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While You Were Sleeping, Central Banks Flooded The World In Liquidity

Tyler Durden's picture


There are those who have been waiting to buy undilutable precious metals in response to a headline announcement from the Fed that it is starting to buy up hundreds of billions of Treasurys or MBS.  This is understandable - after all that is precisely the trigger that the headline scanning robots which account for 90% of market action in the past year are programmed to do. And the worst thing that one can do is put on the right trade at the wrong time. Yet it may come as a surprise to some, that while the world was waiting, and waiting, and waiting, for Bernanke to hit the Print button, virtually every other central bank was quietly unleashing it own mini tsunami of liquidity. In fact, as Morgan Stanley puts it, "the Great Monetary Easing Part 2 is in full swing." But wait, there's more: in an Austrian world, where fundamentals don't matter and only how much additional nominal fiat is created is relevant, it is sheer idiocy to assume that the printers will stop here... or anywhere for that matter. They simply can't, now that the marginal utility of every dollars is sub 1.00 relative to GDP creation. This means that by the time the Global Weimar is in full swing, we will see much, much more easing. Sure enough, MS anticipates an unprecedented additional round of easing in the months ahead. So for those waiting to buy gold et al at the same time as DE Shaw's correlation quants do, the time will be long gone. Because slowly everyone is realizing that it is not the Fed that is the marginal creator of fake money. It is everyone.

Behold, the Great Monetary Easing part 2:

MS Summary:

The Great Monetary Easing Part 2 is in full swing – and begets inflation risks. Global monetary policy interconnectedness, the impact of central bank easing on commodity prices, and the possibility of an improved outlook for the real economy could mean a return of the Global Inflation Merry-Go-Round:


1) Super-expansionary monetary policy in the major developed economies, particularly the US, a) contributes to commodity inflation and b) is imported by EM central banks through (US dollar) soft and hard pegs.


2) Price pressures rise in EM due to domestic overheating and higher commodity prices. Inflation is then re-exported to DM through more expensive goods exports.


3) More expensive imports from EM and dearer commodities raise inflation in DM. In turn, DM central banks initiate the next round by maintaining – or increasing – monetary accommodation.


2013 might yet look like 2011 on the inflation front.

...and Detail:

The Great Monetary Easing (Part 2), is in full swing … In response to a slowing global economy and further downside risks emanating from the possibility of an escalating Eurozone debt crisis, central banks all over the world – and across the DM-EM divide – have been deploying their arsenal for a while now, and should continue to do so. The result is aggressive monetary easing on a global scale – what we have dubbed the Great Monetary Easing, part 2 (GME 2 - see Sunday Start: What Next in the Global Economy, January 22, 2012); this follows on from GME1 in 2009-10. The GME2 is now in full swing. Last week, the Bank of England announced a further GBP 50bn of gilts purchases, to take place over the next 3 months. On Tuesday, the Bank of Japan upped the target of its Asset Purchase Program by 50%, from JPY 20trn to JPY 30trn, with the increment concentrated exclusively on JGB purchases. We think Sweden’s Riksbank will pick up the baton from the Bank of Japan on Thursday and cut the repo rate by 25 basis points.

Half the world's central banks have reqliuified in the past few months!

Out of a total of 33 central banks under our coverage, 16 have eased policy in various ways since 4Q11; 7 out of 10 DM central banks and 9 out of 23 EM central banks. Many of these central banks will ease further, on our forecasts, while the central banks of Poland, Korea, Malaysia and Mexico, which have not cut so far, will also join in (and the National Bank of Hungary will likely reverse its 100 basis points of hikes over the course of the year).

What is surprising, is that the primary beneficiary of these hundreds of billions in excess liquidity from around the world, has so far been the US, where courtesy of the biggest equity market, the reflexive flaw that the stock market is the economy has led to what some have noted is decoupling, when in reality it is merely outperformance of the US stock market, where the bulk of global liquidity has concentrated. And now, like in 2011, that luiqidity is starting to spill over again: gas just hit $3.52, and rising ever faster, which just happens to be the most direct, implicit tax on US consumera. And it is now detracting from growth. 

Finally, another way of visualizing the global central banks' balance sheets.


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Thu, 02/16/2012 - 15:11 | 2166710 battle axe
battle axe's picture

Print and print some more until we run out of ink. Yeaaaa Haaaaa

Thu, 02/16/2012 - 15:12 | 2166721 LawsofPhysics
LawsofPhysics's picture

computers don't require ink, just energy.

Thu, 02/16/2012 - 15:22 | 2166760 Troll Magnet
Troll Magnet's picture

i should buy more silver then?

Thu, 02/16/2012 - 15:24 | 2166768 The Watchman
The Watchman's picture

I thought I felt a wet spot in the bed last night, but I didn't say nothing.

Thu, 02/16/2012 - 16:14 | 2166969 bobola
bobola's picture

When I was a kid we would play Monopoly with 2 banks, and everyone would get double the starting cash.

It took longer to go bust, but those who played smart and had good luck made wads of $$.

Same game, different circumstances.

Thu, 02/16/2012 - 16:22 | 2167009 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

We're all gonna be billionaires!

Thu, 02/16/2012 - 17:08 | 2167214 JPM Hater001
JPM Hater001's picture

Go debt go!

I know you can do it.

Thu, 02/16/2012 - 17:58 | 2167394 Sudden Debt
Sudden Debt's picture

They flooded the world with trillion... And all I got was.... Nothing....

Thu, 02/16/2012 - 18:36 | 2167504 Max Fischer
Max Fischer's picture



Are you aware that under the offical Monopoly rules, the bank can never run out of money?  If all the Monopoly money has been distributed, players are allowed to issue new pieces of paper with denominations written on them. 

If libertarians created Monopoly, the game would just end as soon as all the money was distributed because elastic currency is evil.  I always marvel at how libertarians can believe that the growth of an economy should be tethered to something totally arbitrary like the availability of a metal.  Throughout all of history, inelastic currencies have always been replace by elastic currencies which have the ability to conform to the needs of a growing economy. 

Max Fischer, Civis Mundi 


Thu, 02/16/2012 - 19:34 | 2167672 OutLookingIn
OutLookingIn's picture

until these elastic currencies are printed into oblivion.

There. Fixed it fer ya! 

Thu, 02/16/2012 - 20:58 | 2167871 francis_sawyer
francis_sawyer's picture

Yeah? Is that so Max Fischer, Civis Mundi? (champion of dickheaded reasoning)...

Last time I remember playing 'Monopoly', not only was it played with play money... But I didn't have to starve, or heat the house, or put gas in the token to travel around the board...

You are about the most self righteous (but 'dumbest') motherfucker on the p[lanet...


Thu, 02/16/2012 - 21:05 | 2167887 blunderdog
blunderdog's picture

I understand the concern. 

You know what comes right after the reinstatement of the non-fractional gold standard that every two-bit survivalist thinks is going to magically solve everything? 

Those  same fuckin' assholes who couldn't be bothered to understand the basis for an elastic money supply start calling for the slaughter of the Jews... because they hoard all the gold.

And so it goes...hope you're keeping dual-citizenship, Max.

Sun, 02/19/2012 - 04:11 | 2174475 stacking12321
stacking12321's picture

max, i am guessing you are trolling, you can't possibly believe that.

as money is a store of value, it should be tied to something, oh, i dunno, maybe actually *of value*.

it can be something arbitrary like gold or silver or something else, as long as it's real.

it absolutely must not be tied to something imagniary like a rainbow emanating from a unicorn's horn, that can be created with a wave of bernanke's magic wand, because if you do, then money becomes meaningless, and that's the realization we're coming to today.


Thu, 02/16/2012 - 15:49 | 2166842 J 457
J 457's picture

NG and coal and oil.  Materials will make a come back with all this money fresh money comes looking for hard assets to buy.

Thu, 02/16/2012 - 16:04 | 2166904 The Big Ching-aso
The Big Ching-aso's picture



No wonder my hands are covered in multi-colored ink after I fished through the wallet for a $20.

Thu, 02/16/2012 - 16:33 | 2167068 dontgoforit
dontgoforit's picture

Our Fusex acct is up a ton (mostly thanks to Exxon, Chevron & Apple).

Thu, 02/16/2012 - 16:39 | 2166946 Jumbotron
Jumbotron's picture

computers don't require ink, just energy.


They're going to need more voltage.

Thu, 02/16/2012 - 15:14 | 2166730 Future Tense
Future Tense's picture

Yes, keep the floodgates open.  It will only push up stocks higher, bringing higher sentiment into the stock market, creating the ultimate short opportunity.  The chart in this link has the most recent investor newsletter sentiment reading levels.  Can you say all in?

Thu, 02/16/2012 - 15:19 | 2166739 RichardP
RichardP's picture

It will only push up stocks higher ...

Dow = 14,000 in six to eight months.  Politics requires it.

Thu, 02/16/2012 - 15:23 | 2166763 SheepDog-One
SheepDog-One's picture

Six to eight months? Nonsense...we're only a few more trading days like today from new world record highs! Feb 28th DOW 14,500!

Thu, 02/16/2012 - 15:31 | 2166794 Spitzer
Spitzer's picture

Until the treasury bubble pops, the DOW will creep to a new high, the Cad and Aussy housing bubbles will continue to inflate and Japan will be on its way to 500% debt to GDP. Its all about treasuies, nothing else.

Thu, 02/16/2012 - 15:34 | 2166801 VanillAnalyst
VanillAnalyst's picture

All in on commodities maybe. But going short in the face of multiple tsunamis of liquidity in the coming years? balls out dude. Hope you can hang on long enough.

Thu, 02/16/2012 - 15:36 | 2166809 bob_dabolina
bob_dabolina's picture

The Treausury bubble doesn't have to pop as the Fed can print money to buy Treausuries ad infinitum if it wants. The natural consequence of this is obviously inflation. 

Thu, 02/16/2012 - 17:03 | 2167195 Eally Ucked
Eally Ucked's picture

It doesn't matter, DOW can go to 16k shortly but it's only the play for banks and hedge funds or few percentages of population. The rest is squeezed out so much paying for everything more and more by the day that suddenly all those earnings for american cos will evaporate in the nick of a time. Thanks to good propaganda job people are just spending their savings expecting return of good times any moment, but that moment is already delayed by 4 years and the savings are almost gone. And suddenly there is no more money for movies, cable, iphones, burgers, gas, nails, vacations and other things. Earnings from Asia won't help them for long time because those pesky Chinese will produce their own version of everything.  

Thu, 02/16/2012 - 15:23 | 2166764 economics1996
economics1996's picture

Fake wealth to quote Peter Shiff.

Thu, 02/16/2012 - 20:28 | 2167818 ConspiracyTheory
ConspiracyTheory's picture

Yes, absolutely all in. Sell your house, cars, and family and put all the money to short the freight train. The more short piling up, the faster the freight train melt-up continues.

Thu, 02/16/2012 - 15:21 | 2166757 taniquetil
taniquetil's picture

Then print more ink. Then print more printers.

Thu, 02/16/2012 - 16:14 | 2166964 Jumbotron
Jumbotron's picture

Print more printers......

Why not....with 3D printers you can.....



Thu, 02/16/2012 - 15:49 | 2166846 LongSoupLine
LongSoupLine's picture



"Drink the's good!" - Jim Jones

Thu, 02/16/2012 - 15:12 | 2166718 LawsofPhysics
LawsofPhysics's picture

Precisely why I am long commodites and taking physical delivery whenever possible.  Natural gas is a buy, now to find a place for some big ass storage tanks.

Thu, 02/16/2012 - 15:26 | 2166778 slaughterer
slaughterer's picture

My husband does not mind me locating my natural gas storage tanks underneath the swimming pool.   Keeps them hidden from the mob when the time comes.  

Thu, 02/16/2012 - 16:03 | 2166897 Raisuli
Raisuli's picture

While it is difficult to find fault with keeping the natural gas storage underneath the pool. I suggest that you use the possesive pronoun with the gerund whenever. So, you would be more grammatically correct by saying: "My husband does not mind my locating my nat....

Just sayining...

Thu, 02/16/2012 - 21:41 | 2167971 Vlad Tepid
Vlad Tepid's picture

Really?  You're going to get that uptight that you're throwing out gerundal possessive coaxial widgets, yet you spell "saying" as "sayining?"

PS You forgot to end the quotation with a quotation mark, ass.  Welcome to ZH.

Thu, 02/16/2012 - 16:04 | 2166903 falak pema
falak pema's picture

I'm sure he likes to swim in dangerous places.

Thu, 02/16/2012 - 15:14 | 2166723 Ahmeexnal
Ahmeexnal's picture

Morgan Stanley comes up with a chart containing "Isreal".
If MS can't even spell, I'm sure their math and statistics is even worse.
Time to dump MS.

Thu, 02/16/2012 - 15:42 | 2166820 BlackSunshine
BlackSunshine's picture

I noticed that as well, but I was thinking that

1. They purposely misspelled it for their Taliban employee constituents.

2. It was done in jest, to say Isral = IS REAL.

I don't know which one, but it is a function of the employee demographics at MS.

Or maybe the stat guy is Al Qaeda, and he didn't want to spell it out correctly.

Thu, 02/16/2012 - 15:43 | 2166821 BlackSunshine
BlackSunshine's picture

I noticed that as well, but I was thinking that

1. They purposely misspelled it for their Taliban employee constituents.

2. It was done in jest, to say Israel = IS REAL.

I don't know which one, but it is a function of the employee demographics at MS.

Or maybe the stat guy is Al Qaeda, and he didn't want to spell it out correctly.

Thu, 02/16/2012 - 15:45 | 2166830 BlackSunshine
BlackSunshine's picture

In any case, what's your excuse for being an anti-semite?

-A. Foxman.

Thu, 02/16/2012 - 15:14 | 2166725 Theta_Burn
Theta_Burn's picture

Yet Miners and PM's are still fast asleep.....

Thu, 02/16/2012 - 15:23 | 2166765 flacon
flacon's picture

Maybe you are in the wrong miners?


Year To Date:

ATAC Resources: +19%

Avalon Rare Metals: +24%

Great Panther: +25%

Silver Standard: +15%

and my favourite TINKA: +85%


Not bad eh? 

Thu, 02/16/2012 - 15:32 | 2166797 Spitzer
Spitzer's picture

Yeah thats because anyone who got in before that got their head knocked off. All of those stocks where down 60% toward the end of the year

Thu, 02/16/2012 - 15:39 | 2166806 Theta_Burn
Theta_Burn's picture

Nice hits

Seems the gamble associated w/those names paid nicely for you.

Whats the story with HL (up 3.69% today) 1 of my favs awhile back, never seen a co. more fucked with.

Thu, 02/16/2012 - 15:42 | 2166819 hack3434
hack3434's picture

Misleading for the most part...ATAC is DOWN 65% from Aug of last year. 600MM of market cap "evaporated".

Thu, 02/16/2012 - 15:53 | 2166867 J 457
J 457's picture

AVL was close to $10.00 in May 2011 and now its $3.00.  Yea, those REE's are a sure thing, if you want to lose money.  But if the liquidity comes they may just start the upward climb.

Thu, 02/16/2012 - 15:39 | 2166814 LawsofPhysics
LawsofPhysics's picture

Paper promises...

Thu, 02/16/2012 - 15:13 | 2166726 Yen Cross
Yen Cross's picture

It was a SWAP.

Thu, 02/16/2012 - 15:14 | 2166728 I am more equal...
I am more equal than others's picture

Let the printing presses roll.  This will cause global warming because trees will be cut for the paper causing the building up of CO2. But the upside is lumberjacks will be busy for a while so that will cause employment growth.  And now for something really ridiculous...

I'm a lumberjack and I'm ok....


Thu, 02/16/2012 - 15:15 | 2166732 100pcDredge
100pcDredge's picture

Thank you Central Banks.

For these Lethal Injections.

Now I can go to sleep - finally.

Thu, 02/16/2012 - 15:20 | 2166754 Jonas Parker
Jonas Parker's picture

The "Jack Kevorkians" of the financial world...

Thu, 02/16/2012 - 15:17 | 2166736 falun bong
falun bong's picture

is this the regular everyday inflating/debasement...or do they know something we don't know? i wonder

Thu, 02/16/2012 - 15:19 | 2166741 SheepDog-One
SheepDog-One's picture

COOL! Only 15 more trading days like today, and markets can bust thru all-time record bubbletop highs again! Thats all that REALLY matters!

Thu, 02/16/2012 - 15:18 | 2166746 mammoth mo
mammoth mo's picture

What is up with the Stoxx 600 negative 10% close that is being called inaccurate and a technical issue.

Don't let me down Tyler.

Thu, 02/16/2012 - 15:20 | 2166758 SheepDog-One
SheepDog-One's picture

Whats up with ANY index being down? Hell we're in full euphoria mode now! Yipee!

Thu, 02/16/2012 - 15:19 | 2166748 YesWeKahn
YesWeKahn's picture

I wondered why printers are so cheap these days.

Thu, 02/16/2012 - 15:20 | 2166756 The Swedish Chef
The Swedish Chef's picture

But, but, but...LTRO wasn´t QE!! 


Seriously though, it was the least we could do. Big Ben hosed the world down good with his "Cash For Garbage" program, also known as QE1&2. Now it is our turn to do the same, just with garbagier collateral and somewhere in the distant future a payback of the money. Like that´s gonna happen...

Thu, 02/16/2012 - 15:24 | 2166759 slaughterer
slaughterer's picture

I hope the Europolitiker are trading their rumors.  They could have made enough to fund the whole Greek bailout by now just by flipping SPY options over the last few days frontrunning their news bombs.  

Thu, 02/16/2012 - 15:22 | 2166761 Yen Cross
Yen Cross's picture

 Conjunction/Function, what is your function? Can you tell me how? How do I get to Sesame Street?

Thu, 02/16/2012 - 15:24 | 2166770 SheepDog-One
SheepDog-One's picture

Seems we left Sesame Street and are now wandering around in Full Retardville.

Thu, 02/16/2012 - 15:35 | 2166804 Yen Cross
Yen Cross's picture

Agree 100%

Thu, 02/16/2012 - 15:26 | 2166773 non_anon
non_anon's picture

as the shadow of mordor creeps across the land

Thu, 02/16/2012 - 15:26 | 2166775 youngman
youngman's picture

Just last week  we had Japan...Great Britain..and the Greek Bailout...but it did not move gold and silver to much...only Apple stock...almost a trillion one week

Thu, 02/16/2012 - 15:29 | 2166785 The Watchman
The Watchman's picture

Say bye bye to making sense of it... We ain't in Kansas anymore.

Thu, 02/16/2012 - 16:20 | 2167000 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Right, and how did Dorathy get home?  She clicked her slippers.  And what color were those slippers?

Sun, 02/19/2012 - 02:10 | 2174398 ChacoFunFact
ChacoFunFact's picture

they were ruby red but the original srcipt called for them to be.... silver

Thu, 02/16/2012 - 16:18 | 2166990 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Shirakawa was buying AAPL.

Thu, 02/16/2012 - 15:40 | 2166790 blu
blu's picture

So! You have finally stumbled upon the genius of my 5 point plan for world domination! But you see, it is already too late. For my minion army of HFT bots and fiat-hags have already taken over the entire global world financial structure! You are too late Super Tyler! Muaa-Hahahahaha! Too late you silly fool! Already I have picked men in the highest places waiting for the word, the word which means we seize all control of the world stage. And you -- you pitiful but useful idiot -- have been an incalculable aid! Oh yes! Here, I will explain. But wait I must first activate my globo-scopic radio dome so all the world can hear me as I say -- hold on I tried this just a moment ago and it -- ah yes see there it is working -- so all the world can hear me say to you foolish Tyler and the whole world that I the terrible Blu -- yes it is a silly name but I'm working on that -- that I have complete control of all aspects of your pitiful human lives going forward! You must and you will bow to my every wish! Muaaa-hahahahahaaa! And my first wish for all humanity and oh yes especially those freaks at Zerohedge -- my first wish is that you all stop staring at my tits!!

No wait. That is not my first wish. Dammit that was not it! Who wrote that on my notes?! I demand to know! Hey get away from my globo <sizzle><click><hummmmmmm...>

Thu, 02/16/2012 - 21:46 | 2167983 Vlad Tepid
Vlad Tepid's picture

Gorzo the Mighty meets Dave Barry.  Excellent!

Thu, 02/16/2012 - 15:32 | 2166796 adr
adr's picture

Was this supposed to be news??? The market doesn't go from 6000 to 13k on retail money. It sure as hell doesn't break the past two bubble highs on real money.

Thu, 02/16/2012 - 15:33 | 2166800 slewie the pi-rat
slewie the pi-rat's picture

we have been noting this for many moons, now

most recently, some of us were discussing exactly this earlier today:

"Lehman 2.0" Imminent Warns John Taylor

L0L!!!  who was it started those pernicious rumorZ about "stealth" QE?  jimWillie, maybe?

Thu, 02/16/2012 - 16:18 | 2166985 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

The Europonzi will implode during the next moon cycle, speaking of moons.

Thu, 02/16/2012 - 15:34 | 2166802 BlackSunshine
BlackSunshine's picture

So let me get this straight, if A = 0, and A * .01 = 0, still A = 0.

Or put it this way, If I steal 2 Billion USD, but  USD = 0, then I haven't stolen anything.

Mazeltov B!tchez.

Thu, 02/16/2012 - 15:36 | 2166811 Yen Cross
Yen Cross's picture

No ALGO's allowed.

Thu, 02/16/2012 - 15:47 | 2166824 Everybodys All ...
Everybodys All American's picture

Now that the banks have gotten the liquidity injection. Can we now expect the Greece deal to 'suddenly' fall apart once again?

If this Greek deal is as stated and the debasement continues it is no wonder that the banks again need to be downgraded because everything they hold in the form of bonds is worth less by the debasement. But it's not as if they report the 'real numbers' anyway. Rally on homes. 

Thu, 02/16/2012 - 15:44 | 2166826 Lost Wages
Lost Wages's picture

Was thinking about selling ARTQX and buying PTTRX in our 401K today. *ponders* Will be keeping UMBMX and BCSIX for stocks.

I mention this because PTTRX has all that good Fannie Mae MBS garbage in it a.k.a. Ben Bernanke's charity.

Thu, 02/16/2012 - 15:44 | 2166827 Dr. Engali
Dr. Engali's picture

Dollars dollars everywhere but not an extra one for me.

Thu, 02/16/2012 - 15:45 | 2166829 NotApplicable
NotApplicable's picture

Race ya to the bottom!

Thu, 02/16/2012 - 15:46 | 2166831 Tsar Pointless
Tsar Pointless's picture

To think, there are people who still believe the equity markets are going to crash.

Uh-huh. The Pittsburgh Pirates have a better chance of meeting God after winning the World Series this year than that happening.

If nearly three years of a relentless grind up in equities isn't enough to convince you otherwise, what will?

They will NEVER quit printing (physically or electronically) and you all know it.

Thu, 02/16/2012 - 15:46 | 2166833 Arkilokoos
Arkilokoos's picture

If you are in paper gold, is Sprott PHYS any better than GLD???

Thu, 02/16/2012 - 21:50 | 2168011 Vlad Tepid
Vlad Tepid's picture

Guess no one here is in paper gold.  (That's a hint.)

Thu, 02/16/2012 - 15:48 | 2166835 bobbydelgreco
bobbydelgreco's picture

you almost get it; this is why bernanke fails in the end; stuck with the dollar every one else will out devalue ben especially when the euro goes; then dollar up every thing else feces even gold

Thu, 02/16/2012 - 15:48 | 2166838 q99x2
q99x2's picture

"[US stock market] where the bulk of global liquidity has concentrated."

If that is true then HFT must have gone to sleep because volume is down in 2012. But maybe it has held the market up when everyone has had reason to sell out.

How does the money get from the FED into the stock market?

Is there explicit evidence that money is moving along those channels?

I would like to see the particulars.

Thu, 02/16/2012 - 15:49 | 2166849 SoNH80
SoNH80's picture

BUY! BUY! BUY!  I tells ya, get in on the ground floor, before it's too late!  Good names, like American Can, AT&T, Radio, Steel, you can't lose!  Dividends, security for your family, for your old age.  How about some Gold Bonds?  Backed by the full faith and credit of Schlansky's Curb Market, outside of the candy store at Broadway and Wall?  Good, solid investment.  Why, things are coming up roses, don't sell the U.S.A. short!  Peace in our time, peace and prosperity.  Don't be a fool, jump in NOW.  You'll be kicking yourself if you don't.  If you do, you'll be snug as a bug in a rug, what with a new Oakland, a superheterodyne radio, some new lampshades with little frills on them for the Missus, and a little place on Miami Beach!

Thu, 02/16/2012 - 16:08 | 2166929 blu
blu's picture

Goll darn that seems mighty generous. Miami Beach! Well I al'ays did wanted to go thar some o' these days, yezzer.

Thu, 02/16/2012 - 15:50 | 2166851 gjp
gjp's picture

Well that high-volume 'correction' lasted a little more than 24 hours by my calculation.  In robotrader's terminology that's world record duration for 2012!  Now back to your regular Weimar programming ...

Thu, 02/16/2012 - 15:55 | 2166864 battlestargalactica
battlestargalactica's picture

"I've been asked to speak on the theme of Roman history, particularly the problem of inflation and its impact. My analysis is based on the premise that monetary policy cannot be studied, or understood, in isolation from the overall policies of the state.

Monetary, fiscal, military, political, and economic issues are all very much intertwined. And they are all so intertwined because any state normally seeks to monopolize the supply of money within its own territory.

Monetary policy therefore always serves, even if it serves badly, the perceived needs of the rulers of the state. If it also happens to enhance the prosperity and progress of the masses of the people, that is a secondary benefit; but its first aim is to serve the needs of the rulers, not the ruled. This point is central, I believe, to an understanding of the course of monetary policy in the late Roman Empire."

-from Professor Joseph Peden's lecture "Inflation and the Fall of the Roman Empire"

Got paradigm ending parallels, bitchez???

Thu, 02/16/2012 - 16:05 | 2166909 Yen Cross
Yen Cross's picture

Kool Name/ Battle Star Galactica. NICE!

Sun, 02/19/2012 - 02:14 | 2174402 ChacoFunFact
ChacoFunFact's picture

we are all descendants of the roman army

Thu, 02/16/2012 - 15:55 | 2166870 BlackholeDivestment
BlackholeDivestment's picture





...hmmm, Chart Tsunamis and Earthquake Generated Tsunamis at the same time

                                   as in the 

                                Days of Noah 

                The only thing missing is a war with

                                ...oh, oops. 

Thu, 02/16/2012 - 15:56 | 2166875 devo
devo's picture

Was it George Orwell who said they always come for you at night?

Maybe it was in the Nazi documentary I recently watched. I can't remember.

Thu, 02/16/2012 - 15:56 | 2166877 kito
kito's picture

flooding is coming from deflationary forces, and the worlds printing press cant keep up fast enough................print a billion, lose a billion, print a billion, lose a billion, print a billion, lose a billion...................hyperinflation will never happen....................

Thu, 02/16/2012 - 16:36 | 2167081 devo
devo's picture

That is a very simplistic view.

Thu, 02/16/2012 - 15:56 | 2166879 ex VRWC
ex VRWC's picture

May I present again The ZIRP Song.  Share it with the uninitiated.  It is pleasant to listen to, fun musically and its lyrics are powerful, simple, and clear.

Thu, 02/16/2012 - 15:58 | 2166883 spartan117
spartan117's picture

Gas up to $3.97 regular here in southern cal.  That's up another 10 cents in one week.  Where's that damn deflation everyone keeps talking about.  Deflate something already.

Thu, 02/16/2012 - 16:01 | 2166893 Squid Vicious
Squid Vicious's picture

bullish! (where's robo-tarder i thought he was just gabbing about how CHEAP gas is in socal?)

Thu, 02/16/2012 - 16:07 | 2166908 TruthInSunshine
TruthInSunshine's picture

The higher prices on everything from gasoline to groceries to glue (which a lot more people who will be impoverished will be sniffing in modern day Hoovervilles) go, the better the chance the government can maintain that the eonomy isn't shrinking despite the continuing precipitous fall in consumption.

Higher prices offset what would otherwise would have to be reported as contraction of economic activity and standard of living.

Heed this message from Big 'Sis:

Thu, 02/16/2012 - 17:20 | 2167249 DosZap
DosZap's picture

Heed this message from Big 'Sis:

Is this for folks that KNOW things?.

Or just Nazi propaganda part Deaux?.

Know your place?,YOU shitting ME?,I do its called America.

And I will say what I want when I want.

Thu, 02/16/2012 - 22:24 | 2168105 TruthInSunshine
TruthInSunshine's picture

You are on the naughty list.




Big 'Sis

Thu, 02/16/2012 - 16:09 | 2166932 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Everyone will put the houses they have been waiting to sell since the market crash up for sale starting next month and they will be met with a record number of foreclosed properties. 

There is your deflation.

Thu, 02/16/2012 - 15:58 | 2166885 Gief Gold Plox
Gief Gold Plox's picture

Gents, I've got a question, a bit off topic, but still related. When it's announced that the gold price moved two standard deviations in the last hour, what is the sample size used to determine the "standard deviatoin"? Is it even a fixed amount of historical data points or a more complex sampling scheme? Many thanks for your answers.

Thu, 02/16/2012 - 15:59 | 2166886 toadold
toadold's picture

"...Just one thin little mint Mr. Creosote.."

Of course this time it is going to take more than a mop, a bucket, a wash cloth, and one body bag to clean up the mess.

Thu, 02/16/2012 - 16:03 | 2166898 Yen Cross
Yen Cross's picture

Nap Time. Trading the Edges.

Thu, 02/16/2012 - 16:04 | 2166902 Jumbotron
Jumbotron's picture

"It's QE to the moon Alice.....QE to the moon !!!!"

And once QE reaches the wakes up the Nazi's.....



Thu, 02/16/2012 - 16:05 | 2166905 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

From the depths of Hell they came to conquer the world.  In the tales of old we called them nightcrawlers, and demons.  Now we call them....banksters.

From the creaters of Fiat Money and Fiat Ponzi comes an epic tale of corruption and greed.

During the last century humanity had woken up to the Fed's true mandate, to steal the wealth of the people.  Now there is a new enemy....

Slowly everyone is realizing that it is not the Fed that is the marginal creator of fake money: It is everyone.

Thu, 02/16/2012 - 16:08 | 2166926 Yen Cross
Yen Cross's picture

+ Infinity Mr. Lennon Hendrix. I'm too lazy to change the ( Key Strokes).  Well done, and see you in opposite ASIA.

Thu, 02/16/2012 - 16:11 | 2166943 blu
blu's picture

Yeah that was a creepy line. You got the gist of it too. Sort of a "night of the body snatchers" thing.

Thu, 02/16/2012 - 16:12 | 2166944 blu
blu's picture

de-dup dedoop

Thu, 02/16/2012 - 16:20 | 2166991 Jumbotron
Jumbotron's picture

From the depths of Hell they came to conquer the world.  In the tales of old we called them nightcrawlers, and demons.  Now we call them....banksters.

From the creaters of Fiat Money and Fiat Ponzi comes an epic tale of corruption and greed.

During the last century humanity had woken up to the Fed's true mandate, to steal the wealth of the people.  Now there is a new enemy....


They're called  C.H.U.D.   (Cannibalistic Humanoid Underground Dwellers)


Thu, 02/16/2012 - 16:08 | 2166920 SmoothCoolSmoke
SmoothCoolSmoke's picture

I know I'm insane, but we just made a Double Top on the Dow weekly chart.  Not insane that I see it, but insane that I think it may act as a DT.   

Thu, 02/16/2012 - 16:08 | 2166922 innsbrooklad
innsbrooklad's picture

You can't fight these pricks...They will print you into bancruptcy if you short the markets.

You have to take away the money and not buy soverign debt or sell it all.

The downside to this is awful but they can keep this game going a long time.

Thu, 02/16/2012 - 16:16 | 2166975 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Yes, that's right....

You have to take away the money

Buy silver

Thu, 02/16/2012 - 16:29 | 2167047 XitSam
XitSam's picture

They've already kept it going a long time. Buy gold.

Thu, 02/16/2012 - 16:12 | 2166952 walküre
walküre's picture

On the surface, nothing is going to change. Peeps can stay fast asleep and go about their business.

The reality is that things aren't improving though and jobs are hard to find if there are any jobs at all.

It doesn't increase consumption. It just keeps governments running their status quo to avoid global revolution and chaos.

Real inflation will edge higher considerably as resources become scarcer and money becomes worth less. Then there's the issue that global population is ever expanding, ever more consuming and ever more demanding.

Make no mistake, the next great culling is already being discussed. Maybe not executed just yet, but the targets have been selected.

Thu, 02/16/2012 - 16:15 | 2166974 Archon7
Archon7's picture

Makes one want to think up ways to put fake headlines out there just to screw up the headline-scanning robots.

Thu, 02/16/2012 - 20:02 | 2167736 JuicedGamma
JuicedGamma's picture

Never mind

Thu, 02/16/2012 - 16:16 | 2166977 Scalaris
Scalaris's picture

Operation Torque?

Sounds naughty, but in a filthy way. Like a dildo attached on an electric screwdriver.

Thu, 02/16/2012 - 16:26 | 2167031 xela2200
xela2200's picture

Funny, I can't find any QE ney sayers anywhere anymore.

Thu, 02/16/2012 - 16:44 | 2167108 EmileLargo
EmileLargo's picture

The central banks are flooding the system with money to counter the massively deflationary effect of de-leveraging. Governments are borrowing like there is no tomorrow on the Keynesian assumption that if they don't reduction in private and corporate debt will cause a deflationary collapse. The effect of these countervailing forces is that actual inflation as felt by the average joe in the economy has been extremely muted (when set against the massive doses of printed money that have been injected). So even if all US GDP growth has just been monetary inflation, the rate of inflation between 2000 and 2012 only comes to about 4.5 percent. More than what is considered "acceptable" but not enough to cause a revolution. 

The question that preoccupies everyone's mind is when does this start to skyrocket. In the end if you keep printing this way, prices will go through the roof. But the question is when. I have a theory about the time that inflation kicks into very high gear and gets out of control. Not enough space here to write about that. 

One interesting fact is that dollar reserves held by foreign central banks have multiplied by a factor 10 in the last 15 years. If one takes this into account, the inflation rate is several multiples of 4.5 percent. The question is when this finds its way into the US economy. It will at some stage it will. Hard to say when. 

Thu, 02/16/2012 - 16:55 | 2167158 css1971
css1971's picture

Raw materials have already increased, it is wage inflation which has not and that is down to China.

Watch the CNY/USD.


Thu, 02/16/2012 - 20:36 | 2167834 EmileLargo
EmileLargo's picture

Wage inflation has been exported to China for the time being. And the Chinese have absorbed huge amounts of excess dollars which would otherwise have caused significant inflation. Question is how long they can continue to do so.  

Thu, 02/16/2012 - 21:37 | 2167951 deflator
deflator's picture

 I am an average Joe and can tell you that I feel both downward pressure on wages and upward pressure on food and energy prices. Many in the "food sector" are reluctant to raise prices, they are unabashed at lowering quality, substituting ingredients and shrinking(dramatically) portion sizes.

 You are right, clearly the tipping point will be at the macro level where those outside the sphere of USD hegemony protection stop absorbing the losses incurred by maintaining the status quo. I believe Greece is the first of many dominoes yet to fall...

 Once they start falling everyone will say how obvious it was...

Thu, 02/16/2012 - 16:48 | 2167123 Redneck_Rampage
Redneck_Rampage's picture

MS must be off their friggin rocker! or no one editted that table QE 2012 500-750 TRILLION??? of treasories and MBS...  apparently now's not too late to buy the yellow shiny stuff and pack it away like a ferret 

Thu, 02/16/2012 - 16:57 | 2167164 Platinum_Investor
Platinum_Investor's picture

I just don't get how the S&P has risen 20% in a few short months because of all this liquidity yet the metal stocks and metals itself

are still not at all time highs as well.



Thu, 02/16/2012 - 16:58 | 2167167 Youri Carma
Youri Carma's picture
Posted it before but was not picked up: US MORTGAGE MEMO: Fed Buys $6.25B Agency MBS In Week Feb. 8 NEW YORK, Feb 9 (MNI) - The New York Federal Reserve purchased $6.25 billion agency mortgage-backed securities in the week ended February 8.   The largest purchases in the latest week were in Fannie Mae and Freddie Mac 30-year "to-be-announced" (TBA) securities with 3.50% coupons for March delivery. Those buys totalled $3.55 billion. In its next largest purchase of the week, the Fed stepped up its buying of Ginnie Mae and Ginnie Mae II securities by purchasing a total of $950 million 30-years with a 3.5% coupon for April delivery. The NY Fed executed no TBA dollar roll trades in the latest week. The Fed also said it will announce how many agency MBS it expects to buy in the month ahead on Friday.
Thu, 02/16/2012 - 18:03 | 2167409 oc
oc's picture

Is that a misprint on line one of that chart : 'To ease further : QE $500-750 TRILLION ?. Oops.

Thu, 02/16/2012 - 18:22 | 2167473 eddiebe
eddiebe's picture

Deal with it!

Thu, 02/16/2012 - 18:53 | 2167556 HD
HD's picture

If the Greece default is indeed worse than Lehman - isn't now the best time to flood the system with fake money? I think they are just prepping the patient.

Thu, 02/16/2012 - 20:46 | 2167845 NuYawkFrankie
NuYawkFrankie's picture

Sure beats flooding the mattress with liquidity while sleeping...

Thu, 02/16/2012 - 21:22 | 2167923 deflator
deflator's picture

 YAY! Central banks flooded the markets with liquidity!

 I work by the hour and this, "flooding of liquidity" no doubt hurt my "bottom line" but hey look at what it did for those in finance.

Thu, 02/16/2012 - 21:29 | 2167945 engineertheeconomy
engineertheeconomy's picture

I love hyperinflationz

Thu, 02/16/2012 - 23:00 | 2168222 Dermasolarapate...
Dermasolarapaterraphatrima's picture

My health insurance just went up another 12%.

Between Obamacare and Timmy's "Strong dollar" and "no inflation" policies, I 'm getting killed!

Fri, 02/17/2012 - 00:35 | 2168478 Likstane
Likstane's picture

I bought what I thought was a half ounce eagle for 550 frn's today.  Sounded like I stole it till I got it to the car and realized it was just a quarter.  That sucked!

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