Legendary Jim Grant claims the "liquidity problem" is actually a problem of too much available collateral (debt in the form of bills, notes, bonds of the US government) sucking up all of the "liquidity."
@cohodk said:
I wish the PANIC would hurry up. I wanna buy some productive assets on the cheap.
You mean this sh!t storm still in effect? Man I thought relief was coming soon, this gonna last more than another 3 months? This is worse than climate change, could the markets fold up in months or a couple years? How long will a pallet of whiskey last? Or will I need any W mintmarked gold coins to survive? Man I think I got some top ramen somewhere, dang gonna need toilet paper...
LOL. Of course not. You're reading an opinion piece from the guy who was a FED president throughout the entire QE process (you know, when the FED balance sheet of debt went from less than $1 trillion to over $4 trillion). He left the FED in 2018 to become one of their cheerleaders in the press. Appears your sources aren't so impeccable after all.
Keep an open mind, or get financially repressed -Zoltan Pozsar
Sounds like a voice of reason to me. And helped lay the foundation for one of the longest economic expansions in US history. Youre blackened glasses are doing a good job of keeping the sun from your eyes?
@cohodk said:
I wish the PANIC would hurry up. I wanna buy some productive assets on the cheap.
You mean this sh!t storm still in effect? Man I thought relief was coming soon, this gonna last more than another 3 months? This is worse than climate change, could the markets fold up in months or a couple years? How long will a pallet of whiskey last? Or will I need any W mintmarked gold coins to survive? Man I think I got some top ramen somewhere, dang gonna need toilet paper...
Butter and beans here, I hope you are all prepared, big fed panic can only mean blood in the streets.
Gold oh yeah, Jim is correct better git sum now! I cant eat it or wipe my backside with it but sure will be pretty to look at when the system finally collapses. lol
"Let us remind CNBC viewers what 2019 is actually shaping up to be: it’s the year that the highest priced stock in the price-weighted Dow Jones Industrial Average, Boeing, can’t figure out how to safely fly the plane, the 737 Max, that it has sold to airlines around the world. The stock charts of two of the biggest IPOs of the year, Uber and Lyft, look like crash landings themselves."
Keep an open mind, or get financially repressed -Zoltan Pozsar
@cohodk said:
Sounds like a voice of reason to me. And helped lay the foundation for one of the longest economic expansions in US history. Youre blackened glasses are doing a good job of keeping the sun from your eyes?
It has been a false "economic expansion" since 2008. Had the faltering entities been allowed to wash out, and the bad debts to be defaulted and/or liquidated, then there would have been a true economic expansion after 2008 (see Iceland for an example). But those at the top just won't let the debt structures collapse. As a result the economic foundation is as wobbly as ever, while the house built on top of it is propped up by more and more straws.
The ultimate force in economics is demographics. A debt-based monetary system works fine when there is a growing population (a continuous flow of new blood taking on debt). But when population growth slows, a debt-based economic system falls on its face. Europe currently has the lowest population growth rate (maybe even a decline in some areas). And as a result, they have negative interest rates. The ultimate problem is, at some point the Earth will no longer be able to support any additional growth in the human population. Eventually the debt will have to be defaulted, liquidated, and/or monetized en masse. We are seeing the early signs of this effect now.
In terms of quality of life for everyone It would be best to establish a stable human population (minimal increase, minimal decrease). To achieve that, the debt-based monetary system eventually has to be abandoned.
In terms of quality of life for everyone It would be best to establish a stable human population (minimal increase, minimal decrease). To achieve that, the debt-based monetary system eventually has to be abandoned.
Yup, with real money that can't be poofed into existence.
at some point the Earth will no longer be able to support any additional growth in the human population. Eventually the debt will have to be defaulted, liquidated, and/or monetized en masse.
...or the human population will have to be liquidated en masse. It's scientific fact that various species experience widespread depopulation when their environment cannot support continued growth in their population.
The planners are busy planning - as long as it's not their ass on the line.
Q: Are You Printing Money? Bernanke: Not Literally
Eventually. Yup. Eventually. When is eventually dcarr? Do we prepared for the end of human life now, tomorrow,or in 100years? Or just practice prudence without emotional influence?
False expansion. Lol. Yup. Its false. All fake news. Haha.
@dcarr said: "The ultimate force in economics is demographics. A debt-based monetary system works fine when there is a growing population (a continuous flow of new blood taking on debt). But when population growth slows, a debt-based economic system falls on its face. Europe currently has the lowest population growth rate (maybe even a decline in some areas). And as a result, they have negative interest rates. The ultimate problem is, at some point the Earth will no longer be able to support any additional growth in the human population. Eventually the debt will have to be defaulted, liquidated, and/or monetized en masse. We are seeing the early signs of this effect now."
I agree with parts of this, and disagree with other parts.
"The ultimate force in economics is demographics"
I agree that it is impossible to understand an economy without having a deep understanding of the underlying demographics -- which includes not just age and wealth distributions, but also the cultural aspects of a society. In fact, one of the biggest flaws in much of modern macroeconomic theory is that it tends to apply a very broad brush, almost ignoring the implications of demographic factors.
"A debt-based monetary system works fine when there is a growing population (a continuous flow of new blood taking on debt). But when population growth slows, a debt-based economic system falls on its face."
I don't agree with this, if you mean to imply that debt is inconsistent with a steady state demographic situation. Certainly in an economy that is growing (due, for example, to a growing population and other factors), it is easy for institutions to take on increasing levels of debt. This may be debt that is explicitly recorded as debt, or other obligations, like pension liabilities, that are in the nature of debt. This can definitely lead to a collapse of the nature you are describing. However, it is not inevitable.
"Europe currently has the lowest population growth rate (maybe even a decline in some areas). And as a result, they have negative interest rates"
It is very tempting to draw this conclusion (i.e,, population decline leads to negative interest rates). I have been dabbling on this thesis for about ten years! But, there are a lot of other factors, such as the impact of globalization and technology. For the fun of it, don't forget Japan, which has had a declining working age population for many years, and now has a declining overall population. Given Japan's notable demographics, the economy here is actually remarkably dynamic. Come visit if you don't believe me.
"The ultimate problem is, at some point the Earth will no longer be able to support any additional growth in the human population. Eventually the debt will have to be defaulted, liquidated, and/or monetized en masse. We are seeing the early signs of this effect now."
I agree that it may be challenging for countries that have high debt obligations and low or negative population growth to pay off those obligations. But, I would emphasize that debt has an important function in a steady state economy. Behavior is the issue, not the debt. I suspect that Japan and many European countries have an adequate depth of social capital to deal with the current apparent debt issues they face.
False expansion. Lol. Yup. Its false. All fake news. Haha.
I'd be interested in your assessment of the liquidity shortage in the repo market.
Why not just raise rates and stop supplying all this extra keystroked money to people who decided to go way out on a limb at our expense? Why should we taxpayers and working stiffs finance their bad financial decisions that were motivated only by greed?
Q: Are You Printing Money? Bernanke: Not Literally
@jmski52 said: False expansion. Lol. Yup. Its false. All fake news. Haha.
I'd be interested in your assessment of the liquidity shortage in the repo market.
Why not just raise rates and stop supplying all this extra keystroked money to people who decided to go way out on a limb at our expense? Why should we taxpayers and working stiffs finance their bad financial decisions that were motivated only by greed?
Im on record for the netter part of a decade saying we would be better with higher interest rates. This supposed panic in the repo market is a function of govt regulation and negative interest rates. All easily fixed by allowing banks to be banks (rather than utilities) and abstaining from negative or zero interest rates. There is no panic. Banks dont want negative rates, but politicians do.
@jmski52 said:
Whether or not the Fed is in a panic, the Fed is not your friend. Not even yours, Baley.
Of course not. Neither are the police, the IRS, nor my homeowners association board. Who said they were, or should be?
They work for the common good, and as a responsible citizen, i trust them to do their effin jobs
I just go on my merry way and mind my own damned business, and so do they. I realize that there are some who obsess over them, but I'm not one of those people.
I do get that some folks feel that I'm stupid for being generally happy for not being continually OUTRAGED by all the thems in the world.. they shouldn't worry about me, I'm doing just fine 😉
LOL. Of course not. You're reading an opinion piece from the guy who was a FED president throughout the entire QE process (you know, when the FED balance sheet of debt went from less than $1 trillion to over $4 trillion). He left the FED in 2018 to become one of their cheerleaders in the press. Appears your sources aren't so impeccable after all.
@jmski52 said: In terms of quality of life for everyone It would be best to establish a stable human population (minimal increase, minimal decrease). To achieve that, the debt-based monetary system eventually has to be abandoned.
Yup, with real money that can't be poofed into existence.
at some point the Earth will no longer be able to support any additional growth in the human population. Eventually the debt will have to be defaulted, liquidated, and/or monetized en masse.
...or the human population will have to be liquidated en masse. It's scientific fact that various species experience widespread depopulation when their environment cannot support continued growth in their population.
The planners are busy planning - as long as it's not their ass on the line.
If you haven't read "Collapse", itis an interesting book I read that details various societies that have collapsed. You can find it used on eBay for under $5:
I wasn't paying enough attention to the fed's post-fomc q&a. i think they are going to continue to do repos into january and some temporary omo for what i think is additional reserves to a level they perceive as better into 2Q next year.
one thing I did get was they don't have an explanation for the secondary repo market tightening up back then but are investigating it.
@derryb said:
Munchkin (sp, lol) says they will also be easing reserve requirements, something that was increased to protect us from bad banks.
There you go problem solved, well I guess the panic is now officially over, thank you all for participating and if you lost your ass it’s your fault...
Sven Henrich, NorthmanTrader.com: Fed balance sheet now north of $4 trillion again increasing by over $261 billion in just 2 months. That's $1.566 trillion on an annualized basis. But remember it's not QE because the Fed said so.
Keep an open mind, or get financially repressed -Zoltan Pozsar
Comments
FED balance sheet up one quarter of a trillion dollars in just 42 days!
But, according to FED president, it's not QE.
Let's just call it QE4ever.
Keep an open mind, or get financially repressed -Zoltan Pozsar
Legendary Jim Grant claims the "liquidity problem" is actually a problem of too much available collateral (debt in the form of bills, notes, bonds of the US government) sucking up all of the "liquidity."
Jim Grant: The Problem Isn’t Liquidity, It’s Debt
Runaway federal spending is now completely driving monetary policy. It has always been a debt problem.
Keep an open mind, or get financially repressed -Zoltan Pozsar
Man how can one guy be so smart and not in any government office? Or running any of the Fortune 500 companies? Amazing...
or hiding under an anonymous name on a nickle and dime and quarter and dollar forum
Keep an open mind, or get financially repressed -Zoltan Pozsar
I wish the PANIC would hurry up. I wanna buy some productive assets on the cheap.
Knowledge is the enemy of fear
Bizzarro World: When a FED panic creates a stock buying frenzy. LOL
Keep an open mind, or get financially repressed -Zoltan Pozsar
You mean this sh!t storm still in effect? Man I thought relief was coming soon, this gonna last more than another 3 months? This is worse than climate change, could the markets fold up in months or a couple years? How long will a pallet of whiskey last? Or will I need any W mintmarked gold coins to survive? Man I think I got some top ramen somewhere, dang gonna need toilet paper...
https://finance.yahoo.com/news/longer-term-lessons-repo-turmoil-090029866.html
Not reading any panic here.
Knowledge is the enemy of fear
LOL. Of course not. You're reading an opinion piece from the guy who was a FED president throughout the entire QE process (you know, when the FED balance sheet of debt went from less than $1 trillion to over $4 trillion). He left the FED in 2018 to become one of their cheerleaders in the press. Appears your sources aren't so impeccable after all.
Keep an open mind, or get financially repressed -Zoltan Pozsar
Sounds like a voice of reason to me. And helped lay the foundation for one of the longest economic expansions in US history. Youre blackened glasses are doing a good job of keeping the sun from your eyes?
Knowledge is the enemy of fear
irrational exuberance
Keep an open mind, or get financially repressed -Zoltan Pozsar
Butter and beans here, I hope you are all prepared, big fed panic can only mean blood in the streets.
Gold oh yeah, Jim is correct better git sum now! I cant eat it or wipe my backside with it but sure will be pretty to look at when the system finally collapses. lol
The whole worlds off its rocker, buy Gold™.
What are they smoking at CNBC?
"Let us remind CNBC viewers what 2019 is actually shaping up to be: it’s the year that the highest priced stock in the price-weighted Dow Jones Industrial Average, Boeing, can’t figure out how to safely fly the plane, the 737 Max, that it has sold to airlines around the world. The stock charts of two of the biggest IPOs of the year, Uber and Lyft, look like crash landings themselves."
Keep an open mind, or get financially repressed -Zoltan Pozsar
Seriously, thats the kind of hyperbolic nonsense that keeps you going?
Very sad. So warped. So manipulated.
Knowledge is the enemy of fear
It has been a false "economic expansion" since 2008. Had the faltering entities been allowed to wash out, and the bad debts to be defaulted and/or liquidated, then there would have been a true economic expansion after 2008 (see Iceland for an example). But those at the top just won't let the debt structures collapse. As a result the economic foundation is as wobbly as ever, while the house built on top of it is propped up by more and more straws.
The ultimate force in economics is demographics. A debt-based monetary system works fine when there is a growing population (a continuous flow of new blood taking on debt). But when population growth slows, a debt-based economic system falls on its face. Europe currently has the lowest population growth rate (maybe even a decline in some areas). And as a result, they have negative interest rates. The ultimate problem is, at some point the Earth will no longer be able to support any additional growth in the human population. Eventually the debt will have to be defaulted, liquidated, and/or monetized en masse. We are seeing the early signs of this effect now.
In terms of quality of life for everyone It would be best to establish a stable human population (minimal increase, minimal decrease). To achieve that, the debt-based monetary system eventually has to be abandoned.
In terms of quality of life for everyone It would be best to establish a stable human population (minimal increase, minimal decrease). To achieve that, the debt-based monetary system eventually has to be abandoned.
Yup, with real money that can't be poofed into existence.
at some point the Earth will no longer be able to support any additional growth in the human population. Eventually the debt will have to be defaulted, liquidated, and/or monetized en masse.
...or the human population will have to be liquidated en masse. It's scientific fact that various species experience widespread depopulation when their environment cannot support continued growth in their population.
The planners are busy planning - as long as it's not their ass on the line.
I knew it would happen.
Eventually. Yup. Eventually. When is eventually dcarr? Do we prepared for the end of human life now, tomorrow,or in 100years? Or just practice prudence without emotional influence?
False expansion. Lol. Yup. Its false. All fake news. Haha.
Knowledge is the enemy of fear
Does the US have a declining population? What is the average age in the US? How does this compare to the rest of the world?
Knowledge is the enemy of fear
Repo is just the beginning.
Shadow banking is the next domino.
Keep an open mind, or get financially repressed -Zoltan Pozsar
Folks who live in panic and fear are so easily manipulated.
Knowledge is the enemy of fear
What panic looks like. If your hypothesis is correct we should see the FED give in to the Donald's interest rate wishes.
Keep an open mind, or get financially repressed -Zoltan Pozsar
Your idea of panic is infantile.
Boo!!!
Knowledge is the enemy of fear
@dcarr said: "The ultimate force in economics is demographics. A debt-based monetary system works fine when there is a growing population (a continuous flow of new blood taking on debt). But when population growth slows, a debt-based economic system falls on its face. Europe currently has the lowest population growth rate (maybe even a decline in some areas). And as a result, they have negative interest rates. The ultimate problem is, at some point the Earth will no longer be able to support any additional growth in the human population. Eventually the debt will have to be defaulted, liquidated, and/or monetized en masse. We are seeing the early signs of this effect now."
I agree with parts of this, and disagree with other parts.
"The ultimate force in economics is demographics"
I agree that it is impossible to understand an economy without having a deep understanding of the underlying demographics -- which includes not just age and wealth distributions, but also the cultural aspects of a society. In fact, one of the biggest flaws in much of modern macroeconomic theory is that it tends to apply a very broad brush, almost ignoring the implications of demographic factors.
"A debt-based monetary system works fine when there is a growing population (a continuous flow of new blood taking on debt). But when population growth slows, a debt-based economic system falls on its face."
I don't agree with this, if you mean to imply that debt is inconsistent with a steady state demographic situation. Certainly in an economy that is growing (due, for example, to a growing population and other factors), it is easy for institutions to take on increasing levels of debt. This may be debt that is explicitly recorded as debt, or other obligations, like pension liabilities, that are in the nature of debt. This can definitely lead to a collapse of the nature you are describing. However, it is not inevitable.
"Europe currently has the lowest population growth rate (maybe even a decline in some areas). And as a result, they have negative interest rates"
It is very tempting to draw this conclusion (i.e,, population decline leads to negative interest rates). I have been dabbling on this thesis for about ten years! But, there are a lot of other factors, such as the impact of globalization and technology. For the fun of it, don't forget Japan, which has had a declining working age population for many years, and now has a declining overall population. Given Japan's notable demographics, the economy here is actually remarkably dynamic. Come visit if you don't believe me.
"The ultimate problem is, at some point the Earth will no longer be able to support any additional growth in the human population. Eventually the debt will have to be defaulted, liquidated, and/or monetized en masse. We are seeing the early signs of this effect now."
I agree that it may be challenging for countries that have high debt obligations and low or negative population growth to pay off those obligations. But, I would emphasize that debt has an important function in a steady state economy. Behavior is the issue, not the debt. I suspect that Japan and many European countries have an adequate depth of social capital to deal with the current apparent debt issues they face.
False expansion. Lol. Yup. Its false. All fake news. Haha.
I'd be interested in your assessment of the liquidity shortage in the repo market.
Why not just raise rates and stop supplying all this extra keystroked money to people who decided to go way out on a limb at our expense? Why should we taxpayers and working stiffs finance their bad financial decisions that were motivated only by greed?
I knew it would happen.
I guess tonight I'm gonna panic like its 1999. God save the Fed. Semper Fi! lol
The whole worlds off its rocker, buy Gold™.
@blitzdude
Sidebar...……...psssst……..(the Fed is not your friend).
Just sayin'.
I knew it would happen.
Im on record for the netter part of a decade saying we would be better with higher interest rates. This supposed panic in the repo market is a function of govt regulation and negative interest rates. All easily fixed by allowing banks to be banks (rather than utilities) and abstaining from negative or zero interest rates. There is no panic. Banks dont want negative rates, but politicians do.
Knowledge is the enemy of fear
Politicians want what they are told to want, normally by bankers.
Keep an open mind, or get financially repressed -Zoltan Pozsar
Politicians want what they are told to want, normally by bankers.
One hand washes the other.
I knew it would happen.
Using words like panic, destroy, collapse and similar hyperbole does not tend to strengthen arguments against the dollar or Fed
Liberty: Parent of Science & Industry
Whether or not the Fed is in a panic, the Fed is not your friend. Not even yours, Baley.
I knew it would happen.
Michael Pento: "Fed panics & starts massive money printing."
Pento says the Fed is panicking to stop a “depression.”
Keep an open mind, or get financially repressed -Zoltan Pozsar
repo operations continue in an expanded fashion.
Thursday, 10/24/2019 - Thursday, 11/14/2019 At least $120 billion
note the wording is now "at least"
https://www.newyorkfed.org/markets/domestic-market-operations/monetary-policy-implementation/repo-reverse-repo-agreements/repurchase-agreement-operational-details
there will also be 14day term repos of at least $35 billion each.
so far, the expanded repos are under subscribed.
Of course not. Neither are the police, the IRS, nor my homeowners association board. Who said they were, or should be?
They work for the common good, and as a responsible citizen, i trust them to do their effin jobs
I just go on my merry way and mind my own damned business, and so do they. I realize that there are some who obsess over them, but I'm not one of those people.
I do get that some folks feel that I'm stupid for being generally happy for not being continually OUTRAGED by all the thems in the world.. they shouldn't worry about me, I'm doing just fine 😉
Liberty: Parent of Science & Industry
You're hero just flip-flopped. Looks like he's in the "panic" crowd now.
Keep an open mind, or get financially repressed -Zoltan Pozsar
don't panic about panicking until we're sure we need to panic
is that big jump slowing considerably? flattening out? perhaps, perhaps not. have to wait and see.
(each segment of the line is 1 week)
Well, who hired the politicians? What, we only have a voice for one day every other year? We are weak.
Knowledge is the enemy of fear
If you haven't read "Collapse", itis an interesting book I read that details various societies that have collapsed. You can find it used on eBay for under $5:
https://en.wikipedia.org/wiki/Collapse:_How_Societies_Choose_to_Fail_or_Succeed
https://www.ebay.com/sch/i.html?_from=R40&_trksid=p2380057.m570.l1313.TR1.TRC0.A0.H0.XCollapse:+How+Societies+Choose+to+Fail+or+Succeed.TRS0&_nkw=Collapse:+How+Societies+Choose+to+Fail+or+Succeed&_sacat=0
I wasn't paying enough attention to the fed's post-fomc q&a. i think they are going to continue to do repos into january and some temporary omo for what i think is additional reserves to a level they perceive as better into 2Q next year.
one thing I did get was they don't have an explanation for the secondary repo market tightening up back then but are investigating it.
Munchkin (sp, lol) says they will also be easing reserve requirements, something that was increased to protect us from bad banks.
Keep an open mind, or get financially repressed -Zoltan Pozsar
Still trying to figure out who's panicking (other than the OP)? lol.
The whole worlds off its rocker, buy Gold™.
There you go problem solved, well I guess the panic is now officially over, thank you all for participating and if you lost your ass it’s your fault...
I think he meant picnic.
Knowledge is the enemy of fear
Liberty: Parent of Science & Industry
FED gone wild (again).
Sven Henrich, NorthmanTrader.com: Fed balance sheet now north of $4 trillion again increasing by over $261 billion in just 2 months. That's $1.566 trillion on an annualized basis. But remember it's not QE because the Fed said so.
Keep an open mind, or get financially repressed -Zoltan Pozsar
Wish they'd "panic" the price of gold and silver a bit higher. lol
The whole worlds off its rocker, buy Gold™.
this is now reserve balances they are targeting. allegedly this is temporary. I think I recall them saying this will last into Q2 next year.
One might ask himself, "why is this even necessary?"
Can't the economy function without bank intervention?
I knew it would happen.