With the Fed's Stanley Fischer yesterday reminding [7]everyone of what Jim "QE4" Bullard said a month ago [8]when he hinted that the Fed may be hiking rates only to slam the economy into a recession thus leading to a prompt rate cut (also known as the top Jean-Claude Trichet trade of 2011) and then launch QE4 promptly thereafter, some have wondered - what will the Fed's next quantiative easing episode looks like?
The reason for the confusion is that in recent public statements, Yellen has expressed a concern with not only market overvaluation but also complacency: which is why using even more Fed reserves to prop up the artificially inflated and ever more illiquid markets would be myopic as it would push stocks even recorder without leading to any economic benefits and certainly no benefits for 90% of the population.
We got a glimpse of just what Yellen has in mind for the next 'monetary transmission mechanism' yesterday, when a mystery drone appeared above the Rosa Parks Circle in Grand Rapids, Michigan and literally rained down money on the people below, leading to what the Mail describes as a "cash-grabbing frenzy."
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The drone was recorded hovering above crowds enjoying a family event in Grand Rapids yesterday
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Clearly this was merely a small trial of the upcoming monetary paradrop: "Children and adults scrambled to collect the bills as an estimated $100 was released above picnickers, amid suggestions the operators were seen on top of a nearby JW Marriot Hotel."
More:
Witness Melvin Blohm, a creative consultant, told MLive Michigan: 'It was hovering over the center of the circle and after a couple of minutes it dropped what appeared to be money.
'Once people realized the cash was real, they swarmed to pick it up.'
Needless to say, QE4 will be a hit with children... "Unsurprisingly, the stunt proved to be a hit with children who were picnicking at the park with their parents."
But not so much the police:
Sergeant Terry Dixon, from Grand Rapids Police Department, told Fox 17: 'In a situation like this, this looks fun - fun for everyone involved - especially the kids that are out there. There's money dropping from the sky and how often does that happen?
'The problem is that it could become a safety hazard for the kids or the youths that are running to get to the money - they could be crossing the roadway and inadvertently be struck by a car or something like that.'
If the police had problems with $100, they may not like when the sky is covered in drones during the daily POMO operation, when anywhere between $3 and 8 billion falls from the sky.
So far, no one has claimed responsibility for the monetary paradrop. Perhaps someone can ask a Fed official during their endless, daily public appearances on the record just when this beta test will go gold, er, paper.
Video of the event below:
