Category Archives: Central Banks

Bernanke on Warren-Vitter & Last Resorts

By Biiwii

Ref. Warren-Vitter and the lender of last resort

[edit] I have had some complaints about writing that I “like” Bernanke and Obama.  That is telling of how divisive today’s financial and political climates are.  I did not write ‘I like the jobs they have done’, after all.  I have not “liked” the job a Fed chief or President have done since I can remember.  It was wording in a post simply implying that I think they are probably nice men.  Sheesh… it would help if some people would actually make the effort to pick up on nuance.  It’s a post answering the assertions of a former Fed chief destined to see the annals of history one day revoke his “Hero” status.

I have always liked Ben Bernanke, in that I think he is a soft-spoken, nice guy who took the hand off from Alan Greenspan in stride, heroically making chicken soup out of the chicken excrement he was left with.  He kept his dignity and calm demeanor during the days when inflationist gold bugs codified the term “Helicopter Ben” and turned it into just another accepted way of saying “Ben Bernanke”.

Mr. Bernanke met the impossible challenges left him by the Greenspan Fed and the Bush White House, and being a scholar of the Great Depression and an intellectual Keynesian, did what he was always meant to do.  He employed tried and true Central Bank policy-making against a natural bust (i.e. reaction to Greenspan’s policy-induced 2003-2007 inflationary boom) of the system.

Continue reading Bernanke on Warren-Vitter & Last Resorts

Raghuram Rajan Speaks

By Biiwii

Of all the world’s Central Bankers, one stands out as a teller of truth and an adherer to sensible long-term policy.  Yes, my personal hero (insofar as one has heroes in the financial realm), Raghuram Rajan.  Thanks to Joe for the link…

India’s central bank chief accuses G-7 of currency manipulation

I mean sure, we all see and to varying degrees understand the bald faced currency manipulation (and other policy machinations) going on out there.  But it is important when a Central Banker cries out in the wilderness.  Even if said Central Banker is not overseeing the finances of a fully developed nation (yet).  It doesn’t sound like the IMF is listening.  That would be the International Muppet Fund.

Speed Readers

Speed readers everywhere see “does not mean that that the Committee has decided on the timing…”

And they’re off to the races!

For immediate release

[edit] Okay, so they dropped the word “patient” that everybody was hyperventilating about.  What did they replace it with?  That gobbledeegook above.  It really is unbelievable how so many take this so seriously.  Folks, we are in Wonderland…

T-Minus 1hr, 40 min. to the Great Drama

By Biiwii

Of course, at 2:01 US Eastern time the market could get very actionable, but for right now it is a ‘close to the vest’ market.  This means no big bets and no strong leans in one direction or the other.

Everyone Hates US Stocks  –Bloomberg

If that’s true, that ain’t bearish.

Hedge Funder Dalio Thinks the Fed Can Repeat 1937 All Over Again  –Bloomberg

I researched this gentleman and I love what he is all about, philosophically and in the way he views life as it relates to his vocation in the markets.  i.e. it’s not just some MSM b/s.  He is to be taken seriously IMO, in his knowledge of the markets but even more, as a respectable human (something lacking in this sphere, again IMO).

So here is the Fed’s idiotic Dot Plot that we are all supposed to be transfixed by.


The stock market took a hit, bounced and now by my eye anyway, is not at all cut and dry.  Sentiment became toxic to the over bullish side a couple of weeks ago.  Then the market dropped and bounced.  This should not be an end to the downturn given the former sentiment profile that has not been nearly fixed yet.

But the leadership items we follow (esp. Biotech, Small Caps and Banks) are stable to good and then there are the AAII Individual Investors having been spooked, which is short-term positive (though the longer-term trend is over bullish and so, not healthy).


There’s lots more to the picture that can’t make it into a simple post.  But it is best to check assumptions at the door and let’s all just be prepared for what is on the other side.  It’s not so much the FOMC I am concerned about as my fellow market participants.  That’s why I have remained in a comfortable position and recommended the same in NFTRH.  It’s the ‘no strong leans’ market at the moment.


In other words, we may raise interest rates or we may not.  Ha ha ha…

[edit] subtext:  screw the savers, let’s pretend that the hype is true and the great November ‘Jobs’ report is going to fan out and start enriching Main Street now that the top 1% are not only bailed out, but enriched beyond their wildest dreams.  Let’s pretend it has nothing to do with the fact that we already know we cannot raise interest rates without some… how shall we put it… significant side effects.

Release Date: December 17, 2014

For immediate release

Information received since the Federal Open Market Committee met in October suggests that economic activity is expanding at a moderate pace. Labor market conditions improved further, with solid job gains and a lower unemployment rate. On balance, a range of labor market indicators suggests that underutilization of labor resources continues to diminish. Household spending is rising moderately and business fixed investment is advancing, while the recovery in the housing sector remains slow. Inflation has continued to run below the Committee’s longer-run objective, partly reflecting declines in energy prices. Market-based measures of inflation compensation have declined somewhat further; survey-based measures of longer-term inflation expectations have remained stable.

Continue reading FOMC

Biggest Heist in History

Guest Post by Bill Bonner

The Biggest Financial Heist in History

Source: Wikipedia

If Mr. Market is afraid, he is putting on a brave face. The Fed’s QE ended on Wednesday. On Thursday, the Dow rose 221 points.

This is good news for Janet Yellen. She must think she has made a clean getaway. She has fled the scene of the biggest financial heist in history with no cops in sight. They’re not even aware a crime has been committed!

This grand larceny involved $3.6 trillion. Counterfeit – every dollar of it. Not a penny of it was ever honestly earned or earnestly saved… or dug out of the dirt and turned into coins.

No… We’re talking about the crime of the century… committed in broad daylight… with millions of witnesses. But hardly a single soul understood what was going on.

We begin by asking: How many TVs, luxury apartments, spaghetti dinners and parking places are there?

Continue reading Biggest Heist in History

BOJ Jumps the Shark…

Guest Post by David Stockman via Stealthflation

The BOJ Jumps The Monetary Shark—–Now The Machines, Mad Men And Morons Are Raging

This is just plain sick. Hardly a day after the greatest central bank fraudster of all time, Maestro Greenspan, confessed that QE has not helped the main street economy and jobs, the lunatics at the BOJ flat-out jumped the monetary shark. Even then, the madman Kuroda pulled off his incendiary maneuver by a bare 5-4 vote. Apparently the dissenters——Messrs. Morimoto, Ishida, Sato and Kiuchi—-are only semi-mad.

Never mind that the BOJ will now escalate its bond purchase rate to $750 billion per year—-a figure so astonishingly large that it would amount to nearly $3 trillion per year if applied to a US scale GDP. And that comes on top of a central bank balance sheet which had previously exploded to nearly 50% of Japan’s national income or more than double the already mind-boggling US ratio of 25%.

Continue reading BOJ Jumps the Shark…