752837 vast-dom
vast-dom's picture

your homework will be no more scientific than taking a coin and flipping it over and over until you get tired enough to delude yourself into thinking you can second guess which fucked up innefectual tool will be paraded around for the bankers to extract more free money and the indexes to bloat up on nothing.

Fri, 08/31/2012 - 12:29 | 2753045 Freddie
Freddie's picture

Jackson 5 - because if Obama had a son - he probably would like like Tito, Jermaine (with more Jeri-Curl), honor student Trayvon and pretty much any muslim dude.

Fri, 08/31/2012 - 11:03 | 2752714 SHEEPFUKKER

Shocker, more than one A-hole in J-Hole.

Fri, 08/31/2012 - 11:05 | 2752723 kito
kito's picture

the stupidity of the professional investing community never ceases to amaze me............

Fri, 08/31/2012 - 11:22 | 2752789 NotApplicable
NotApplicable's picture

Which bot are you referring to?

Fri, 08/31/2012 - 11:27 | 2752803 trebuchet
trebuchet's picture

Low vols of last few weeks??


The Knight bot makers recalled their other models for maintenance :))

Fri, 08/31/2012 - 11:05 | 2752725 john_connor
john_connor's picture

inflation expectations are becoming unanchored as we speak

Fri, 08/31/2012 - 11:08 | 2752733 SHEEPFUKKER

Wealth effect bitchez.

Fri, 08/31/2012 - 11:17 | 2752763 LawsofPhysics
LawsofPhysics's picture

Indeed, inflation is very much in the house.  Very easy to get in things one needs, even without "velocity", especially when commoditiy providers decide not to sell, or not to accept your particular flavor of fiat.  The Fed knows this.  The Fed will defend the dollar at some level, looks like the political puppets are being sent a strong message to put their house in order least the treasuries go bidless.  When you are buying 70% of the auctions, you can say "who runs bartertown".

Paging the bond vigilantes, clean up on aisle one...

Fri, 08/31/2012 - 11:26 | 2752809 Spastica Rex
Spastica Rex's picture

Wealth affect.

Fri, 08/31/2012 - 12:00 | 2752946 Liquid Courage
Liquid Courage's picture

or ... to revive and redefine an obsolete word that obviously no-one needed anymore ... The Dealth Effect.


Dealth is illusory "Wealth" based on debt. Works for me.

Fri, 08/31/2012 - 12:24 | 2753023 trebuchet
trebuchet's picture

+5 for the "Dealth" word....

Fri, 08/31/2012 - 11:05 | 2752726 fonzannoon
fonzannoon's picture

Ben wants to rumor crude up to $125 before he pulls the trigger....makes a lot of sense...

Fri, 08/31/2012 - 11:24 | 2752797 Dr. Engali
Dr. Engali's picture

So now we get another month of fed speak and Hilsenbarf puke. It's getting a bit exhausting.

Fri, 08/31/2012 - 11:26 | 2752801 kito
kito's picture

no fonz....rumors have limited effect, perhaps oil to 100 or so.....certainly if he actually pulled the trigger now...which he wont....you would see oil to 125 and gold to 2000....but ben doesnt want either of those numbers to materialize....

Fri, 08/31/2012 - 11:27 | 2752811 fonzannoon
fonzannoon's picture

Kito if rumors had limited effect we would be 200pts lower on the S&P.

Fri, 08/31/2012 - 11:34 | 2752830 trebuchet
trebuchet's picture

@kito, his speech surprisingly emphasized "wealth effect" = confidence.....  seems like he DOES want those numbers

Fri, 08/31/2012 - 11:07 | 2752727 Temporalist
Fri, 08/31/2012 - 11:06 | 2752728 mrktwtch2
mrktwtch2's picture

fat pig michael moore says romney will win..

Fri, 08/31/2012 - 11:08 | 2752737 surf0766
surf0766's picture

Who care what the communist sympathizer says

Fri, 08/31/2012 - 11:29 | 2752817 Spastica Rex
Spastica Rex's picture

"Communist" that's so 1989.

Fri, 08/31/2012 - 11:38 | 2752846 ArrestBobRubin
ArrestBobRubin's picture

The updated term is Obammunist

Fri, 08/31/2012 - 11:39 | 2752848 surf0766
surf0766's picture

Dam that's good !

Fri, 08/31/2012 - 12:06 | 2752959 walküre
walküre's picture

In reality they're all just beneficiaries of the Almighty Fed.

That makes them all FEDOMMUNISTS

Fri, 08/31/2012 - 11:32 | 2752823 i-dog
i-dog's picture

Wavering Obomberbots?

Fri, 08/31/2012 - 11:34 | 2752834 surf0766
surf0766's picture

He and the rest of the communist sympathizers can move to cuba. They seem to want their healthcare so bad. Why wait until it is implemented here.

Fri, 08/31/2012 - 11:52 | 2752912 viahj
viahj's picture

no ben & jerry's in Cuba?

Fri, 08/31/2012 - 12:56 | 2753136 surf0766
surf0766's picture

They can move with him too. 

Fri, 08/31/2012 - 11:13 | 2752759 LouisDega
LouisDega's picture

Roger and me peak Bitchezzzz

Fri, 08/31/2012 - 11:27 | 2752812 Dr. Engali
Dr. Engali's picture

I really wish you wouldn't put down fat pigs in that way. Fat pigs are important..they provide things like ham, sausage , and bacon. Michael Moore on the other hand.....

Fri, 08/31/2012 - 12:31 | 2753050 earnyermoney
earnyermoney's picture

I think MM has the itch to make some new films. Must of exhausted his stash after 4 years of Barry.

Fri, 08/31/2012 - 12:56 | 2753139 surf0766
surf0766's picture

He ate his stash.

Fri, 08/31/2012 - 11:08 | 2752731 Snakeeyes
Snakeeyes's picture

It won't do any good. Only pump up the stock market. If he does it and Romney wins, kiss Bernanke goodbye.


Fri, 08/31/2012 - 11:08 | 2752734 IndicaTive
IndicaTive's picture

"OK fine go ahead, but just the tip...for now anyway."

Fri, 08/31/2012 - 11:10 | 2752747 Hondo
Hondo's picture

I can't believe how bad this propaganda is.....it is irrational, and desparate in nature.  It assumes the majority of people are morons.

Fri, 08/31/2012 - 11:12 | 2752752 ArrestBobRubin
ArrestBobRubin's picture

You mean they're not?

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