<< <i>They'll likely taper off $10B every month or two, with the goal of being done buying new bonds by the end of 2014. >>
I agree that is likely the plan. Knock it down by $10B every other month through 2014. Of course when a correction in the equity markets appears imminent, the whole thing will be cranked back up just like 2011, 2012, & 2013. Or as derryb noted, they could modify the program and provide us with a new name. Twist & Shout? Perhaps those of us at the CU Precious Metals forum could provide some input to The Fed regarding an appropriate name for their next stimulus program? Any ideas fellas?
It seems to me that history will treat Bernanke well when you look back at the financial crisis. Central bankers have long careers and try as much as possible to stay out of politics as sooner or later the other party will be in power. Much of what was done was not popular, but using the tools available to them, the Treasury and Fed have done their best to avoid deflation while pulling us out of a massive recession that was near depression levels. I notice jobs are on the rise today and the economy is still the stingiest in the world. Our GDP is well ahead of Europe.
Now I know this is a forum populated by folks who have contrarian views of the central bankers and metals have taken a beating the past year while equities have risen sharply. IMHO Janet Yellen will continue the current policies and it has nothing to do with who sits in the oval office. Remember, Bernanke was put in by Bush. In four years the next president will then have a choice as well regarding the Fed chair. Greenspan worked well past the normal retirement age, but will Yellen want to stay if invited. And who is making the call will also have some implications regarding the invitation to stay.
Retired United States Mint guy, now working on an Everyman Type Set.
<< <i>It seems to me that history will treat Bernanke well when you look back at the financial crisis. >>
Doubt it. The inevitable unraveling of equity valuations and more importantly skyrocketing interest rates and inflation will taint the Bernanke legacy. Certainly not entirely his fault as Congress and the administration has continued to deal him a losing hand.
I believe that interest rates are at all time lows. I have been around long enough to have experienced 14 percent mortgage rates in the 80s. The problem is more trying to stave of deflation, rather than any inflation problems right now. One of the reasons the Fed is using QE is that interest rates are effectively zero. They cannot lower them to stimulate the economy. If inflation were an issue, interest rates would be much higher and the usual central banking tools of lowering interest rates would be available in order to dig us out of the deep recession.
Retired United States Mint guy, now working on an Everyman Type Set.
<< <i>One of the reasons the Fed is using QE is that interest rates are effectively zero >>
Short term rates are zero because that is where Big Ben set them 5 years ago. He has much less control over longer rates such as the 10 and 30 year which are much more market driven. In the last year, as Bernanke and his GS friends frantically gobbled up $85B a month of paper, the ten year rate jumped over 100 basis points, which was confusing to Bernanke and he stated as much.
Bernanke is an academic scholar with little real world experience, at least when he became Fed Chair.
Please reconsider your view that inflation is not an issue. 6-8% real inflation rate is my best estimate. Government though tells me that my new $600 computer was $6000 ten years ago so the $5400 price drop offsets the 7% rises in food, energy, cable and medical in 2013.
"Not only did it prevent another Great Depression, we've been told, but the money has all been paid back, and the government even made a profit. No harm, no foul – right?
Every day, I wake up and shout "Earthquake!, today's going to be the Big Earthquake, so prepare yourselves! prepare, for you are forwarned!"
One of these days, we'll have a big earthquake, and I'll say, "See! I was right all along, just early!"
Every day, I wake up and have a coffee. Then I observe to myself that nothing has really changed, in terms of policy and trends. Nor has my opinion changed that current policies are getting us into real trouble with debt, spending and their impacts on our culture and way of living. Too much dependency. Too much laziness. Too many excuses for bad behavior.
It's clear that the US economy is big enough and robust enough to take a lot of shocks and keep on rumbling down the road. What's not clear is how much overburden can be heaped on the people who perform actual work in producing the stuff before all bets are off. It's really not about interest rates or stock market performance. It's about production and consumption.
We've seen this movie before, unfortunately.
Q: Are You Printing Money? Bernanke: Not Literally
I concur regarding the consumption and production comments above. I would add that if we can just stop fighting wars it would do amazing things to our deficits. War is inordinately expensive, and continuous wars tend to create a culture of bloated Defense budgets that become sacrosanct over time. Some of the prosperity of the 90s was due to the fact that we did not write the check for the first Gulf War.
Balancing the budget needs both entitlement reform as well as reduction in military spending. There is no magic bean and neither party has the answer on their own. Perhaps the word compromise could return to our lexicon, but I have little hope for that in the present environment.
It is most interesting to have Eisenhower's Cross of Iron speech read by incoming first year college students and to see their take on what it says without revealing either the date or the author before the discussion and then revealing who said it, when and his affiliation. You would be amazed by the answers, which also speaks to the current educational system as virtually none of them had heard of it before the class.
Retired United States Mint guy, now working on an Everyman Type Set.
I'd never heard of that speech. You're right. It should be broadcast worldwide, at least once a year. And Eisenhower is the perfect one to have given that speech.
Q: Are You Printing Money? Bernanke: Not Literally
<< <i>I believe that interest rates are at all time lows. I have been around long enough to have experienced 14 percent mortgage rates in the 80s. The problem is more trying to stave of deflation, rather than any inflation problems right now. One of the reasons the Fed is using QE is that interest rates are effectively zero. They cannot lower them to stimulate the economy. If inflation were an issue, interest rates would be much higher and the usual central banking tools of lowering interest rates would be available in order to dig us out of the deep recession. >>
Nice post , I agree completely, but that understanding is lost on many, certainly the majority of the "true believers of all that is gold", imo. Although inflation will always come around again, it is not the battle most mature economies are facing now. Deflation is still the bigger concern for most of Europe and the US as of now.
Zero Interest Rate Policy results in the destruction of capital, and keeps the markets from self-correcting. Giving free money to poorly-run banks and poorly-run companies owned by political cronies isn't the way to stimulate an economy. The "deflation" we're experiencing is only the transfer of wealth from the middle class to the bankers via socialization of TBTF gambling debts. And frankly, something's rotten in Denmark.
Q: Are You Printing Money? Bernanke: Not Literally
It seems to me the fed will do QE to infinity to stop the DOW from going back to 6500 that occurred in March 09, no matter what the consequences or until it has lost complete control. It will never be "hands off" the economy, this is obvious.
I would go back into the stock market, but its a game of musical chairs right now. I would not know when to pull out of it again. Right now have about 10% of my assets in the market. At least I have 100% control of my previous company 401k now rolled over to an IRA since Jan 2013.
The feds handiwork over the last 5 years may well return the Dow to 6500. Nothing is free in this universe, particularly money. As a quadrupling of the money supply has been generated, interest rates will soon soar, with or without intervention. At 10% bond yields, the 1.85% dividend yield on the SP500 will look like a party favor, and the Dow will plunge to realign to a reasonable dividend return.
BTW, the last two days of stock trading has shown much volatility, albeit in a relatively narrow range. Looks like the buy the dip guys are doing what they do best, then the market flattens back and they try it again. Unlike the last year, there is little upside follow through.
Friday brings the employment numbers which will be a no win for equities. High number and interest rates pop, low numbers and Nasdaq gets panicky. Look for a 300 plus point drop on the downside by the end of trading.
The feds handiwork over the last 5 years may well return the Dow to 6500. Nothing is free in this universe, particularly money. As a quadrupling of the money supply has been generated, interest rates will soon soar, with or without intervention. At 10% bond yields, the 1.85% dividend yield on the SP500 will look like a party favor, and the Dow will plunge to realign to a reasonable dividend return.
BTW, the last two days of stock trading has shown much volatility, albeit in a relatively narrow range. Looks like the buy the dip guys are doing what they do best, then the market flattens back and they try it again. Unlike the last year, there is little upside follow through.
Friday brings the employment numbers which will be a no win for equities. High number and interest rates pop, low numbers and Nasdaq gets panicky. Look for a 300 plus point drop on the downside by the end of trading. >>
Who is your Swami? I hope it's not the same one that JS has been using for the last several years. I suppose we'll find out by tomorrow if you are blowing hot air or have a decent fortune teller. My guess, more hot air.
"Bongo drive 1984 Lincoln that looks like old coin dug from ground."
official employment numbers are meaningless when released. Why else would that have to always revise them later? Keep it simple. What percentage of the population has a full time job, period. All they have to do is check with the IRS who keeps track of payroll tax deductions.
The feds handiwork over the last 5 years may well return the Dow to 6500. Nothing is free in this universe, particularly money. As a quadrupling of the money supply has been generated, interest rates will soon soar, with or without intervention. At 10% bond yields, the 1.85% dividend yield on the SP500 will look like a party favor, and the Dow will plunge to realign to a reasonable dividend return.
BTW, the last two days of stock trading has shown much volatility, albeit in a relatively narrow range. Looks like the buy the dip guys are doing what they do best, then the market flattens back and they try it again. Unlike the last year, there is little upside follow through.
Friday brings the employment numbers which will be a no win for equities. High number and interest rates pop, low numbers and Nasdaq gets panicky. Look for a 300 plus point drop on the downside by the end of trading. >>
Well, let's see ...10 year note at 2.90% ( big overnight drop) the DOW & NASDAQ are in positive territories... Time to reanalyze your crystal ball. btw the PM's are also mostly on the up side. Granted, these are early calls, which may change during the course of the day, but unlikely to your gloomy scenario.
"Bongo drive 1984 Lincoln that looks like old coin dug from ground."
<< <i>the DOW & NASDAQ are in positive territories... Time to reanalyze your crystal ball. >>
Generally not wise to judge a market before the days trading has concluded. We are a bit negative now.
I do not consider a 300 point drop to be gloomy, I consider it healthy. Probably too late in the game for a "healthy" correction though as the balloon is taut and will not deflate well.
<< <i>the DOW & NASDAQ are in positive territories... Time to reanalyze your crystal ball. >>
Generally not wise to judge a market before the days trading has concluded. We are a bit negative now.
I do not consider a 300 point drop to be gloomy, I consider it healthy. Probably too late in the game for a "healthy" correction though as the balloon is taut and will not deflate well. >>
Once again, I totally disagree with your assessment and I've been in the market since the late 60's. Yes, a correction will occur, like it has in the past and will in the future, but only when the market becomes frothy, which in my opinion is based on earnings or speculative returns, it's not at this point.
"Bongo drive 1984 Lincoln that looks like old coin dug from ground."
<< <i>the DOW & NASDAQ are in positive territories... Time to reanalyze your crystal ball. >>
Generally not wise to judge a market before the days trading has concluded. We are a bit negative now.
I do not consider a 300 point drop to be gloomy, I consider it healthy. Probably too late in the game for a "healthy" correction though as the balloon is taut and will not deflate well. >>
Once again, I totally disagree with your assessment and I've been in the market since the late 60's. Yes, a correction will occur, like it has in the past and will in the future, but only when the market becomes frothy, which in my opinion is based on earnings or speculative returns, it's not at this point. >>
I agree that the market is not frothy, though Nasdaq is getting there. It is though historically way over priced. SP500 Dividend yields have only been lower once in 130 years, which was in the late nineties right before the 2000 bust. It is possible that the sideline stooges will come in late as they did in the waning days of the housing bubble and will make this crash even more historic.
Prognosticators boast of the reasonable PE's. If one is to beleive those numbers, factor in the fact that nearly half of earnings are overseas and cannot be repatriated without huge tax consequences. The quality of these earnings need to be discounted as they are not readily available for redistribution. Example would be APPL who had to borrow through a bond offering to pay a dividend, though they claim to have 100B in cash.
I agree that the market is not frothy, though Nasdaq is getting there. It is though historically way over priced. SP500 Dividend yields have only been lower once in 130 years, which was in the late nineties right before the 2000 bust........
Prognosticators boast of the reasonable PE's.
QE has been causing market distortion, apart from real value. Artificially low interest rates cause companies to mothball and then sell off capital equipment (to overseas) because their balance sheets can be made to look good without all of that messy production and personnel involvement. Besides, hiring people to work and meeting all of those regulatory requirements is much more expensive than it used to be.
Keeps the legal community hopping, tho'.
Q: Are You Printing Money? Bernanke: Not Literally
The FED balance sheet is now at $3.8T. With $55B of total capital the FED is now leveraged 70X. This ain't gonna end well for somebody, probably me and you.
Just checked the upcoming CPI estimate due out this week. Experts looking for .1 or .2 on the less food and energy number. That is the easiest prediction in the world as that is the juggled number every stinkin month.
<< <i>The FED balance sheet is now at $3.8T. With $55B of total capital the FED is now leveraged 70X. This ain't gonna end well for somebody, probably me and you. >>
Why won't this game end well for me and you? Is the value of our precious metal holdings about to get clobbered further?
<< <i>The FED balance sheet is now at $3.8T. With $55B of total capital the FED is now leveraged 70X. This ain't gonna end well for somebody, probably me and you. >>
Why won't this game end well for me and you? Is the value of our precious metal holdings about to get clobbered further? >>
I have given up on accounting in DC being anything but a hoax so the leverage probably does not matter. The fed investment though from an academic perspective has lost perhaps 7% in value in the last 12 months as bond/note prices have declined. So if the fed sold their holdings into the market, a $200B+ loss would occur. It of course would be much higher as the new paper would depress valuations further.
But none of that matters as the old line about a billion here...a billion there....attributed to Everett Dirksen, has been replaced by trillions and no doubt in this new paradigm world where everything is free, quadrillions.
Metals will go up in price, but whether at a profit is questionable as the dollar will only by 12 ounces of squat in the future as opposed to 16 ounces now.
Pay capital gains taxes on the "profit" and your 3 year doubling could in real terms be a loss.
<< <i>The FED balance sheet is now at $3.8T. With $55B of total capital the FED is now leveraged 70X. This ain't gonna end well for somebody, probably me and you. >>
Why won't this game end well for me and you? Is the value of our precious metal holdings about to get clobbered further? >>
Your PMs will most likely be the only thing left of real value. Stock up.
<< <i>A lot of companies are buying back their own shares I think that skews the earnings picture also. >>
Buying back shares has absolutely nothing to do with the amount of money a company makes. It may affect earnings per share, but not the earnings of the company.
<< <i>A lot of companies are buying back their own shares I think that skews the earnings picture also. >>
Buying back shares has absolutely nothing to do with the amount of money a company makes. It may affect earnings per share, but not the earnings of the company. >>
I did mean earning per share sorry . The companies know they have to meet expectations in their quarterly numbers so in the absence of actual improving numbers I think they fudge a bit by taking shares off the table.
<< <i>A lot of companies are buying back their own shares I think that skews the earnings picture also. >>
Buying back shares has absolutely nothing to do with the amount of money a company makes. It may affect earnings per share, but not the earnings of the company. >>
I did mean earning per share sorry . The companies know they have to meet expectations in their quarterly numbers so in the absence of actual improving numbers I think they fudge a bit by taking shares off the table. >>
In the same vein, "non recurring charges" are taken regularly which distort earnings further. Look at the quality of the earnings as well. Low or non taxed earnings locked overseas are not of the same quality as the local earnings which are available for dividend distribution. Apple is a prime example of that.
"When we presented them with the withdrawal slip, they declined to give us the money because we could not provide them with a satisfactory explanation for what the money was for. They wanted a letter from the person involved."
Mr Cotton says the staff refused to tell him how much he could have: "So I wrote out a few slips. I said, 'Can I have £5,000?' They said no. I said, 'Can I have £4,000?' They said no. And then I wrote one out for £3,000 and they said, 'OK, we'll give you that.' "
"As one customer responded: "you shouldn't have to explain to your bank why you want that money. It's not theirs, it's yours."
"When we presented them with the withdrawal slip, they declined to give us the money because we could not provide them with a satisfactory explanation for what the money was for. They wanted a letter from the person involved."
Mr Cotton says the staff refused to tell him how much he could have: "So I wrote out a few slips. I said, 'Can I have £5,000?' They said no. I said, 'Can I have £4,000?' They said no. And then I wrote one out for £3,000 and they said, 'OK, we'll give you that.' "
"As one customer responded: "you shouldn't have to explain to your bank why you want that money. It's not theirs, it's yours." >>
84 Billion Euro bank shortfall may be part of the problem. Thank god the Euro crisis has been solved.
There are a lot of rumors about difficulties in China's shadow banking system. They could have parked a lot of that laundered drug money in there and it went poof.
<< <i>There are a lot of rumors about difficulties in China's shadow banking system. They could have parked a lot of that laundered drug money in there and it went poof. >>
So far, China's economic problems have remained within their borders. What they do to the value of their currency appears to currently be the only international concern to other central banks.
"When we presented them with the withdrawal slip, they declined to give us the money because we could not provide them with a satisfactory explanation for what the money was for. They wanted a letter from the person involved."
Mr Cotton says the staff refused to tell him how much he could have: "So I wrote out a few slips. I said, 'Can I have £5,000?' They said no. I said, 'Can I have £4,000?' They said no. And then I wrote one out for £3,000 and they said, 'OK, we'll give you that.' "
"As one customer responded: "you shouldn't have to explain to your bank why you want that money. It's not theirs, it's yours." >>
Wow, if my bank talked to me like that, I'd rip them a new one. The solution is simple. Switch to a different bank and let HSBC lose business.
References: Too many to list. PM for details. 100% satisfaction both as buyer and seller. As a seller, I ship promptly and keep buyers updated.
Apple drops, Yahoo drop, ATT drops, yet magically everything else rises like the Phoenix. Wish I could get in on the closed door Obama/bankers meetings!
Comments
<< <i>They'll likely taper off $10B every month or two, with the goal of being done buying new bonds by the end of 2014. >>
I agree that is likely the plan. Knock it down by $10B every other month through 2014. Of course when a correction in the equity markets appears imminent, the whole thing will be cranked back up just like 2011, 2012, & 2013. Or as derryb noted, they could modify the program and provide us with a new name. Twist & Shout? Perhaps those of us at the CU Precious Metals forum could provide some input to The Fed regarding an appropriate name for their next stimulus program? Any ideas fellas?
Now I know this is a forum populated by folks who have contrarian views of the central bankers and metals have taken a beating the past year while equities have risen sharply. IMHO Janet Yellen will continue the current policies and it has nothing to do with who sits in the oval office. Remember, Bernanke was put in by Bush. In four years the next president will then have a choice as well regarding the Fed chair. Greenspan worked well past the normal retirement age, but will Yellen want to stay if invited. And who is making the call will also have some implications regarding the invitation to stay.
<< <i>It seems to me that history will treat Bernanke well when you look back at the financial crisis. >>
Doubt it. The inevitable unraveling of equity valuations and more importantly skyrocketing interest rates and inflation will taint the Bernanke legacy. Certainly not entirely his fault as Congress and the administration has continued to deal him a losing hand.
<< <i>One of the reasons the Fed is using QE is that interest rates are effectively zero >>
Short term rates are zero because that is where Big Ben set them 5 years ago. He has much less control over longer rates such as the 10 and 30 year which are much more market driven. In the last year, as Bernanke and his GS friends frantically gobbled up $85B a month of paper, the ten year rate jumped over 100 basis points, which was confusing to Bernanke and he stated as much.
Bernanke is an academic scholar with little real world experience, at least when he became Fed Chair.
Please reconsider your view that inflation is not an issue. 6-8% real inflation rate is my best estimate. Government though tells me that my new $600 computer was $6000 ten years ago so the $5400 price drop offsets the 7% rises in food, energy, cable and medical in 2013.
I do not buy it.
"Not only did it prevent another Great Depression, we've been told, but the money has all been paid back, and the government even made a profit. No harm, no foul – right?
Wrong."
"Who needs risk management when you’ve got guaranteed bailouts? - Jesse Felder
One of these days, we'll have a big earthquake, and I'll say, "See! I was right all along, just early!"
Every day, I wake up and have a coffee. Then I observe to myself that nothing has really changed, in terms of policy and trends. Nor has my opinion changed that current policies are getting us into real trouble with debt, spending and their impacts on our culture and way of living. Too much dependency. Too much laziness. Too many excuses for bad behavior.
It's clear that the US economy is big enough and robust enough to take a lot of shocks and keep on rumbling down the road. What's not clear is how much overburden can be heaped on the people who perform actual work in producing the stuff before all bets are off. It's really not about interest rates or stock market performance. It's about production and consumption.
We've seen this movie before, unfortunately.
I knew it would happen.
Balancing the budget needs both entitlement reform as well as reduction in military spending. There is no magic bean and neither party has the answer on their own. Perhaps the word compromise could return to our lexicon, but I have little hope for that in the present environment.
It is most interesting to have Eisenhower's Cross of Iron speech read by incoming first year college students and to see their take on what it says without revealing either the date or the author before the discussion and then revealing who said it, when and his affiliation. You would be amazed by the answers, which also speaks to the current educational system as virtually none of them had heard of it before the class.
I knew it would happen.
<< <i>I believe that interest rates are at all time lows. I have been around long enough to have experienced 14 percent mortgage rates in the 80s. The problem is more trying to stave of deflation, rather than any inflation problems right now. One of the reasons the Fed is using QE is that interest rates are effectively zero. They cannot lower them to stimulate the economy. If inflation were an issue, interest rates would be much higher and the usual central banking tools of lowering interest rates would be available in order to dig us out of the deep recession. >>
Nice post , I agree completely, but that understanding is lost on many, certainly the majority of the "true believers of all that is gold", imo.
Although inflation will always come around again, it is not the battle most mature economies are facing now. Deflation is still the bigger concern for most of Europe and the US as of now.
I knew it would happen.
<< <i>Perhaps the word compromise could return to our lexicon, >>
Seems that every compromise takes money out of my wallet.
I would go back into the stock market, but its a game of musical chairs right now. I would not know when to pull out of it again. Right now have about 10% of my assets in the market. At least I have 100% control of my previous company 401k now rolled over to an IRA since Jan 2013.
Box of 20
The feds handiwork over the last 5 years may well return the Dow to 6500. Nothing is free in this universe, particularly money. As a quadrupling of the money supply has been generated, interest rates will soon soar, with or without intervention. At 10% bond yields, the 1.85% dividend yield on the SP500 will look like a party favor, and the Dow will plunge to realign to a reasonable dividend return.
BTW, the last two days of stock trading has shown much volatility, albeit in a relatively narrow range. Looks like the buy the dip guys are doing what they do best, then the market flattens back and they try it again. Unlike the last year, there is little upside follow through.
Friday brings the employment numbers which will be a no win for equities. High number and interest rates pop, low numbers and Nasdaq gets panicky. Look for a 300 plus point drop on the downside by the end of trading.
<< <i>null
The feds handiwork over the last 5 years may well return the Dow to 6500. Nothing is free in this universe, particularly money. As a quadrupling of the money supply has been generated, interest rates will soon soar, with or without intervention. At 10% bond yields, the 1.85% dividend yield on the SP500 will look like a party favor, and the Dow will plunge to realign to a reasonable dividend return.
BTW, the last two days of stock trading has shown much volatility, albeit in a relatively narrow range. Looks like the buy the dip guys are doing what they do best, then the market flattens back and they try it again. Unlike the last year, there is little upside follow through.
Friday brings the employment numbers which will be a no win for equities. High number and interest rates pop, low numbers and Nasdaq gets panicky. Look for a 300 plus point drop on the downside by the end of trading. >>
Who is your Swami? I hope it's not the same one that JS has been using for the last several years.
I suppose we'll find out by tomorrow if you are blowing hot air or have a decent fortune teller. My guess, more hot air.
<< <i>I suppose we'll find out by tomorrow if you are blowing hot air or have a decent fortune teller. My guess, more hot air. >>
No swami...and lots of hot air, but I have been following the equity markets since the mid 70's and see a much different pattern the last few days.
Keep it simple. What percentage of the population has a full time job, period. All they have to do is check with the IRS who keeps track of payroll tax deductions.
"Who needs risk management when you’ve got guaranteed bailouts? - Jesse Felder
Well, she made the cover:
But that might not be a good thing:
"Who needs risk management when you’ve got guaranteed bailouts? - Jesse Felder
I knew it would happen.
<< <i>null
The feds handiwork over the last 5 years may well return the Dow to 6500. Nothing is free in this universe, particularly money. As a quadrupling of the money supply has been generated, interest rates will soon soar, with or without intervention. At 10% bond yields, the 1.85% dividend yield on the SP500 will look like a party favor, and the Dow will plunge to realign to a reasonable dividend return.
BTW, the last two days of stock trading has shown much volatility, albeit in a relatively narrow range. Looks like the buy the dip guys are doing what they do best, then the market flattens back and they try it again. Unlike the last year, there is little upside follow through.
Friday brings the employment numbers which will be a no win for equities. High number and interest rates pop, low numbers and Nasdaq gets panicky. Look for a 300 plus point drop on the downside by the end of trading. >>
Well, let's see ...10 year note at 2.90% ( big overnight drop) the DOW & NASDAQ are in positive territories... Time to reanalyze your crystal ball. btw the PM's are also mostly on the up side. Granted, these are early calls, which may change during the course of the day, but unlikely to your gloomy scenario.
It was the Christmas spending season, did anyone really expect all the temp jobs to somehow become permanent?
"Who needs risk management when you’ve got guaranteed bailouts? - Jesse Felder
<< <i>the DOW & NASDAQ are in positive territories... Time to reanalyze your crystal ball. >>
Generally not wise to judge a market before the days trading has concluded. We are a bit negative now.
I do not consider a 300 point drop to be gloomy, I consider it healthy. Probably too late in the game for a "healthy" correction though as the balloon is taut and will not deflate well.
<< <i>
<< <i>the DOW & NASDAQ are in positive territories... Time to reanalyze your crystal ball. >>
Generally not wise to judge a market before the days trading has concluded. We are a bit negative now.
I do not consider a 300 point drop to be gloomy, I consider it healthy. Probably too late in the game for a "healthy" correction though as the balloon is taut and will not deflate well. >>
Once again, I totally disagree with your assessment and I've been in the market since the late 60's. Yes, a correction will occur, like it has in the past and will in the future, but only when the market becomes frothy, which in my opinion is based on earnings or speculative returns, it's not at this point.
<< <i>
<< <i>
<< <i>the DOW & NASDAQ are in positive territories... Time to reanalyze your crystal ball. >>
Generally not wise to judge a market before the days trading has concluded. We are a bit negative now.
I do not consider a 300 point drop to be gloomy, I consider it healthy. Probably too late in the game for a "healthy" correction though as the balloon is taut and will not deflate well. >>
Once again, I totally disagree with your assessment and I've been in the market since the late 60's. Yes, a correction will occur, like it has in the past and will in the future, but only when the market becomes frothy, which in my opinion is based on earnings or speculative returns, it's not at this point. >>
I agree that the market is not frothy, though Nasdaq is getting there. It is though historically way over priced. SP500 Dividend yields have only been lower once in 130 years, which was in the late nineties right before the 2000 bust. It is possible that the sideline stooges will come in late as they did in the waning days of the housing bubble and will make this crash even more historic.
Prognosticators boast of the reasonable PE's. If one is to beleive those numbers, factor in the fact that nearly half of earnings are overseas and cannot be repatriated without huge tax consequences. The quality of these earnings need to be discounted as they are not readily available for redistribution. Example would be APPL who had to borrow through a bond offering to pay a dividend, though they claim to have 100B in cash.
"Who needs risk management when you’ve got guaranteed bailouts? - Jesse Felder
<< <i>"The Fed is in charge of keeping the purchasing power of the dollar stable." >>
Good link.
We have well exceeded the feds 2.5% inflation target and are close to the 6.5% unemployment target.
Prognosticators boast of the reasonable PE's.
QE has been causing market distortion, apart from real value. Artificially low interest rates cause companies to mothball and then sell off capital equipment (to overseas) because their balance sheets can be made to look good without all of that messy production and personnel involvement. Besides, hiring people to work and meeting all of those regulatory requirements is much more expensive than it used to be.
Keeps the legal community hopping, tho'.
I knew it would happen.
"Who needs risk management when you’ve got guaranteed bailouts? - Jesse Felder
A lot of companies are buying back their own shares I think that skews the earnings picture also.
Box of 20
Does anyone really believe it?
I guess Pravda had its followers too!
<< <i>The FED balance sheet is now at $3.8T. With $55B of total capital the FED is now leveraged 70X. This ain't gonna end well for somebody, probably me and you. >>
Why won't this game end well for me and you? Is the value of our precious metal holdings about to get clobbered further?
Liberty: Parent of Science & Industry
<< <i>
<< <i>The FED balance sheet is now at $3.8T. With $55B of total capital the FED is now leveraged 70X. This ain't gonna end well for somebody, probably me and you. >>
Why won't this game end well for me and you? Is the value of our precious metal holdings about to get clobbered further? >>
I have given up on accounting in DC being anything but a hoax so the leverage probably does not matter. The fed investment though from an academic perspective has lost perhaps 7% in value in the last 12 months as bond/note prices have declined. So if the fed sold their holdings into the market, a $200B+ loss would occur. It of course would be much higher as the new paper would depress valuations further.
But none of that matters as the old line about a billion here...a billion there....attributed to Everett Dirksen, has been replaced by trillions and no doubt in this new paradigm world where everything is free, quadrillions.
Metals will go up in price, but whether at a profit is questionable as the dollar will only by 12 ounces of squat in the future as opposed to 16 ounces now.
Pay capital gains taxes on the "profit" and your 3 year doubling could in real terms be a loss.
<< <i>
<< <i>The FED balance sheet is now at $3.8T. With $55B of total capital the FED is now leveraged 70X. This ain't gonna end well for somebody, probably me and you. >>
Why won't this game end well for me and you? Is the value of our precious metal holdings about to get clobbered further? >>
Your PMs will most likely be the only thing left of real value. Stock up.
"Who needs risk management when you’ve got guaranteed bailouts? - Jesse Felder
<< <i>The Crash of 2016 >>
We have only 5 minutes left!!!!
Knowledge is the enemy of fear
<< <i>A lot of companies are buying back their own shares I think that skews the earnings picture also. >>
Buying back shares has absolutely nothing to do with the amount of money a company makes. It may affect earnings per share, but not the earnings of the company.
Knowledge is the enemy of fear
<< <i>
<< <i>A lot of companies are buying back their own shares I think that skews the earnings picture also. >>
Buying back shares has absolutely nothing to do with the amount of money a company makes. It may affect earnings per share, but not the earnings of the company. >>
I did mean earning per share sorry . The companies know they have to meet expectations in their quarterly numbers so in the absence of actual improving numbers I think they fudge a bit by taking shares off the table.
<< <i>
<< <i>
<< <i>A lot of companies are buying back their own shares I think that skews the earnings picture also. >>
Buying back shares has absolutely nothing to do with the amount of money a company makes. It may affect earnings per share, but not the earnings of the company. >>
I did mean earning per share sorry . The companies know they have to meet expectations in their quarterly numbers so in the absence of actual improving numbers I think they fudge a bit by taking shares off the table. >>
In the same vein, "non recurring charges" are taken regularly which distort earnings further. Look at the quality of the earnings as well. Low or non taxed earnings locked overseas are not of the same quality as the local earnings which are available for dividend distribution. Apple is a prime example of that.
"When we presented them with the withdrawal slip, they declined to give us the money because we could not provide them with a satisfactory explanation for what the money was for. They wanted a letter from the person involved."
Mr Cotton says the staff refused to tell him how much he could have: "So I wrote out a few slips. I said, 'Can I have £5,000?' They said no. I said, 'Can I have £4,000?' They said no. And then I wrote one out for £3,000 and they said, 'OK, we'll give you that.' "
"As one customer responded: "you shouldn't have to explain to your bank why you want that money. It's not theirs, it's yours."
"Who needs risk management when you’ve got guaranteed bailouts? - Jesse Felder
"“Those who sacrifice liberty for security/safety deserve neither.“(Benjamin Franklin)
"I only golf on days that end in 'Y'" (DE59)
<< <i>Capital controls taking root in Britain
"When we presented them with the withdrawal slip, they declined to give us the money because we could not provide them with a satisfactory explanation for what the money was for. They wanted a letter from the person involved."
Mr Cotton says the staff refused to tell him how much he could have: "So I wrote out a few slips. I said, 'Can I have £5,000?' They said no. I said, 'Can I have £4,000?' They said no. And then I wrote one out for £3,000 and they said, 'OK, we'll give you that.' "
"As one customer responded: "you shouldn't have to explain to your bank why you want that money. It's not theirs, it's yours." >>
84 Billion Euro bank shortfall may be part of the problem. Thank god the Euro crisis has been solved.
Text
There are a lot of rumors about difficulties in China's shadow banking system. They could have parked a lot of that laundered drug money in there and it went poof.
edited to add
HSBC worlds dirtiest bank
<< <i>There are a lot of rumors about difficulties in China's shadow banking system. They could have parked a lot of that laundered drug money in there and it went poof. >>
So far, China's economic problems have remained within their borders. What they do to the value of their currency appears to currently be the only international concern to other central banks.
"Who needs risk management when you’ve got guaranteed bailouts? - Jesse Felder
<< <i>Capital controls taking root in Britain
"When we presented them with the withdrawal slip, they declined to give us the money because we could not provide them with a satisfactory explanation for what the money was for. They wanted a letter from the person involved."
Mr Cotton says the staff refused to tell him how much he could have: "So I wrote out a few slips. I said, 'Can I have £5,000?' They said no. I said, 'Can I have £4,000?' They said no. And then I wrote one out for £3,000 and they said, 'OK, we'll give you that.' "
"As one customer responded: "you shouldn't have to explain to your bank why you want that money. It's not theirs, it's yours." >>
Wow, if my bank talked to me like that, I'd rip them a new one. The solution is simple. Switch to a different bank and let HSBC lose business.
Text
Apple drops, Yahoo drop, ATT drops, yet magically everything else rises like the Phoenix. Wish I could get in on the closed door Obama/bankers meetings!
<< <i>We have a few generations now that have not experienced double digit inflation
Nor have they experienced deflation. Gravity, while the weakest natural force, is not easily conquered. >>
Don't think that gravity applies to pricing. Could be wrong I suppose.
More smoke and mirrors on the earnings front.
UPS buys back shares