The "up-to-the-minute Market Data" thread

Let's see if we can put a positive spin on this, to play Devil's advocate for a moment: is it possible the Fed is genuinely playing a balancing act whereby they're happy to stoke inflationary pressures so as to head of a deflationary spiral? Then once high inflation starts to kick in they call in the funds, as Bernanke suggests?

It's playing with fire, but could it possibly have some merit? Maybe they just can't swallow the alternative: uncontrolled collapse. So a policy of controlled demolition wins by default.

What do you think?

reply to post by Hx3_1963


www.halcyon.com...
www.usagold.com...
www.micheloud.com...


I remember I did a very long report in a college course regarding the allegory

Dorothy represented the idea of American people,

Scarecrow was the American Farmers

Tin man was the the working class

Lion was a congress critter, William Jennings Bryan

OZ was a corrupt politician, or represented the idea of any corrupt politician, saying one thing and doing another behind the scenes.

And plenty of subtle green, silver and gold references all through the movie. From the Yellow Brick Road which represented the Gold Standard to the Emerald City which referenced the green back movement and even the little bottle which was green that gave the lion (william) courage.

I have no idea why I am discussing this. I'm really bored haha..

Originally posted by pause4thought
Let's see if we can put a positive spin on this, to play Devil's advocate for a moment: is it possible the Fed is genuinely playing a balancing act whereby they're happy to stoke inflationary pressures so as to head of a deflationary spiral? Then once high inflation starts to kick in they call in the funds, as Bernanke suggests?

It's playing with fire, but could it possibly have some merit? Maybe they just can't swallow the alternative: uncontrolled collapse. So a policy of controlled demolition wins by default.

What do you think?

That's exactly what I think they are doing, and have said they are doing.

I don't think it will work however.. the money, because it was invested, multiplied, and lent out.. is now beyond of the Feds reach .. the funds are not sitting in the banks vaults like they want us to believe, it's quite obvious the banks used the funds in a variety of other ways. Not to mention the amount monetized into debt for the Federal Government... Once the investments hit the general Economy... we will see very, very high inflation.

reply to post by Rockpuck
Dang yer good!!!

And bored!!!



And I thought you might have to dig...silly me...

@ P4T: I'm sure he's scared of the deflation scenario, as the Fed's whole policy is built on what, ~2% constant inflation?

Seems to me at some point in reoccurring cycles, the system just can't support itself at that rate...the masses get saturated with debt/possessions and a reset is needed, but, they just don't get it or can't find a formula that covers it yet...Hmmm... :shk:

reply to post by Rockpuck


Interesting. I wonder how many will agree/disagree with the bleak prognosis. It's fascinating to view the issues from all angles, I find.

BTW, what would you say will be the leading indicators of uncontrollable inflation kicking in?

(I know that's another big question - no harm in trying, though.)

reply to post by pause4thought
My guess is your seeing it already as RP stated...the cat's out of the bag...and it's being used to re-inflate the equity markets as we speak...

And I agree with him...to try to take it out would snap all the toothpicks holding the 800 Lb Gorilla up... :shk:

Sound right RP?

reply to post by Hx3_1963

Dang yer good!!!

Oh please, you're making me blush....

BTW, what would you say will be the leading indicators of uncontrollable inflation kicking in?

Trickle Down Economics. It generally for the most part doesn't work like it's supposed to in theory.. but if you inundate a certain portion of the economy with cash, you cause hyper inflation in that sector. From 2001-2007 we saw cash being inundated into the Real Estate side of the economy, this caused a disproportioned inflation in that sector, from banks issuing the cheap credit causing house prices to inflate, causing construction materials to inflate causing raw materials to inflate, all the while generating a huge new work force that slowly spread across the broader economy from all the higher consumption taking place as that particular part of the economy expands. All the while, the rest of the economy saw nothing spectacular occur.. manufacturing continued a decline while wages were slow growing to stagnate. The result was the top heavy side of the economy like anything that looses equilibrium, goes bottoms up.

The method being used to restore order is to inundate the financial sector .. boosting reserves, of course, but the actual goal is to create enough reserves to cover the balance sheet of liabilities and ultimately issue cheap credit once more. If you give a handful of corporation a few hundred billion dollars, it's going to seep through the pours like a dam about to break.. the money is to hard to contain. The more you have, the more you spend..

I find it highly unlikely that when the time comes for the Fed to take the funds from the economy, that funds will even be left.. they might take the equivelent out, but through investment, lending and other practices, the funds are already slowly seeping their way down through the economy. Be it through small business loans, mortgages, car loans, or multi million dollar bonuses to flush the wealthy class with even more liquid cash.. eventually the money will spur higher inflation as the fed struggles to withdraw the funds. And all the while the Fed will be trying to grab as many Dollars from the economy as possible, by all recent accounts, they will continue to have to monetize the massive debt of the Federal Government.

In fact.. I seriously doubt the FED will ever actually get to the point of withdrawal, it's more likely they may just give up and focus on trying to decrease the amount of new cash they are puting into the system..

If Obama's health care plan passes, given that we are already negative as far as our deficit goes, the entire program will have to be funded by either tax payers (deflation) or investors (inflation) or the FED (high inflation).

Edit to remove a link that went to nowhere?

[edit on 8/6/2009 by Rockpuck]

reply to post by Hx3_1963

Sound right RP?

Yes sir, my thoughts exactly. Just a lot less long winded than my explanations.

[edit on 8/6/2009 by Rockpuck]

reply to post by Rockpuck


Nice going, RP. You should be in education.

Let's keep half an eye on the Dow:

9240.39 down 40.58 -0.44%

Doubtless stander will tell us where it will go from here.


[edit to add:]

Just checked again:

9217.41 down 63.56 -0.68%

"Stander?.."


[2nd edit:]

9212.05 down 68.92 -0.74%

Anyone got his phone number?





[edit on 6/8/09 by pause4thought]

reply to post by pause4thought

Nice going, RP. You should be in education.

That's what people tell me. More so because my degree in history is uh .. I don't know what it is. I don't like little kids. I don't like teenagers. And I don't like college aged kids. If I taught in school I would be on one of those 20/20 investigative series about teachers who treat their students to cruel and unusual punishments.

reply to post by Rockpuck


You should be in adult education. Well I suppose you already are, in a manner of speaking.

BTW, I posted those edits above within the space of a few short minutes. Maybe just a blip.

reply to post by cpdaman


This is what happened. The ability to lend is tied to the stock of a bank. The more the value of a bank depreciate via common stock, the less the bank can lend – that’s the rule. Now when the credit froze and the market went south, the Fed used the prime rate to unfreeze it and drove the rate to zero. But the depreciated value of the bank industry was another problem to be dealt with. So either you go through the lengthy process of changing temporarily the rule, or you bypass it by “bailing out” pros like Goldman Sachs. That company was asked to use the Fed funds to resuscitate the market with a special attention to the banking sector.

I loved this article. It highlights that either few in the Government.. or CNN .. or both .. know jack about economics:

money.cnn.com...

The boost to auto sales caused by the government trade-in program should lead to increased production from Detroit. That could have a big ripple effect.

"History shows that the success of stimulus packages depends on people responding to the incentives to spend money," said Joseph Carson, chief economist at AllianceBernstein. "It's having an intended, if not larger, impact than people expected."

So this is how it works. GM has, say, 50 cars waiting to be shipped. Cash for clunkers causes 25 to be sold. Gov pays them the money (never mind the Gov owns GM so it's like a small business owner buying from his own store then telling everyone about the profit he made). GM then builds 25 cars. The Cash for Clunkers expires. GM is left with 50 cars. They no longer produce more, because inventory is back to normal.

Unless, as "economist" Joseph Carson, who has the economic intelligence of a 5th grader, is assuming that because gm sells a few cars far under retail value it's going to inspire other people who did not qualify to go and buy a new car. Which would be quite a spectacular feat if that really did occur. In all likeliness the people on the fence about a new car took the opportunity for a super cheap car, trading in their explorers, and their hummers and other beastly tanks for tiny "green" cars .. are now removed from the Auto market for at least 2-3 years. Unless... Mr. Carson is assuming you give them one good deal .. they will just continue buying the cars in infinite numbers.. which would be perplexing.

So anyways, not dwell in negative town.. CONGRATS Government.. you officially gave GM, Ford, and a number of Japanese and Korean car companies at least one month of profit and two months of manufacturing, at a mere cost of $3 billion Dollars. And I must say, Mr. Obama, buying two major car companies, then using American tax Dollars to buy the products from those two companies to show a profit and the ability to say "hey, we sure turned those companies around, eh?" is simply ingenious. If only I can find a way to open a shop, buy my own goods and make a fortune doing it, I'd be a made man!

Originally posted by pause4thought
Let's see if we can put a positive spin on this, to play Devil's advocate for a moment: is it possible the Fed is genuinely playing a balancing act whereby they're happy to stoke inflationary pressures so as to head of a deflationary spiral? Then once high inflation starts to kick in they call in the funds, as Bernanke suggests?

Yes, I agree, but their aim is to protect the money mafia and nothing else..Does anybody really think the Fed is interested in how many millions of Americans are unemployed?

I'm sure most of you know how and why the Fed was created in the first place....Even I have to admit that they have played a miraculous game of Ponzinomics over the years, and especially within the last 10 months....but they are in currently in real panic mode and unavoidable and undeniable reality is setting in. The Banksters have had a fabulous run, but their time is up, and they really only have one or two options..

1) They declare a debt jubilee and start from scratch.. (the economic growth from this move would be parabolic, and they would be celebrated as heroes. Really, the banksters would stand to leach much more from this play than if they manage to hold the current Ponzinomics scheme together)

Unfortunately, the rest of the world would probably object, which brings the 'ole tried and true...

2) WAR.....this little gem has served them very well in the past, although, depending on how many of us survive, they might have to start from scratch anyway.....and there has been rumors that depopulation is back in favor...

Edit to add...sorry to interrupt the current conversation...I was pulled away right in the middle of my post

[edit on 6-8-2009 by RolandBrichter]

I wonder how long this mornings quantitative easing in the UK is going to keep running up the US dollar?

futures.tradingcharts.com...

Oil and stocks are really taking a beating today.

The Dow is down near the new 9200 floor we put in yesterday.

Originally posted by fromunclexcommunicate
And the US markets go down and test the bottom of the trading range again.

I see that there are very diverse theories regarding that.

Stocks Retreat as Cisco Drags on Dow

www.cnbc.com...


I suppose those who "test the trading range" are not volunteers, are they?

Obama doesn't want any pullbacks. So the market will stay logarithmic , courtesy well-armed Goldman Sachs, all the way to January when it hits 10K.



[edit on 8/6/2009 by stander]

reply to post by RolandBrichter


I remember Slayer pointing out in another thread (America is a war economy) that small, ongoing conflicts have been a nice little earner for a very long time. And Iraq/Afghanistan have certainly put a few cents in certain people's pockets. I suppose the argument is that only something truly cataclysmic could kick-start the world economy in the current black hole.

Option one doesn't look attractive either. It would very easily feed into the NWO control scenario.

Very strange, very strange: after the bonus party over at GS, GBM is absent . . .


I see some detours . . . Or maybe someone lost his way.
That way Mr. Goldman.
You are very welcome. Drive carefully.

[atsimg]http://files.abovetopsecret.com/images/member/8a8b22333819.jpg[/atsimg]



[edit on 8/6/2009 by stander]

reply to post by stander

I see that there are very diverse theories regarding that.

I read the Bank of England was making a decision about their money policy this morning but I was out away from the computer for a few hours, when I came back it was too late the dollar had taken off.

I'm not sure what lifts the Dow industrials, maybe swearing an oath to the Illuminati?

www.cnbc.com...

Goldman Sachs expects commodity spike next year to mimic 2008 when oil rose to 150 dollars a barrel NEXT YEAR.



And they are using the same BS reasons, such as developing countries will start consuming more. This is bloody fu*king ridiculous. We don't have capitalism anymore. We have the governments of the world controlling prices but through clandestined means. I guess 150/barrel of oil again will make Obama happy so it can work towards alternative energy. And he can just raise taxes on us so we can provide more money for welfare and social security if energy prices rise!

Mark my words, in Obama's term, we will see much higher oil prices. If they should be there or not. Welcome to Socialtism, where the government controls the economy through other companies that are supposedly private.

Dow at close:

9256.26 down 24.71 (-0.27%)

Source


Yet another surreal swing:

Shares in Lloyds Banking Group surged by 11% despite its announcement of a £4bn loss in the first half of 2009, due to mounting bad debts at HBOS.

Comments that most bad news was now out and that future results would improve had heartened investors, said analysts.

The group, which is 43% owned by UK taxpayers, said £13bn of loans and investments had turned bad, most of them from Halifax Bank of Scotland.

It predicted future such charges for bad loans would be smaller.

Source


What, you mean maybe only another £3 billion loss? Break out the champaign, and buy, buy, buy.

It's not as if you have to look very hard to see the seriousness of the situation:

BBC business editor Robert Peston said the results bore witness to the quite astonishing risks taken by HBOS.

And he added that the figures were more troubling for taxpayers than shareholders, as most of the poor quality loans were now being insured by taxpayers, not the banks.

Marvelous.


[atsimg]http://files.abovetopsecret.com/images/member/ae2f78d9bd28.gif[/atsimg]

(Source as above)


Absolutely marvelous.