There is much consternation about what triggered today's rapid escalation of selling pressure in US stocks. As the evening wends on and traders sip their Absinthe, it appears an embargoed record of the Fed's Advisory Panel minutes was at least a major concern as it raised the very real specter that those in charge are concerned at the monster they have created:
"There is also concern about the possibility of a breakout of inflation, although current inflation risk is not considered unmanageable, and of anunsustainable bubble in equity and fixed-income markets given current prices."
"Unsustainable bubble"? And this not from some fringe blog but... bankers?
And some bonus words, which have to be read to be believed:
Uncertainty exists about how markets willreestablish normal valuations when the Fed withdraws from the market. It will likely be difficult to unwind policy accommodation, and the end of monetary easing may be painful for consumers and businesses. Given the Fed’s balance sheet increase of approximately $2.5 trillion since 2008,the Fed may now be perceived as integral to the housing finance system.
The US is on the cusp of a major and prolonged recession.
All the recent economic data indicates recession may have already just started - see the blue line. (It won't be reported as such for many months yet.)
Disposable incomes (income after tax) continues it's relentless decline.
Down over $50bn already this year.
Mainly due to the massive $200bn a year tax hike on the middle class and below, imposed in the Fiscal Cliff deal.
http://ian56.blogspot.co.uk/2013/05/the-relentless-decline-in-disposable.html
Mainly due to the massive $200bn a year tax hike on the middle class and below, imposed in the Fiscal Cliff deal.
http://ian56.blogspot.co.uk/2013/05/the-relentless-decline-in-disposable.html
But also because the official inflation numbers massively understate true inflation.
The price of basic necessities such as food & gas continue to rise.
http://ian56.blogspot.co.uk/2012/11/unemployment.html
The price of basic necessities such as food & gas continue to rise.
Contrary to media reports, job creation so far in 2013 has been anaemic to say the least.
Media pundits continue to talk up hopes of a recovery.
They are grasping at straws.
Even the recent 10% rise in house prices has been revealed to be nothing more than a dead cat bounce in the worst affected previously bubble areas.
The first entrant hedge funds who bought up tens of thousands of properties to rent out from 2009, are now getting out of the market.
Some people never learn :-
http://dealbook.nytimes.com/2013/06/03/behind-the-rise-in-house-prices-wall-street-buyers/
Some people never learn :-
http://dealbook.nytimes.com/2013/06/03/behind-the-rise-in-house-prices-wall-street-buyers/
Housing starts declined by 16.5% in April.
Mortgage applications declined dramatically this week - mostly due to substantial rises in mortgage rates in May.
Savings rates have declined to 2.4% as consumers struggle to keep their heads above water.
The money available for discretionary spending (after tax and paying for essentials like housing and food) is falling rapidly.
True price inflation is much higher than officially reported.
The Japanese stock and bond markets are already crashing due to their stupid policies of massive printing.
It will be a while yet before the rabid bulls in America understand the "recovery" is an illusion from Fed printing and a major and prolonged recession is coming (made worse by Fed policy).
The recession will worsen significantly in 2014 - made worse by the full introduction of Obamacare.
The multiple factors that will cause a US recession.
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