QE Is Dead, Now You Tell Me What You Know
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NPC Grief monument, Rock Creek cemetery, Washington, DC 1915 It seems like every blue moon or so I need to return to Groucho’s definition of chaos the
[See the full post at: QE Is Dead, Now You Tell Me What You Know]The perception, IMO, is that the Fed still is ready to backstop if needed. When that goes, look out!
The madness has reached a point where it might be wise to question the sanity of those running the show imho.
How can the lies, distorted economic figures, crazed stock and bond valuations, violent markets, Fed blabber, economic recovery nonsense, etc, be seriously analyzed by anyone who has remained somewhat sane and sober?
We may be wise to just watch the dementia in astonishment, wondering what lunacy is next, rather than succumb to the desire of the sane to make order or understanding out of the chaos.
Just as one small example, was perusing Ali Baba for a possible short sale if the end of this current QE might possibly cause some rational thinking. It has a market cap of 250 billion and sells at 25 times it’s sales and also 25 x book value. It is only one of dozens with such insane valuations.The market, of course, went up 200 rather than the other way that I expected, and it became apparent to me that to enter such an asylum would probably mean I had gone mad as well.
Best to watch Mad Money, let crazy Cramer make predictions, and wonder when, if ever, sanity will return.
I wouldn’t be surprised at all if Ferguson and the stock market both blew up just before the elections.
QE as a brand name is dead. Call the “New Improved” what you will, the fact is, the Fed now owns all this.
It’s theirs to either save or lose. There is nothing representing intrinsic value behind their currency, only faith and credit psychology. Put another way, Bullshit.
On gold as religion, money is money. About all one can do is try and guesstimate median production cost and fundamentally base purchases on that. Certainly, Au will be around longer than Granny and her Cookie Dough.
Likely Au, Ag, Cu, Zn, et al, will be around even longer than present systems of government, as well. Rather than thinking of things “real” as religious, I like to think of them more as a bridge, on which to cross over to the other side, when all the “Great Ones” finally swamp their little fiefdoms, and are exposed as the phony alchemists they really are.
Or is this Empire somehow immune to the fate of all others that have gone before?
Agree, Oxen. These “markets” are muppet bait. That said, shorting them is akin to shorting the Fed. Do ya feel lucky?
I wholeheartedly agree that gold cannot become religion and one should not “bet his life” on it. But in prior posts Ilargi seemed to recommend hoarding cash instead, fearing a deflationary collapse. I would not “bet my life” on cash either.
Perhaps common ground (and common sense) is to hold at least some assets outside of the banking system — perhaps a combination of cash and gold and other physical assets. I remember a Marc Faber interview where he commented that any rational adult who sees what central banks are doing is crazy to not invest at least a small amount in physical gold on a regular basis — simply because of the uncertainty about what will happen when all of this eventually unwinds.
What do I know?
Not much really. Maintain zero debt and up ones savings as much as possible. Live small and sufficiently.
And I think you’re correct about the viability of the dollar, at least in the not so foreseeable future…Yves Mersch of the European Central Bank at the Corporate Credit Conference in Zurich on October 17th. He addressed QE and how it creates inequality. He said:
“Non-conventional monetary policy however, in particular large scale asset purchases, seem to widen income inequality, although this is challenging to quantify.
Still, a central bank with a clear mandate to safeguard price stability needs to act forcefully when push comes to shove. These distributional side-effects then need to be tolerated. But they clearly should not last too long. They are one more reason to recognise that the non-standard measures we have introduced have to be temporary.”
https://www.bis.org/review/r141020d.htm
Temporary, should not last too long. He also quotes Bullard (Mr. “I’ll Save the Stock Market Until I Have Time to Get Out Myself”, who says the same thing. Low rates don’t help people without a job because they can’t get a loan. They don’t help the elderly savers or the young. They really only help those already in debt and those who are able to borrower for essentially nothing.
This guy, Bullard, Greenspan – all talking inequality. And, hey, it’s not like it hasn’t been happening, but they’re finally addressing it. They’re trying to let on that the economy is great and the unemployment rate is down because they’re afraid of what might happen to their spindly little necks if the truth really got out there, that they’ve been helping the banks and their friends. Oh, that’ll go down well when it sinks in, and it will.
The wizard has been seen.
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