Monetization

Monetization
Sprott Money's picture

The Krugman Con

Gold’s biggest enemy is a brilliant Nobel Prize winning economist, university professor and columnist for the New York Times. Sadly, he is also a con man. 

Why The Friedman/Bernanke Thesis About The Great Depression Was Dead Wrong

No, Ben S. Bernanke will be someday remembered as the world’s most destructive battleship admiral. Not only was he fighting the last war, but his whole multi-trillion money printing campaign after September 15, 2008 was aimed at avoiding an historical Fed mistake that had never even happened!

Indians Urged To Give Up Their "Idle Gold" For The Good Of The Nation

While we still await the Indian government to unveil the "threats and fines" part, it started the "urging" when during an address on his monthly radio programme of "Mann Ki Baat", Indian prime minister Modi "exhorted people to help convert gold to the nation's economic strength by joining in various schemes to be launched soon" adding that "gold can be converted from dead money to an economic force. To leave gold lying as dead money is behaviour not in sync with the modern times," he said.

Draghi "MOAR QE Please" Press Conference - Live Feed

Update: DRAGHI SAYS ECB DISCUSSED A FURTHER LOWERING OF DEPOSIT RATE

Draghi hints at December QE expansion, noting that "the degree of monetary policy accommodation will need to be re-examined at our December monetary policy meeting." 

What Will Mario Draghi Announce Tomorrow: Here Is What Wall Street Thinks

Tomorrow morning Mario Draghi is widely expected to if not announce an extension, or expansion, of the ECB's QE program, than to at least jawbone sufficiently, and push the EURUSD lower from its recently anchored level in the 1.10-1.20 range. But what are the specifics of Draghi's announcement: will he merely expand the monetization limit per security, as he did in early September, will he increase the universe of eligibile securities, or will he simply extend the maturity of the non-open ended QE from September 2016 to some indefinite date? The following list, courtesy of Bloomberg, summarizes what the sellside universe believes Draghi will unveil in just under 12 hours.

Bernanke's Balderdash

The US and world economies are drifting inexorably into the next recession owing to the deflationary collapse of commodities, capital spending and world trade. These are the inevitable “morning after” consequence of the 20-year global credit binge which has now reached its apogee. The apparent global boom during that period was actually a central bank driven excursion into the false economics of household borrowing to inflate consumption in the DM economies; and frenzied, uneconomic investing to inflate GDP in China and the EM. The common denominator was falsification of financial prices. By destroying honest price discovery in the financial markets, the world’s convoy of money-printing central banks led by the Fed elicited a huge excess of financialization relative to economic output.

Prominent Permabull Says Correction Not Over Yet, Expect "Final Capitulation"

"The strong stock market rally during the last few days has pushed the S&P 500 near its highest closing level since the correction began in late August. This has boosted optimism that the recent selloff may be ending. While this could certainly prove to be the case, we remain less sanguine that the vulnerabilities, which initially produced this correction, have yet to be resolved. Ultimately, we expect a more fearful investment culture suggesting a final capitulation and more importantly, a lower stock market valuation level able to withstand a less hospitable recovery as the economy nears full employment."

Japanese Pension Funds Find New Ways To Lose Money, Will Blow Retirement Funds On Junk Bonds

With Japan's economy already sliding into its 5th recession of the past decade, once pensioners open their retirement statements in a few weeks and find a 15% plunge in their purchasing power, Japan can skip recession and proceed straight to a consumer-driven recession. But wait, there's more: because if pensioners are angry now, wait until they learn that they have lost everything, after buying all those junk bonds that Carl Icahn is now actively selling with both hands and feet, because: JAPAN PENSION FUND TO INVEST IN JUNK BONDS, NIKKEI SAYS. And just like that, with or without Krugman's active economic advice, Japan's fate is sealed because much to Japan's dismay, "junk" bonds are called that for a reason.

Peak Japaganda: Advisers Call For More QE (But Admit Failure Of QE); China's Yuan Hits 3-Week High

Asian markets are bouncing modestly off a weak US session, buoyed by more unbelievable propaganda from Japan. Abe's proclamations that "deflationary mindset" has been shrugged off was met with calls for more stimulus, more debt monetization, and an admission by Etsuro Honda (Abe's closest adviser) that Japan "is not growing positively" and more QE is required despite trillions of Yen in money-printing having failed miserably, warning that raising taxes to pay for extra budget "would be suicidal." Japanese data was a disaster with factory output unexpectedly dropping 0.5% and retail trade missing. Markets are relatively stable at the open as China margin debt drop sto a 9-month low. PBOC strengthened the Yuan fix for the 3rd day in a row to its strongest in 3 weeks.