Hilsenrath Hits The Tape: Ignore Everything I Said Two Weeks Ago
by Zero Hedge - May 22nd, 2013 12:00 pm
Courtesy of ZeroHedge. View original post here.
Submitted by Tyler Durden.
The last time the WSJ’ Jon Hilsenrath was relevant was two weeks ago (in a flashback to those days before QEternity when infinite QE was not assured and Jon’s input was actually relevant), when following an article of his, and due to his “proximity” with the New York Fed, many assumed that the Tapering suggested by Hilsenrath was being telegraphed by Bernanke to the market. Turns out it was nothing but yet another baffle with bullshit headfake by a central planning regime that is now merely engaged in observing market responses to indirect stimuli: if reduce monthly flow by $20 billion then X (-1%); if cut QE off entirely then Y (-50%?), and so on. Moments ago the same Hilsenrath just released another piece, which effectively refuted everything his previous piece suggested, and in fact made his position as Fed mouthpiece absolutely irrelevant, courtesy of the following disclosure: “this time, when the Fed shuts off bond buying, it won’t be… predictable.” He goes so far as to say that the term “tapering” is no longer even applicable! Funny that, considering on May 11, none other than Hilsenrath said: “Federal Reserve officials have mapped out a strategy for winding down an unprecedented $85 billion-a-month bond-buying program meant to spur the economy.”
The irony here is that Hilsenrath is correct, but for another far simpler reason: the Fed simply can not shut down bond buying, at least not voluntarily, without crashing bond the stock market, and the perception that the economy is doing well (it isn’t), just because the S&P hits new all time highs day after day.
The Fed will of course “shut down” bond buying when like in the summer of 2008 simple inflation is raging in commodities, and when a bank has to be sacrificed to induce a deflationary vortex. However, for now thanks to the epic planning in keeping the Brent vigilantes largely in check (now that the Bond vigilatnes are long dead), and since the market has a few more thousand points higher to go before everyone has no choice but to acknowledge how ridiculous the asset bubble has become, there is, to paraphrase Tim Geithner, “no risk.”
When the Fed ended a buying program in
…
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Swedish Youth Riots Enter Third Day
by Zero Hedge - May 22nd, 2013 11:32 am
Courtesy of ZeroHedge. View original post here.
Submitted by Tyler Durden.
Sparked by the police shooting of a machete-wielding 69 year-old man, traditionally calm-and-collected Sweden is suffering amid its third night of riots. It seems underlying tensions from high youth unemployment and rising nationalism against the nation’s large immigrant population have been catalyzed by this seemingly unrelated event. As the Daily Mail notes, immigrant ghettos have been created where unemployment is high and there are few opportunities for residents with left-leaning commenters adding that the riots represented a ‘gigantic failure’ of government policies, which had underpinned the rise of ghettos in the suburbs – “We have failed to give many of the people in the suburbs a hope for the future.” An anti-immigrant party, the Sweden Democrats, has risen to third in polls ahead of a general election due next year, reflecting unease about immigrants among many voters. What is driving this tension? After decades of practicing the ‘Swedish model’ of generous welfare benefits, the country has been reducing the role of the state since the 1990s, spurring the fastest growth in inequality of any advanced OECD economy. Given Sweden’s 24.7% youth unemployment, we wonder just what will happen to the 60% of unemployed youths in Greece and Spain when school lets out this summer?
Brief clip below provides more color…
This can’t end well!
Via The Daily Mail:
The disorder has intensified despite a call for calm from Prime Minister Fredrik Reinfeldt.
Last night, rioters attacked the police station in the Jakosberg area in the northwest of the city and set fire to 30 cars.
…
Groups of youths also smashed shop windows and burned down a 19th Century cultural centre.
Gangs of up to 60 set fire to a school and a nursery and hurled rocks at police and firefighters.
…
While average living standards are still among the highest in Europe, governments have failed to substantially reduce long-term youth unemployment and poverty, which have affected immigrant communities worst.
Some 15 per cent of the population is foreign-born, the highest proportion in the Nordic region.
…
Among 44 industrialized countries, Sweden ranked fourth in the absolute number of asylum seekers, and second relative to its
…
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Microsoft To Hire Thousands… In China
by Zero Hedge - May 22nd, 2013 11:09 am
Courtesy of ZeroHedge. View original post here.
Submitted by Tyler Durden.
Perhaps the best answer to the question posed to Bernanke moments ago whether US unemployment is structural or cyclical comes courtesy of Microsoft, which announced earlier that it was set to hire “several thousand” workers. Sadly, the catch is that the hires will be in China.
From BusinessWeek:
Microsoft the largest software maker, will hire several thousand workers in China to support new cloud computing services and smartphones using its Windows operating system, Chief Executive Officer Steve Ballmer said.
The workforce (MSFT) expansion, from a current base of 4,000 staff, will take place during the next year, Ballmer said today at a press conference in Shanghai that was streamed live on the Internet. He didn’t provide a specific number for new workers.
China has become the fastest growing market (MSFT) for the company’s smartphone operating system, Ballmer said. The Redmond, Washington-based company will start a public preview of its Windows Azure service in the country next month, making Microsoft the first multinational to offer public cloud computing in the nation.
“I visited China last about one year ago in May and it is remarkable to me how much has changed,” Ballmer, 57, said. “At Microsoft this is an incredibly exciting time.”
For future Chinese employees of Microsoft it is a quite exciting time too. For those Americans who will not be hired by Microsoft as a result of this decision, it is not nearly as exciting. But at least those unhired workers can take solace that their E*trade daytrading P&L is green for the day.
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Bernanke “No Tapering”; Silver Goes Up and Down Again
by Zero Hedge - May 22nd, 2013 11:06 am
Courtesy of ZeroHedge. View original post here.
Submitted by Monetary Metals.
In February, I wrote What Drives the Price of Gold and Silver?
If there is a credible rumor that the Fed is planning to further extend its “Quantitative Easing”, how would you expect the monetary metals to react? Typically, the gold price would rise and the silver price would rise even more. The question is why.
Traders read the headlines and they know how the price “should” react to such news, and they begin buying. For a while, the prophecy fulfills itself. But then what happens next? It may take an hour or a month, but sooner or later some of the new buyers begin to sell.
Most people accept the Quantity Theory of Money. In brief, if the money supply rises then prices will rise (though often there is a caveat that not all prices will rise uniformly).
Today, Fed Chairman Bernanke said that the ongoing increases in the quantity of dollars will continue. The silver market reacted as it “should”: more money = higher silver prices. Look at this annotated chart.
In about 15 minutes, the silver price rose 2.2%. I call this the “Quantity Theory of Money Gap”. In about 15 minutes more, the price fell back to where it had been.
Within 30 minutes, all those who had bought based on this idea were, if not proven wrong, at least given losses by the market.
The price of the dollar as measured in gold or silver is collapsing and the rate of collapse will accelerate. This will be reflected in much higher prices of gold and silver when quoted in dollars. But it is not due to the quantity of money, and certainly not due to talk of the quantity of money.
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China Platinum Imports Rise – Bullish Platinum and Palladium Fundamentals
by Zero Hedge - May 22nd, 2013 11:01 am
Courtesy of ZeroHedge. View original post here.
Submitted by GoldCore.
Today’s AM fix was USD 1,385.25, EUR 1,071.43 and GBP 917.75 per ounce.
Yesterday’s AM fix was USD 1,378.75, EUR 1,070.21 and GBP 908.39 per ounce.
Gold fell $6.50 or 0.47% yesterday to $1,377.80/oz and silver finished down 0.56%. Click here to download our free guide to gold.
The fundamentals of the platinum and palladium markets are beginning to receive market attention and not before time. The positive supply demand dynamics are leading to increased investment demand as seen in the ETF data and Chinese demand rising again due to both industrial and jewellery demand.
Source: Bloomberg, China Customs General Administration – (UBS)
Net platinum imports into China jumped to 8.9 metric tonnes last month, marking the strongest inflow in about a year according to UBS.
This reflected a 14% increase from March, and year-on-year growth of 29%. The trade data coincides with strong platinum volumes on the Shanghai Gold Exchange (SGE), which coincidentally also totalled 8.9 tonnes for the whole month of April, the strongest turnover since September 2011. The fall in prices towards $1,400/oz prompted a pick-up in physical buying.
Jewellery demand was cited by UBS as the main source of the physical buying.
While gold is still the more popular precious metal in China, platinum jewellery has also enjoyed an improvement in demand. Johnson Matthey estimates a 14% increase in net global platinum jewellery offtake last year, with China accounting for a large portion of the increase. The expansion in the number of retail outlets across second and third tier cities in China has contributed to the growth in platinum jewellery demand.
Although platinum’s discount to gold in 2012 did not necessarily translate into relatively cheaper platinum jewellery at a retail level, better margins would have encouraged sellers to exert more effort in promoting platinum. The surge in China’s platinum imports and increased SGE activity in April is a reflection of the physical demand response to the price drop, similar to that seen in gold.
Avg Known ETF Platinum Holdings – (Bloomberg)
Investment demand is likely to have received a boost from the announcement in March that Russia and South Africa, which together control about 80% of the world’s reserves of platinum group metals, plan to create a trading bloc similar to OPEC to control the flow of…
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Euphoria Cracks As Ben Drops Hint Of Tapering After All
by Zero Hedge - May 22nd, 2013 10:42 am
Courtesy of ZeroHedge. View original post here.
Submitted by Tyler Durden.
MOAR Orderly… oops… Bernanke: “Fed could reduce bond purchases in the next few meetings if data supports it” and perhaps most disturbing is that reality is finally seeping into the corner offices of the Marriner Eccles building when Bernanke says that concerns about “frothiness” and “bubbles” has increased? Was it the sub-5% yield in high yield that tipped them off?
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Central Banking’s Split Personality Can’t Go On
by Zero Hedge - May 22nd, 2013 10:34 am
Courtesy of ZeroHedge. View original post here.
Submitted by Pivotfarm.
Central Banking’s Split Personality Can’t Go On
Central bankers have spent the past five years expanding their balance sheets to unprecedented degrees. Now they have modest (at best) growth, but an enormous monetary base. Some want to do more but others are worried about how hard it will be to normalize policy. Nowhere is this split more apparent than in the Bank of England, although there are signs of the same at the Federal Reserve and even the Bank of Japan. Once again the BOE’s Monetary Policy Committee voted 6-3 against providing more quantitative easing to the economy, with outgoing governor Mervyn King on the losing side.
http://www.financialjuice.com/News/109287/Central-Bankings-Split-Personality-Cant-Go-On.aspx
Canada’s Bond-Dumping Frenzy Escalates as Pensions Unload
Canada’s biggest pension-fund manager will “significantly” cut its C$64 billion ($62.3 billion) allocation to bonds as the fixed-income market’s foothold among its most loyal base of investors grows less certain.
http://www.financialjuice.com/News/109279/Canadas-Bond-Dumping-Frenzy-Es…
EUR/USD Most Vulnerable Pair Ahead of Bernanke, FOMC Minutes
Most currencies have fallen against the dollar towards the testimony of Ben Bernanke in Washington and the release of the recent FOMC meeting minutes. Some had good reasons to fall and some didn’t have specific ones.
http://www.financialjuice.com/News/109278/EURUSD-Most-Vulnerable-Pair-Ah…
Schaeuble: EU must accelerate fighting youth unemployment
Cutting unemployment decisive for EU legitimacy German bilateral programs compliment EU efforts Schaeuble is speaking in Berlin.
http://www.financialjuice.com/News/109277/Schaeuble-EU-must-accelerate-f…
Lehman Brothers Holding raises $1.88 bln selling broker claims
Lehman Brothers Holding Inc, the former investment bank that is working to repay creditors, said on Wednesday it had raised $1.88 billion by selling claims it held against its former brokerage.
http://www.financialjuice.com/News/109266/Lehman-Brothers-Holding-raises…
Bernanke expected to stay the course on Fed policy
NEW YORK (Reuters) – Federal Reserve Chairman Ben Bernanke is not expected to hint at a pending policy change when he testifies before the U.S. Congress on Wednesday despite some speculation among investors that the central bank could soon reduce its massive bond buying program
http://www.financialjuice.com/News/109264/Bernanke-expected-to-stay-the-…
Credit rating firms sow doubt on euro zone bond rally
Credit rating firms say they could further downgrade the ratings of highly indebted euro zone countries, putting their bonds at risk of being pitched out of global indexes and reversing a fall in their borrowing costs.
http://www.financialjuice.com/News/109237/Credit-rating-firms-sow-doubt-…
US Existing Home Sales 4.97 within expectations.
The annual level of US existing homes sales was expected to rise to 4.99 million. This is a rise…
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Market Reacts As Bernanke Promises “MOAR”
by Zero Hedge - May 22nd, 2013 10:15 am
Courtesy of ZeroHedge. View original post here.
Submitted by Tyler Durden.
‘Orderly’…
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Will He Or Won’t He? Bernanke’s ‘State Of The Economy’ Testimony – Live Webcast
by Zero Hedge - May 22nd, 2013 9:56 am
Courtesy of ZeroHedge. View original post here.
Submitted by Tyler Durden.
Update: Bubbles Bernanke slams any hopes for tapering goodbye, as long predicted: PREMATURE TIGHTENING RISKS SLOWING OR ENDING RECOVERY
Bernanke’s quarterly hearing with the Joint Economic Committee this morning will be today’s must-see event (with FOMC minutes a close second). It seems the equity market has no fears but many in the high-yield market are anxious for the words ‘frothy’, ‘taper’, ‘bubble’, ‘clueless’, and ‘I plead da fif’. While Bernanke’s words will be the most important, these hearings typically include their fair share of ironic ignorant ‘humor’ from the politicians who sit in awe of the most powerful man in the world and his CTRL+P prowess.
Speech highlights:
- BERNANKE: PREMATURE TIGHTENING RISKS SLOWING OR ENDING RECOVERY
- BERNANKE REPEATS POLICY TO STAY ACCOMMODATIVE AS LONG AS NEEDED
- BERNANKE SAYS MONETARY POLICY PROVIDING SIGNIFICANT BENEFITS
- BERNANKE SAYS POLICY CAN’T FULLY OFFSET FISCAL DRAG ON ECONOMY
- BERNANKE: HIGH RATES OF UNEMPLOYMENT `EXTRAORDINARILY COSTLY’
Full speech:
The real Iron man:
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“No Tapering” – Bernanke’s ‘State Of The Economy’ Testimony – Live Webcast
by Zero Hedge - May 22nd, 2013 9:56 am
Courtesy of ZeroHedge. View original post here.
Submitted by Tyler Durden.
Update: Bubbles Bernanke slams any hopes for tapering goodbye, as long predicted: PREMATURE TIGHTENING RISKS SLOWING OR ENDING RECOVERY
Bernanke’s quarterly hearing with the Joint Economic Committee this morning will be today’s must-see event (with FOMC minutes a close second). It seems the equity market has no fears but many in the high-yield market are anxious for the words ‘frothy’, ‘taper’, ‘bubble’, ‘clueless’, and ‘I plead da fif’. While Bernanke’s words will be the most important, these hearings typically include their fair share of ironic ignorant ‘humor’ from the politicians who sit in awe of the most powerful man in the world and his CTRL+P prowess.
Speech highlights:
- BERNANKE: PREMATURE TIGHTENING RISKS SLOWING OR ENDING RECOVERY
- BERNANKE REPEATS POLICY TO STAY ACCOMMODATIVE AS LONG AS NEEDED
- BERNANKE SAYS MONETARY POLICY PROVIDING SIGNIFICANT BENEFITS
- BERNANKE SAYS POLICY CAN’T FULLY OFFSET FISCAL DRAG ON ECONOMY
- BERNANKE: HIGH RATES OF UNEMPLOYMENT `EXTRAORDINARILY COSTLY’
Full speech:
The real Iron man:
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