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Word of the day: Yellenomics
I am waiting for the FOMC meeting tomorrow.
Now, if you define Yellenomics as being in the direction of tapering I would agree with you.
Gotta tell you Joseph, I think that the announcement tomorrow may surprise some of us.
Al, I haven’t bought cracker jacks for a long time so what do you think the surprise in the box will be. DT
Maybe a new bubble machine, I heard they’ve run out of Oscar Meyer’s weenie whistles, seriously Al what’s your take on the surprise package. DT
Seriously, I think (and it really doesn’t make a lot of difference right now) we will see, at least, a comment about “tapering will start next year”.
Who knows in this crazy world!
Yes Al. I agree. The Fed cannot withdraw from its stated intent to taper. They must keep the markets attention focussed on their agenda. The taper will come in stages. The suggested second in command to Yellen, Stanley Firscher, is already advocating withdrawal before he has even been appointed. He is a pretty respectable economist and we should take the message seriously.
Tapering, QE, Operation Twist – it is all a dog and pony show. When institutions are severly challenged they pull out all the stops to survive. We are in the “financial twilight zone”. The days of financial transparency and and fundamental price discovery is done. Kaput. Kapisch? (spelling)…I dont know..but you get the picture.
I do get the picture, Marc!
Pms down, if up, not much and not long.
What’s your prediction tomorrow?
Taper or no Taper?
For what it is worth, I think that they will allude to the fact that with the economic improvement, as they want the public to believe, we can begin to taper.
July 15, 2012 at 11:49 amI am about to apply for a degree cosure in the local U and can’t decide between applied Physics and mechanical engineering. I wonder which degree is more marketable in future. Reply
I don’t see much wiggle room for the Fed.
1. The Senate just passed a bill gutting the Sequester, which means even more deficit spending, which means more printing of money by the Fed to buy that debt.
2. The Christmas shopping season is starting to look like a bust, and large inventories in retail mean less revenues, less profits and a weaker economy going forward.
3. And of course we have Obamacare staring to take it’s toll on everyone but the insurance companies.
Good points, bj!
A reduction in stimulus will put tremendous pressure on the Treasury and Government to begin reining in spending. This is part of what is behind the move. Fed intervention has been a crutch that has allowed tough decisions to be put off to the future. Expected outcomes will be tax increases or program reductions. Do not doubt that. Monetary intervention cannot cure what ails this economy, only buy it time to heal.
LOL at gary predicting a rally tomorrow. Just do the opposite and you will make money!
Didn’t hear him predict that, I heard him say there was a possibility and not to put much at risk at this point.
On the contrary the stock market is starting to price in tapering, expect tapering and want tapering. This is there chance.
Do I think they will taper? No.
But whether they do or not stocks go up.
Gold still needs that $100 to $200 move to finally drive the stake in the heart of the few remaining gold bulls.
small bets? lotto tickets? sounds like a racetrack..come on 7!
We will know in about 24 hours!
A racetrack might make more sense!
makes more sense to me
tomorrow I expect bernanke to claim victory and take a victory lap.
he will say they have seen significant improvement in the economy, unemployment has come down, inflation is contained.
he will then state he want to see this for more than just one quarter however and is prepared to keep everything the same for now, with march a possible target for tapering
That is a logical point The Greater!
Tomorrow will not bring the taper.The Feds target unemployment rate hasn’t been met.
I don’t know man, they published 7% (as unrealistic as that is) and I would think they would be jumping up and down.
The president has got to be gloating right about now.
handicapping this taper is a fools errand. They have a plan and they are sticking to it and it may or may not have tapering in it. They cannot afford a run up in interest rate before year end. Too many questions would arise. having said that, the Fed Governors have great educations but they are prone to making mistakes. Tomorrow could be another mistake.
I am on the record as saying “NO TAPER” tomorrow
A mention of it is an entirely different story.
I just did an analysis of what the sequestration really means to the military establishment….There are going to be massive layoffs of military contractors and civilians in 2014 as well as cuts in active duty military. Unemployment is going to go up and I think that will be a reason to not implement a Taper….however, they may still talk about one like they did in September….2014 is going to be really bad for our economy and potentially really really good for PM if it is viewed as a safe haven when everything else starts to wobble.
Cutback in military expenditures are a signal tapering is coming.
That, Jon, could spell trouble. Don’t you think so?
Not sure how you can connect the two?
Interesting point, The Greater.
Major cutbacks in military during this administration does concern me. Related or not.
The new 2 year Budget deal spares the DoD from sequestration spending cuts. This is why the republicans agreed because they are beholden to their corporate military companies/friends and the Pentagon’s plans to eventually take over the entire Middle East and more. Paul Craig Roberts has a tremendous article of what is really going on. Don’t dismiss this – it is in the process of happening.
Washington Drives the World Toward War: http://www.paulcraigroberts.org/
World war 3 is coming and a complete collapse..DARK AGES. Dont kill the messenger. ALSO BITCOIN WAS A SUCKERS SET UP. IF YOU WANT TO BET YOUR MONEY….BET ON A RARE COIN. If you dont pay to much from these dishonest dealers, in 20 yesrs the coin will be worth many times over what you paid. BUT NOT BITCOIN IMVHO…..Its down another 15 perc. today
I hope they do taper, for this reason: the quicker they taper, the quicker they will realize that the economy could not absorb it.
As rates go higher and impact the housing market, consumer borrowing and interest payments on the national debt, the Fed will reverse course and launch even greater amounts of QE.
Remember, that in the two lost decades in Japan, there were many period in which the Japanese erroneously thought that things were on the mend. Periods in which the Nikkei stock average put in very large rallies. But always to sell off again and always another iteration of QE.
We have followed the Japanese playbook the entire time. Japan recently launched the mother of all QE — putting their own currency at risk of imploding. We will eventually do likewise.
Gold longs are taking it in the bunghole. I know where its going too. Just below $1000.
Bunghole is right! I took it in the bunghole after listening to Gary when I was a subscriber. Now I’m actually making money ignoring twits like Gary who haven’t the slightest idea of the big picture as he looks at his cycles that he makes fit after the fact. Yes, cycles are a good way to go, just not Gary’s cycles. Much more logical and big picture cycles that take into account world markets and trends like the ones Martin Armstrong charts, make sense. He won’t always be right, but he’s been right so far regarding gold, and most drooling goldbugs, like the kind I once was, still call him nuts. Good luck following the Garys of the world who don’t know their ass from their elbows.
I don’t know of any goldbugs that think Martin is nuts, but I don’t think we’ll see gold under $1,000. He and Jim Rogers have made that expectation very public and it is therefore less likely. $1155-$1125 seem like the worst case scenario to me. $1155 is the 61.8% Fibonacci retracement of the move from the 2008 low to the 2011 high. $1155 is also the late July 2010 low just before Ben’s Jackson Hole speech in which he said “The Federal Reserve is already supporting the economic recovery by maintaining an extraordinarily accommodative monetary policy, using multiple tools. Should further action prove necessary, policy options are available to provide additional stimulus.”
$1182 was the monthly high close for 2009.
Wherever gold goes next, it is a good value right now.
Compared to some pretty good trader’s free blog out there, his service is worse than worthless, if not much worse.
These guys must be on break while gold breaks down. Here is a great read while we are waiting for life support!
I just called Gary Savage and asked him what he did with the money. He said, “what money?” I said the money your parents gave you for your economics class. Bra ha ha!