Thursday, June 6, 2013

Ben and the taper

Moral: Wherein we digress further from our business of cosmology while we consider a new concept that has been pointed to as being behind a drop.

Taper? Yes, it's the same as unwind, remove the training wheels, and a number of other ways to look at the reversal of Ben's largess.

No doubt, Ben will talk goo-goo (baby talk) again, and the equity markets will soar (partly on the backs of the savers). How far can it go with Ben's assist?

Also, one source said that Ben doesn't like the use of taper. Okay? Why?


Actually, we ought to ask, how far ought it to go? We're in new territory, several ways. So, that gets us back to the post-Ben (new era) analysis that will come about. Too bad, this look back won't help Ben (as he told the Princeton crowd, recently -- actually, Economics does not even have 20-20 hindsight - but, then, who does? singularities (search "singularity") prevent this) extricate himself from a bad situation. Bad? Yes, junkies who are dependent upon his handouts. Talk about a sense of entitlement.

It goes like this: I, as an investor (playing in the ca-pital-sino), must (deserve to) have the Fed wrap itself around the axle (forgive the vernacular'ly oriented usage) in order to make things well for my kind at the expense of all other economic kinds.


Taper? or
Go cold turkey?
Now, back to the subject: taper. This implies some type of graduated approach. Ben might see this as being long with a slight, incremental change. You know, Ben, some see "cold turkey" as more advantageous. Consequences? No more than a tailored withdrawal. Besides, the memory of enduring the withdrawal might cause a little more reflection in the future before settling into another addiction. Wait! That type of thing may not be in Ben's worldview. I'll have to look more closely at his speech. There is one problem; he was trying to be humorous. The truth can be funny; but, many times, funny is very much untrue. Yes, one of those dilemmas that we find ourselves in.

The real crux? Ben knows what audience that he is playing to. But, patting fat cats on the back now may not add much of value to his long-term reputation.


02/11/2015 -- Wikipedia: Zero interest rate policy.

12/19/2013 -- Ben did his parting shot (whimper that it was); they're going to taper slowly, less than a 1/8th on the bond buy, starting next month. And, he's going to torture savers for another year or so. We'll have to see how the pieces fall. The markets got heavily seeded today in hopes of luring in the idiots and moms/pops (who cannot afford the pending losses). So, it's pop, fizz, ..., again. Too, we'll see more goo-goo talk to the immature markets and the addicted investors thereof. One of many technical issues that we'll have to get into: Nanex's view.

10/31/2013 -- Finally, a voice of reason. Just the headline tells the tale: Tapering without tears - how to end QE3 - by Ronald McKinnon, WSJ, 10/28/2013. Essentially, going to zero was an error. Thanks, Ben. There are too many negative effects. Besides, trying to control unemployment with that little knob (which Ben dialed to the maximum, early on -- see "out of bullets" discussions from 2008/9 -- which, by the way, was untrue as Ben creatively ventured into new areas, taking us down the perdition path). Actually, what he is trying to do is push string (try that for ringing a bell -- push needs to be changed to pull).

08/21/2013 -- I was wrong. I thought that Ben would go goo-goo, again, as his doves want him to do. But, there is talk of a taper, albeit slowly. Sheesh. No one does "cold turkey" anymore? That's how I quit smoking. Why is it that the FED feeds addiction (that's a monetary policy?)? Now, when does the slapping the face silly quit?

08/15/2013 -- FED siteFEDofNYPre-FOMC Announcement "drift"

08/07/2013 -- Investors? After the last taper talk (more than a month ago), things jiggled a bit. Some lost money. Some gnashed their teeth (but, for someone, like my ilk, who has been slapped silly for several years now, what comfort ought we give to those who don't know how to wean themselves from their addiction? --- in the meantime, Ben, we, the savers (saviors?), continue to be good citizens despite the Fed's attempt to trample us under the dirt). At that time, Ben had his Doves talk goo-goo. So, the mania began again. Yesterday, there was a slight downturn supposedly as some Hawk (or two) said, perhaps, next month there might be some fiddling with the taper (the talk wasn't that the investor would get reamed - forgive me, I was in the U.S.Army at 17 and learned some good lessons -- also, I was a medic so I know of orifices, to boot). Ben's problem is that he's in a fog (who isn't?). Yet, he runs around with the elite like an oracle (he ought to consider some of the Prophets about which he knows, perhaps), strokes the addicts, bends in to the money'd, and more. And, he looks for signs (omen analyzer -- ah, age-old behavior). And, he misses the obvious. For instance, what they're calling jobs (related to his triggers) are really just glorified indentured servancy roles. In fact, these things are to drive a consumer-oriented economy? ...

08/05/2013 -- Let's see. Financial Engineering needs some attention. Perhaps, with the likes of MIT involved, this discipline can learn to lead the way out of the morass. Expect more on this topic. If things continue as they are, markets will be pure chimera (as in, ca-pital-sinos). Investors? We'll go on about that, too. It's guaranteed that most in the equity markets will lose. Why is that not talked about by those heads we see daily yakking on TV and newer media? No, they would rather go gaga (apologies to the Lady). So, we'll have to address this issue: the point (price) at which loss outweighs any gains to date. All cannot sell to make a profit. Now, there is a way that all could sell high (government as the buyer of last resort - Ben has been doing this, albeit with bonds - yet, it frees up money that can go to equities -- government? of course, taxpayers). We'll have to look at the misuse of mathematics; plus, doers need to be brought back to a respectful position.

07/31/2013 -- Ben cannot unwind or taper downhe has too many Doves.

06/25/2013 -- Ben doesn't have to talk goo-goo. No, his hawks can do that. Today, the MN guy saying that they need to continue accommodation due to financial crises. Sheesh. Crises? When do they ever end? And, what about accommodating savers? Those who sold were the ones in early making "gains" almost beyond bound. It would be nice to have quiescence once to do an accounting (about as much a pipe dream - several reasons - as it is for someone on the Fed to argue for the little savers).

06/22/2013 -- So, how many traded their paper gain (chimera) to solid debt with the downturn? Okay, forget the size of the loser set, how much went from illusory gain (backed by a promise to pay later) to real debt that has to be paid with blood and guts? Wait! Some of those doing the margin calls, and ilk, have some way to weasel (not disparaging the grand animal) out, not doubt.

06/20/2013 -- Ben talked, the markets took a downturn (hey, go to 12K or less for the DOW, please). You see, he didn't say goo-goo and talk additional little goodies for the idiots. No, all he did was not throw in help (addicts will steal their own mother's assets) that is not needed; too, there was the slightest hint that, at some point, the idiots will have to stand on their own as adults (meaning, removing the gaming thrill and moving toward something more mature and sustainable). ... Of course, there have been these before. People call them corrections. Then, things get hot,again, as some want to explore new levels. All the while (this is from the beginning of equities, folks), the real measurements are far from getting attention. Look. Rigged markets? It's worse than that, as we've alluded to here since the beginning. ... However, to where ought we to go? That is not an easy question to answer. You see, the idiots have driven things this way a long time. Ben knows that as his academic work looked at the '30s (as in, 1930s). Why idiots? Well, it has to do with several things, not necessarily moral in context. We won't dance away from that, though. Perhaps, we could paraphrase Oscar Wilde's look at war as vulgar versus wicked. Same here. The types of things that seem so smart in finance are vulgar at their core. Why? They hurt people as much as bombs. The latter kills or maims you. Financial flimflam maims but in a more insidious way. No, these ways are not wicked, they're vulgar. We'll have to characterize that as we continue our look at cosmology.

06/19/2013 -- With computer-based trading taking such a big role, what does all of this gaming mean, day to day? Ben's word watched so closely? Is that not a funny thing? I wonder if he worries about the legacy that he will leave with his upcoming departure? There are two key factors to all of this: savers have been slapped silly (it's a wonder that there is any skin left on their face), these triple-digits upswings suck from a very large number of pockets (that is, near zero is the situation - with those running the game growing their pockets).

06/11/2013 -- So, volatility is back from its languid ways. Some see this measure as a risk indicator. ... It's interesting to watch the twice daily rationale given for ups and downs (example, today). Then, there is running commentary, daily. Some of it right on the nose. ... Ben ought to think about those who he's been sacking, namely, a large, important element (savers). The current means may lessen the load of debt for those who want to build their proverbial ball-and-chain, but it also encourages the run-amoks (especially, those who run after risk like junkies after the pusher (ought volatility be enough for them?).

06/06/2013 -- Ben hasn't spoken yet, on his tapering ideas. But, the DOW was losing, then it turned around. His group, the Fed, did say that American's net worth has regained ground (to around the 2007 level - before inflation). Nice (but, Ben's balance sheet is now tripled (or more) the size -- from which position he'll need to move, at some point). It was admitted, too, that it's the top 20 percent who are raising the level. So, do all boats, then, rise (or does wealth trickle down?)? BTW, please try to keep procto comments to the minimum.

Modified: 02/11/2015

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