I guess that ZeroHedge has been right for the past four years; QE Infinity was the endgame, and it most certainly is. The only thing next is “how much”. And after the “stimulus” doubles and doubles again, the markets will be so sated that they won’t move higher. Then comes the inevitable collapse.
But until then, financial firms will lever themselves 100:1 with MBS paper and commodities until there is nobody left to buy.
Even though many “stimulus sensitive” stocks are up 10-20% in the week previous to the FED’s announcement, there is nobody, and I mean nobody who suggests to fight the FED even now and in the foreseeable future.
Simple things like “supply & demand” and other quaint economic facts go out the window. Prices rise because of Free Money destined only for “assets”. Fuck everyone else. Don’t worry that the government will run out of money, the FED can print all it needs. I wonder when Congress will figure this out and print for themselves.
It is an historic event in the history of Capitalism and Free Markets because it is the time when it is no longer “officially” Capitalism and Free Markets. Certainly you cannot argue that fact.
In a Twitter stream of consciousness, I posted the following after the FED’s announcement. It’s obvious that I tweet too much…
BIG OIL & BANKERS ARE PRIMARY BENEFICIARIES OF OBAMA PRESIDENCY
Money for banks & government only. NO MONEY FOR YOU!
$40 B a month? That’s not even the MONTHLY DEFICIT
THIS DOESN’T HELP THE ECONOMY. IT ONLY HELPS BANKS WITH SHITTY MBS PAPER
will someone send me couple of thousand a month for MY mortgage?
sell stocks/buy the shittiest MBS paper you can find. MAGNATAR where are you?
YOU WONDER IF THIS HELPS BANKS? LOOK AT THEM!
Political FED? Nah….lolz
OPEN-ENDED IS THE ENDGAME
we’re gonna need Volker again when Bernanke gets done…
It’s not WHAT you know, its WHO you know. At the FED
THIS THE MOST IMPORTANT DAY IN THE FOUR YEARS SINCE THE CRASH. THE ENDGAME OF OPEN-ENDED QE. Dow 15k next
THE FED WILL BE ALL THE DEMAND YOU WILL NEED for anything financial. God Bless America
“Brain Dead Long Only” through thick and thin? Bernanke has again made you a genius. Congrats!
I dont know even one person who thinks or would bet that the market could or would go down
And this Gaping Open Ended stimulus is the last bullet. All they can do is print more until they own everything
POMO of $4 billion a day this year and $2 billion a day forevermore. Incredable
Government printing money to by financial assets from investors. This is clearly the greatest scam ever perpetrated anywhere ever
Government in danger of a shutdown. They need to cut trillion dollars from the budget. And the FED just promised unlimited cash to markets
There is something SO WRONG with this picture!
Bernanke has assured that Wall Street will NEVER expect an economic recovery. Free money trumps recovery
If Greenspan knew how easy it would be to juice the market with Free Money we would have certainly peaked at Dow 30k
There is not one person, not one investor, not one publication, not one biz media entity that believes that the market can or will go down
soon, very very soon, the price of commodities will absolutely choke 99% of the economy and its participants
So, Bernanke would clearly rather have higher asset prices vs. a growing economy. In fact he has now “stripped the gears”
Next year the monthly POMO outlay will be doubled. The following year it will double again.
Supply & demand equilibrium will be suspended. Commodity prices will levitate where few will buy, yet prices will continue be “overpriced
It is a scam of the highest order. It will be remembered as the largest looting of wealth in human history. Shame
There will never be a day of reckoning until we are dead and gone.
Free Money Forever is the most important invention since the creation of currency
Let me repeat: Open-Ended is the endgame. Now its just how much till the end…
Banks: “Help us, we lost 4 trillion dollars!”. Bernanke: “OK, here’s the money”
Greenspan is kicking himself that he should have been doing this money printing every month since 1987
Soon you will hear (unchallenged) the ASSHOLES on TV that will tell you that commodity prices r rising because of demand from China & India
So lets roll em up and smoke em. Enjoy!
So there! By the time Ma & Pa get around to believing the markets, the Algos will only be too happy to sell. Have a safe and happy weekend!
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Some of those would make great bumper sticker or t-shirt sayings.
indued
Nice post Scott
What he said.
I enjoy your snark on the Twitter, but this is better.
What a great post. Everything is now so dysfunctionaltastic!
Ready for a dumb question? When will we know mom and pop are in? What are the EARLY signs and symptoms of the retail and other investors coming back in strong?
This is the absolute truth. My dad who buys highs and capitulates on lows, called me today to tell me he was going into market on Monday, I said please let me know what you will buy,i want to short it..He is absolutely a bottom tick in markets and can top tick markets within a week to two weeks. Like clockwork…
Scott, I’d like to see a detailed transaction based account of how the Fed increases the money supply via QE. They take some cash and buy a MBS. The person who had a MBS now has cash. You could argue that the net amount of purchasable assets has decreased, therefore all assets should go up. You could also argue that there are certain accounting rules related to MBS (mark to model) that is somewhat of a backdoor bailout of crappy securities, as you end up getting cash equal to what your model says the MBS is worth. But, I don’t see anything within the Fed’s transactions in QE that actually increases the money supply. The only way I know of is if the recipient of the cash lends it out. Which would be the banks increasing the money supply, not the Fed. In fact, I don’t see anything other than the perception that they are printing money, that should actually increase asset prices.
But, I’m sure higher asset prices that effectively bail out every unfunded state, municipal and private sector pension plan won’t trickle down into the economy.
And of course, fundamentals don’t matter any more…
http://dynamichedge.com/wp-content/uploads/2012/06/initial_claims_vs_spx.png
the beatings will continue until moral improves. the fed.
Or ..”Commodity prices are rising because of speculators and hedge funds.”
Separately, it’s interesting how long-dated treasuries and the $DXY have persistently plunged together this time; I’m too humble to predict that this is the end game, but it seems to me that this is one of the things that one will see when it comes.
Inevitable collapse? Hardly. If the CDS market collapse didn’t take the market down, what will? Answer: Nothing will.
The level of control the privately-owned 162 central banks have is total and complete. Their communitarian political agenda is hardly a secret, unless you depend on their mainstream propaganda for your information. Watch world communitarianism unfold before your eyes as the markets are kept afloat, and the aspects that are allowed to degenerate represent the obstacles to the communitarian agenda.
Total and complete control. This includes control over the near-total ignorance of the general public, which looks to the propaganda media machine to deterrmine what reality is.
Watch stuff go up, make kleptocrat money from the algos, take profits, buy more precious metals, not hard. QE to infinity = death of fiat, everyone’s gonna print in a full retard race to the bottom. These crooks got so greedy that they’re forcing a debt jubilee for trying to bilk every last cent of wealth from the system