Thursday, December 5, 2013

Parting shots

Moral: Wherein we review Ben's put given his imminent departure.

What parting shots will we see in the next two meetings? More slapping silly of the savers? What will Janet do?

It's obvious that Ben's view is tuned more to the fat cat bankers than to the economy as a whole. You see, he may say that he's playing with his knobs in order to get employment up. But, in reality, what we see directly follows his decisions and actions. And, his disinterest in how things are different now, than in the '30s (his bailiwick), can be troublesome.

All he has to do is look at how computation has changed in the past decade and how it influences (actually, drives -- yes, Ben, DRIVES). Given that look (assuming that he sees), he would say, wait a minute. But, we can't just stop the wheels. You see, the stuff stinks (to high heaven - unethical to the core).

Well, we could have in the 2007/8 time frame. I would bet that things would not be any worse off than they are now had banks been nationalized. In fact, things may have been better. But, that wasn't to be since there is this strong belief in the invisible hand (oh yes, Ben's was more visible than was Alan's) plus the fetish that came from kissing up to Friedman (several senses: this one plus the notion of the FED pushing string as being analogous to applying control).


Now, the image shows things from early to now. That is, from the 2008 focus, and panic (when some thought that Ben has shot his wad), to the heady days of an inflated (granted, overall, there is an inflation gradient that is less than desired - however, with equities having the attention, these markets have been able to shift money from savers to gamblers) market (yes, Ben showed how clever he could be in his manipulation of what is the public's trust). Yet, the Bens and the Janets of the world see no issue (oh yes, the guy who looks at houses - big name - says that he sees no bubble, but there is froth - what the heck is froth? is it not mostly air?) with that (slapped silly for five years with no end in sight - torture?). Ben talks a little taper; the addicts go insane; Ben, then, talks goo-goo to calm them down. Savers (besides the usual set, there are those who have to plan future payout using minuscule returns - a whole set that includes pensions, insurance companies, and such)? Well, savers are being trampled by those who are lining up for almost ad infinitum easy money. Of course, that money is not free; at some future point, there will be cries of anguish as debt load becomes intolerable.

Aside: Let me tell you about one saver. Not only has there been nothing earned for his little accumulation, but he has a  mortgage that he has kept up payments on. By the way, there has been no thank you from anyone in that regard - namely, five years of on-time mortgage payment plus paying the banker a little over 5.0% on the principle owed. For the accounts that the same bank has of the guy's money (as in, being on the credit and not debit side), there has been payout less than 0.5%. Yet, the guy endures since he believes in supporting the economy, even when those like Jamie get the attention (oh wait, some of his gold has lost its luster, of late). Yes, none of the bailout initiatives are of use. The thing isn't under water (good planning on the saver's side - except for not thinking about the likes of Ben). Too, except for paying off the mortgage, there is no other gain (why entrench into another yoke?) that can be done. From time to time, the saver has heard of people having their mortgages just waived away. Then, the likes of Summers talks about having negative interest (the saver has already seen that with savings bonds where supposed payout by Uncle Sam has diminished to insult level).

Now, back to savers versus gamblers. Without a stable value concept, savers cannot expect to have their future payout. It's easy to understand this. But, those who want to play games in order to rake in ill-begotten gains have perturb'd the issue. But, too, the reality is that the gamers get people to put their money into the system so as to take profits off the top. As sellers outweigh buyers (during the time when people want to profit), the water level goes down such that there are guaranteed losers (of a very large cardinality - plus, the magnitude of the losses for this large set is tremendous - but, such suckers (like cannon fodder) are given to the fat-cats/gamers as gifts to exploit). All the talk of equities lifting things is not true. It's a chimera. Were the real reports allowed to be shown daily, this would be obvious (oh, will accounting own up to this?). Real? Yes, those that account for near zero.

Remarks:  Modified: 12/19/2013

12/05/2013 -- If only Ben would put a shot across the bow.

12/09/2013 -- Back in the time of the turmoil, when Ben was thinking of his easing (which ended up as QE infinity), he talked about getting the green shoots some attention. As in, help the economy grow. Well, he has done that. That trouble is that he hasn't applied his weed whacker. We now have a raging jungle where a nice garden would be more appropriate. Well, history will tell us how good of a gardener Ben has turned out to be.

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. Ben does get his print space.

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