QE3?

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andyfuller
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superfrank wrote:exactly Jeff - the plebs don't have a clue that the purchasing power of their money is being eroded as tptb create inflation to erode debt.
The purchasing power may be being eroded but also their high levels of debt are being eroded.

Take my sister (not a pleb but has a big mortgage) She has been on an unbelievable low rate of interest on her mortgage for ages now and at the same time the value of that debt has been eroded. She is winning on both counts, I on the other hand am getting a pitiful rate of interest on my savings whilst it is also being eroded by inflation.

Who's the pleb? ;)
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superfrank
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i wasn't being offensive to anyone just emphasising the point that the masses don't understand what's going on.

yeah it's great for those that bought assets at inflated prices with high leverage - they have got away with it (after the previous house price boom in the eighties people weren't so lucky).

the reason that tptb couldn't let the market adjust naturally this time was that the bubbles were so huge (because of their negligence) that the whole system was in danger. but all they've really done is postpone the pain - anyone who thinks things are fixed, or that all this largesse won't have to be paid for, needs to wake up.
Last edited by superfrank on Thu Feb 09, 2012 2:28 pm, edited 1 time in total.
andyfuller
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Yup the day of reckoning will come eventually. They just don't want it on their watch if at all possible. Things are a long long way off being fixed imo.
mulberryhawk
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Frank are u Tyler Durden in disguise ;)
Iron
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I imagine that Frank is flattered that you mistook him for Brad Pitt! :lol:

http://www.google.co.uk/imgres?q=tyler+ ... 29,r:0,s:0
mulberryhawk wrote:Frank are u Tyler Durden in disguise ;)
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superfrank
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I wish (on looks and intellect!)...

Image
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superfrank
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How does quantitative easing work?
http://www.bbc.co.uk/news/business-16974497
Stephanie Flanders on how QE works... no mention whatsoever of any downsides of printing money e.g. the fact that it impoverishes the young and unborn to keep baby boomers "rich", inflation and increased chance of hyperinflation etc.
Iron
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Quite. The bias is palpable.

Here's a more balanced assessment of QE, which talks about things like the fact that QE is effectively a tax on pensioners: http://www.telegraph.co.uk/comment/9073 ... money.html

Jeff
superfrank wrote:How does quantitative easing work?
http://www.bbc.co.uk/news/business-16974497
Stephanie Flanders on how QE works... no mention whatsoever of any downsides of printing money e.g. the fact that it impoverishes the young and unborn to keep baby boomers "rich", inflation and increased chance of hyperinflation etc.
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superfrank
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Dennis Gartman is ‘wild-eyed bullish’ on stocks
http://www.marketwatch.com/story/dennis ... inginsight
“Investors are terrified of stocks,” Gartman told me. “You can’t get people to buy Procter & Gamble PG with a dividend of 3.3%.”

Besides bond funds, people have been sticking their cash into the proverbial mattress. “Baby boomers are laden with cash,” Gartman said. “Checking-account balances are outrageously high. They’re paying out nothing at all.”

What’s going to get these terrified people with bulging checkbooks back into stocks? “Greed,” Gartman replied simply. “Greed and the need for yield will bring them in. That’s what the Fed wants them to do.”

Take note, conspiracy theorists and Ron Paul supporters (not necessarily the same people): Gartman largely agrees with you — the Fed is behind the whole thing.

By promising that short-term interest rates will stay near zero until 2014, Federal Reserve Chairman Ben Bernanke is offering savers what is in effect a Hobson’s choice: Earn nothing and watch your capital deteriorate, or jump in the pool and take some risk. And don’t worry: The water’s fine.

“Keeping rates low and long will force boomers to … move into the equity markets,” albeit kicking and screaming, Gartman told me.
Iron
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Bank of England's £50bn QE puts Britain in 'better position than Germany' [according to Fitch] - http://www.telegraph.co.uk/finance/econ ... rmany.html
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superfrank
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Nazi forged bank notes hit sterling confidence, MI5 files show
http://www.bbc.co.uk/news/uk-17070943
The Nazis produced counterfeit sterling with a face value of £134m in total.

That was the equivalent of 10% of all sterling in circulation.
the German's gave us involuntary QE back in 1940 - after Weimar they knew how to wreck a currency and create inflation...
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Euler
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Location: Bet Angel HQ

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superfrank
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the one thing you can but sure of is that, in the event of any real recovery, the central banks will be far too slow in withdrawing the monetary stimulus.

always trigger happy with easing, always way too slow to tighten.

the ECB loaned out another €530 billion (that it doesn't have) today to 800 banks at 1% over 3 years. wouldn't it be nice to be a bank!
http://www.zerohedge.com/news/ecb-ltro- ... 95-billion

meanwhile the markets didn't like Bernanke's testimony that indicated that US QE3 is not imminent... (it will happen sooner or later)
http://www.zerohedge.com/news/ben-pulls ... et-unhappy
Iron
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QE was an emergency measure – it should end - by ex MPC member Andrew Sentance: http://www.telegraph.co.uk/finance/econ ... d-end.html

'If we don’t start the gradual shift away from emergency monetary policy settings soon, the MPC risks having to play catch-up in the future: pushing up interest rates sharply and triggering a large negative shock to business and consumer confidence'.
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superfrank
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Andrew Sentance was the only sensible voice on the MPC.

there is hardly any difference of opinion on the MPC now, which i guess is just how Merv likes (but it's very unhealthy especially given that the rest of the committee are essentially just representatives of private banks).
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