Financial topics

[vincecate]

Imagine that Disney started buying up lots of land in Okinawa to where they were the buyer in half the land sales this month. We all would expect the prices of land in this part of Okinawa to go up, right? Now imagine that Disney announced that they were not going to build a park after all and would be selling the land they had bought. We would all expect the price of land in this part of Okinawa to drop, right?

Now the Fed was the main buyer of US government bonds. They have a stated policy of lowering interest rates, which really means they have a policy of driving the price of bonds up. Now if they said, "hey, we are not going to be buying so much", we would expect the price of bonds to go down, right?

Bernanke is puzzled that the price of bonds has been going down so much after he hinted that the Fed may not be buying so many bonds.

"We were a little puzzled by that. It was bigger than can be explained, I think, by changes in the ultimate stock of asset purchases within reasonable ranges, so I think we have to conclude that there are other factors at work, as well, including, again, some optimism about the economy, maybe some uncertainty arising. So I'm agreeing with you that it seems larger than can be explained by a changing view of monetary policy." Bernanke.

http://gonzalolira.blogspot.com/2013/06 ... rease.html

And people think that US bankers are so smart they would never get into a hyperinflation situation.

[aedens]

http://www.ornl.gov/info/press_releases ... 0130605-00

Thought map is if they can consolidate current floor space to ramp up production already paid by the tax mules.
Since we already paid over 250k per capita for the current vehicle will they drop one off since the taxpayer already paid for it.
I still find it interesting the internet was paid for by us and they still cannot fathom they did not build that either or pay for it
since morse code. Of course later it was funded by Congress.

"This game-changing shift from liquid to solid electrolytes eliminates the problem of sulfur dissolution and enables us to
deliver on the promise of lithium-sulfur batteries.

We also noted the molten salt banks on electrical storage units from TED from the MIT project and will take the time to look that up
again but the GE monsters are sitting on it also. I am still deciding on the nano paint that kill mrsa on contact since it
ruptures the cell membrane. The effect was when the specific cell structure touched the latex and nano additive it was destoyed.
Did it penetrate other structures, not what I seen from initial findings released.

The material was successfully tested at Albany Medical College, where another researcher maintained strains of MRSA.
"At the end of the day we have a very selective agent that can be used in a wide range of environments—paints, coating, medical instruments, door knobs, surgical masks—and it's active and stable," Kane says. "It's ready to use when you're ready to use it."

We have only begun to learn if the idiots do not turn us all to water vapor as mindless children.

[aedens]

http://www.federalreserve.gov/releases/h41/

Should clear up soon since mid year sweeps and margin blowouts clean out the non swimmers as noted along the way as many others. As noted some time ago twice yearly in myth and yarns of the banksternista's needs deposits to look pretty for be under the radar of the you know whos. You can see how the Asians dealt with it. Resume your posture as carry trades if you survived the notation from them to knock it off your not a value added player which goes into the no kidding department of affairs and the addage try living with out it and the love of it leads to so many thought maps. Carry on paper tigers.... Value is Ethics

Removing stones from the river: http://www.zerohedge.com/news/2013-05-0 ... ally-works

http://www.coyoteblog.com/coyote_blog/2 ... refut.html

Look around the world - for any country, ask yourself if the average person in that country has the open intellectual climate that encourages people to think for themselves, and the open political and economic climate that allows people to act on the insights their minds provide and to keep the fruits of their effort. Where you can answer yes to both, you will find wealth and growth. Where you answer no to both, you will find poverty and misery.

Leave us alone

[aedens]

I must observe theBDI and observe in silence the lovely tree in the forest.
http://gdxforum.com/forum/viewtopic.php ... ons#p15708
FXI & Baltic Exchange Dry Index (BDI) reads a straight line.
X files theme song here on that bias....

Meanwhile,
Only when the last tree has been felled, The last river poisoned, The last fish caught,
Will you recognize that you can't eat money.
-Cree-

[aedens]

All of this has left traders and investors scrambling to protect themselves in anticipation of a volatile summer from the lame stream press.
I watched CBS news and the economic report was insane blather.

What a pack of Jackals in the natural economy based on deceptions. Dr. Ben was corect in his view and I seen they got hooked for 14 percent of MBS and if I remember the number correctly from the CRA scam and not to mention they will vote for 200 years for democrats. Not that 100 years of scientific voodoo even Fisher dispelled in his epoch as rain dancing of surreal madness of the enmass. Higg was correct on the chaos nature as a flock of birds moving in unison of a void called atmosphere we noted a few times on quants, HFT and physics. This was the nature of the observation of the ai algos.

However, since capitalists must compete to survive, if their competitors resort to unethical actions that give them an advantage over the ethical company in the short run, the long run benefits will never be achieved and everyone suffers. The fact is the vast majority of men and women are not entirely ethical.

As noted "I am only a child playing on the beach, while vast oceans of truth lie undiscovered before me". Isaac Newton
http://www.pa.msu.edu/courses/2008sprin ... onHair.pdf

[gerald]

Detroit Recovery Plan Threatens Muni-Market Underpinnings

http://www.bloomberg.com/news/2013-06-1 ... nings.html

“Economic reality, such as Detroit’s shrinking population and tax base, does impose a limit: Once all the blood is squeezed from the stone, you are unsecured.”

---------------------------------------------------

Will the fed bail them out? -- Will the fiscally prudent complain? Will / can the fiscally prudent do anything about a bailout?

Pensions depending on muni-bonds -- what next?

Interest on muni-bonds will do what?

This could get interesting and in not a nice way.

[John]

I've updated my Price/Earnings Ratio chart:

[Higgenbotham]

MUB - Municipal Bond Fund ETF

MUNI BONDS.gif (17.47 KiB) Viewed 2786 times

[Higgenbotham]

6) The December level was 3.3% and equal to the historic low set in March 2012 and July 2011. Cash levels have been in a range of 3.4% - 3.8% since July 2010 as stock prices have continued to rise. This is quite different from prior history and is evidence of the Fed propping up the market. This cannot continue indefinitely. When Fed support ends the market is facing a long decline similar to 2000-2002 and 2007-2009 (40-60%).

7) The April level was 3.8% with the S&P at 1,597.57.

http://home.comcast.net/~RoyAshworth/Mu ... Levels.htm

Jun 21, 2013 12:31 PM CT

Federal Reserve Bank of St. Louis President James Bullard said the central bank may need to increase monthly asset purchases above the current $85 billion pace if inflation slows further below its 2 percent goal.

The Federal Open Market Committee “will face a decision if inflation continues to decline,” Bullard said today in a telephone interview from Washington. “Then the committee will have to make a decision about how to provide more accommodation.”

http://www.bloomberg.com/news/2013-06-2 ... er-2-.html

On when he thinks the Fed will start to taper QE and when investors need to start trading on that:

"Based on what he said, based upon what the Fed estimates have given us in the last hour it suggests that yes, towards the end of the year, as we hit 7.25%, and if inflation rises as opposed to stays at 1% that the Fed would begin to taper and that ultimately they would end tapering in perhaps the first quarter of 2014. Is that a realistic possibility? At PIMCO, we don't think that really is. We think the chairman and the Fed are taking a very much of a cyclical type of view. He blames lower growth on fiscal austerity and expects towards the end of the year once that is gone, all of the sudden the economy will be growing at 3%. He blames housing prices moving up on homeowners that simply like higher home prices as opposed to emphasizing the mortgage rate, which is really what has provided the lift in the first place. To certain extent his driving analogy, which he talked about pulling back on the accelerator, I think he might be driving in a fog. I think the Fed itself may be driving in a fog. To think that is a cyclical as opposed to a structural problem in terms of our economy. I simply think and PIMCO thinks that real growth to lower unemployment below 7% is a long shot over the next 6, 12, 18 months."

http://www.safehaven.com/article/30211/ ... g-in-a-fog

It's fascinating how the goal posts have moved quickly on the Fed's playing field. Months ago the conversation focused on the "exit strategy" it would use to unwind the trillions of bonds and mortgages that it had accumulated over the last few years. Despite apparent improvements in the economy, those discussions have given way to the more modest expectations for the "tapering" of QE. I believe that we should really be expecting a "tapering" of the tapering conversations.

I expect that the Fed will continue to pantomime that an Exit Strategy is preparing for a grand entrance, even as their time line and decision criteria become ever more ambiguous. The Fed's next big announcement will likely be to increase, not diminish QE. After all, Bernanke made clear in his press conference that if the economy does not perform up to his expectations, he will simply do more of what has already failed.

http://www.safehaven.com/article/30230/ ... taper-talk

[Higgenbotham]

Chairman Ben S. Bernanke Federal Reserve's exit strategy
Before the Committee on Financial Services, U.S. House of Representatives, Washington, D.C.
February 10, 2010

In the long run, the Federal Reserve anticipates that its balance sheet will shrink toward more historically normal levels and that most or all of its security holdings will be Treasury securities. Although passively redeeming agency debt and MBS as they mature or are prepaid will move us in that direction, the Federal Reserve may also choose to sell securities in the future when the economic recovery is sufficiently advanced and the FOMC has determined that the associated financial tightening is warranted.

http://www.federalreserve.gov/newsevent ... 00210a.htm