Quantitative Easing Is Dead ~ The Risk Averse Alert

Tuesday, August 16, 2011

Quantitative Easing Is Dead

Bravo those tricky Euro-marionettes! Their suggestion of a "financial transaction tax" might just fit perfectly with the massive consolidation of financial and industrial power about to sweep the trans-Atlantic. You can be sure, if ever there is such a tax, it will be a pittance. In no way would it detract from an endgame, which as I just said, ventures massive consolidation of power into private hands. Most likely would such a tax be but a carrot coaxing the public-private partnership arrangement offering the only hope that, those who purposely ventured the financial system's current, insolvent state, in fact, might win the day.

NOW HEAR THIS! Quantitative easing is dead. Sans any grease forthcoming from one FOMC meeting last week and today's hotly anticipated emergency heads of state meeting between euro lynch pin leaders Germany and France, it's time to start thinking differently than the pack.

Does anyone really think the likes of Texas Governor and Republican presidential candidate Rick Perry in publicly claiming Ben Bernanke's QE policy is borderline treason is but a loose cannon? A lot of hay was made about this today! Now the real news: it's official policy.

The bearded one no longer is needed. Nor might the bankrupt Federal Reserve anymore have a place, at least one resembling its present manifestation. Its days managing the illusion of setting interest rate policy appear over. From now on the real dictator of monetary policy all along — "the market" — probably only the more overtly will be calling the shots, and there will be no doubting this among honest observers over months ahead. The very demise of the Federal Reserve System could be at hand.

Which leads me to proof: The U.S. Congress' new, Joint Select Committee. How simple is that!

Most don't get it. The JSC's purpose is not so much to cut government spending as it is to make prostrate the U.S. Treasury. Symbolically, this already is accomplished with just the JSC's creation. Bought-and-paid-for jellyfish in Congress led by one fascist-in-chief have dutifully swallowed the bait. Now it's time to get down to business of rendering impotent the public sector of the United States.

That's why there will be no more quantitative easing. For Team Fraud the whole bailout thing was a one step backward operation only meant to grease the skids for what's next: massive consolidation of financial and industrial power into private hands. Two steps forward are to accomplish this.

First begins with congressional marionettes whose "Joint Super Committee" purposely is to act on the symptom (namely huge deficit spending) rather than the cause. No discussion in Congress about the real culprit: a hyperinflationary policy existing long before Bernanke's quantitative easing. Indeed, this began when the Bretton Woods system of fixed exchange rates was destroyed forty years ago yesterday by President Richard Nixon at the urging of his fascist Secretary of Treasury George Schultz. Rather lured to addressing only today's dire symptom Washington is prime to do its best "Schwarzenegger runs California into the ground" routine.

Like I said, most don't get it. The end to which we came in 2008 was intended — only Jamie Dimon has the gall to say "no one saw it coming." So too intended was the response from lenders of last resort: cultivating a useful "we must save this rat infested ship" political consensus, while at the same time issuing the coup de grace to the "full faith and credit" of the U.S. Treasury, luring it into backing the hopelessly insolvent arrangement disdainfully known in these parts as Adam Smith's Leveraged Ponzi Scheme.

So, now with the JSC completing the first step forward on the path toward massive consolidation of power, Team Fraud is ready to take its second step. Chaos unleashed upon every imaginable lap dog in both the public and private sectors. Per this latter group, let's not forget leadership here, too, was educated in the same esteemed universities as were many a jellyfish in Congress, as well as our despicable fascist-in-chief. No less cowardly, then, these nevertheless being similarly well-trained will fall with dignity, much as Congress and the President of the United States already have.

So, a little outside the box thinking tonight. It's more likely banks and financials were weak today not because of some phantom threat, but rather frightful reality. The virtual insolvency of most no longer can be denied within the framework of arrangements defining today's market-based financial system. It's time for convulsion, destruction, and asset grabs for pennies on the dollar. Thus does fundamental circumstance now arrived at with breathtaking speed have me siding all the more with Friday's view anticipating support turning resistance, stat.

(How long has CNBC had a "Sovereign Credit Default Swaps" page? There's now a link to this page under "My Research Assistants" way down in the left column. This probably will be something worth keeping an eye on over weeks and months ahead.)

Fast Money
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