The Fed's statement today

Question

just so we can be clear about what we are doing

the us treasury floats debt, our federal reserve is now openly acknowledging that it will print money and buy that debt or up to 300b. plus it is buying 1.25 T in mortgage backed securities (more debt)

holy shit

get some UDN boys...will be a bumpy ride

when government capital gets involved in anything it crowds our private capital. we see that in the banks and now we'll see it in treasuries

im waiting for the markets to fully digest this along with our president's spending plans and then throw up all over the place probably tomorrow or friday

can someone tell me where we are getting this money from? how can we continue to print trillions and buy our own debt?

KOAJ · Answer

just so we can be clear about what we are doing

the us treasury floats debt, our federal reserve is now openly acknowledging that it will print money and buy that debt or up to 300b. plus it is buying 1.25 T in mortgage backed securities (more debt)

holy shit

get some UDN boys...will be a bumpy ride

when government capital gets involved in anything it crowds our private capital. we see that in the banks and now we'll see it in treasuries

im waiting for the markets to fully digest this along with our president's spending plans and then throw up all over the place probably tomorrow or friday

can someone tell me where we are getting this money from? how can we continue to print trillions and buy our own debt?

KOAJ · Answer

holding my TBT (short treasuries) and may buy more

our current path is unsustainable, crowding out private and potentially sovereign capital in our treasury market will mean that we are funding our own insanity with monopoly money

wallstreetcappers · Answer

Koaj,You know my opinion..you cannot base the action on treasuries only by the issuance and debt of the country..if there arent better alternatives available people wont sell them even if your theory is correct.

KOAJ · Answer

wall - the chinese have already been rattling cages and announced they will devote future resources to oil rather than fx in us dollars

i just hope i can buy a house before the dollar collapses. i look forward to making a mortgage payment with a loaf of bread

wallstreetcappers · Answer

Come on with that, you are literally comparing the USD to the Peso when other currencies were strong.

The fact is that this problem is worldwide, so relative to the rest of the world, the US is still very strong..even with what the Fed is doing.

I am curious if this COULD have a major inflationary impact..part of me thinks yes and part of me thinks since the rest of the world is a step behind us that it wont happen like it could.

KOAJ · Answer

i wish i knewthis may work in a textbook or in bernanke&#x27;s thesis but in the real world, things dont function according to their model. people freak out and convert their cash to gold

wallstreetcappers · Answer

yeah I need more signs outside the printing press to confirm what guys like CC are saying regarding gold.

If that theory were correct the demise would spread to other areas and it really hasnt happened.

With the technology we have and efficiencies we have as a country and world, trying to draw comparisions to past implosions just isnt easy to do.

KOAJ · Answer

agreed...however we (humans) have done this before (printing money hand over fist and spending tons of government cash)

Weimar, Great Depression, Japan 1990s

we are attempting to do all 3 right now yet are broke as a nation. funny how soros is around more than he used to be. he knows a thing or two about shorting a currency

wallstreetcappers · Answer

Soros needs to be careful, arent you shocked that the greenback hasnt imploded yet?

I think it is incorrect thinking trying to compare the past and think it is a foregone conclusion that the USD gets smashed and has to be devalued..I just dont see it and if Soros gets cocky he will get smashed.

KOAJ · Answer

this is soros&#x27; perfect storm...he can short the dollar into oblivion and can have his puppet running the country

wallstreetcappers · Answer

Koaj,If Soros gets cocky he will get burned badly..The USD is 30 cents from a 30 yr high vs the CDNThe USD is smack in the middle of the low/high vs the Euro.Which pair would he be shorting, the US/Yen?I dont see any other pair that has been hit that hard honestly.

claycourtlesson · Answer

The first step to get out of this financial mess is this....&#xD;&#xA; &#xD;&#xA; &#xD;&#xA;NO GOVERNMENT HELP&#xD;&#xA; &#xD;&#xA;Let markets be markets.  Expect and accept failures.  The strong survive, and the weak do not.&#xD;&#xA; &#xD;&#xA;Japan in the early 90s proves clearly that government intervention does not work.&#xD;&#xA; &#xD;&#xA;Let&#x27;s face it.......right now, there is no light at the end of the tunnel whatsoever.&#xD;&#xA; &#xD;&#xA;Obama and his cronies are terrible, damnable and absolutely hellish.

KOAJ · Answer

that is the only way that works clayno printing money, no bailoutsif companies are going to fail, let them fail gently to avoid systemic collapse

KOAJ · Answer

im waiting for the markets to fully digest this along with our president's spending plans and then throw up all over the place probably tomorrow or friday
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gold up 7%, silver up 13%, oil up 6%

equities negative...FU Ben, FU Barry

claycourtlesson · Answer

Yeah, Koaj, once subprime fell apart in late July &#x27;07, and then Scholar Ben hit the panic button and threw open the discount window and slashed rates like there was no tomorrow, "BAILOUT PACKAGE TSUNAMI" began.&#xD;&#xA; &#xD;&#xA;And look it now......"US Congress" spending all farking Thursday debating about "AIG Bonuses."  Makes me want to farking puke.&#xD;&#xA; &#xD;&#xA;.......................................&#xD;&#xA; &#xD;&#xA;No light at the end of the tunnel, whatsoever......unless you like hyperinflation, socialism, 24/7 surveillance.

KOAJ · Answer

ccl - keep an eye on AAUK...very smart man took an 11% stake in the company the other day

TILTOLOGIC · Answer

This is Banana Republic-type stuff! And I’m not talking about the clothing store. Printing money out of thin air at the central bank, only to turn around and buy debt securities issued by your Treasury, is the kind of practice you typically see in emerging market regimes.

What farking joke we have become.

And I love how we continue to flip the bird to our foreign creditors....a dangerous path to tread considering we’re a net debtor nation that’s trying to borrow tens of billions of dollars a month to fund our massive deficits.

Yeah you definetly got things under control Barry

KOAJ · Answer

we are turning into zimbabwelong TBT...dont worry about the $3 sell off the other day

LeRinkRat · Answer

What farking joke we have become. &#xD;&#xA; &#xD;&#xA;been working on that joke for the last three decades

Aeternus2006W · Answer

I really hope you guys don&#x27;t still hold dollars.The dollar is screwed. Once the deleveraging and mass liquidation is finished, hyperinflation will hit like a monsoon.Gold, silver, mix of different currencies, tangible items, food, alcohol, guns, ammo etcetera etcetera etcetera..........What is so hard to understand about this? I&#x27;d rather have a mix of those items than trading in dollars 2:1 for the Amero. Or worse.

Aeternus2006W · Answer

Also, sure, buy UDN and short the dollar, great, but, what if the dollar really does drop to ZERO, all those shares, well, the fund actually, may not exist. POOF!

Although, even If the dollar does not drop to zero and actually holds some value, I have a hard time believing that the gains would be able to keep up with the inflation, you might break even, maybe A small loss.

I dunno.

KOAJ · Answer

to your point windir. the wife and i have been looking for a house for 12-18 months. last summer i told her family i would like to sell our place and then buy another (on the cheap) but before the dollar collapses.

they looked at me like i had 3 heads

Aeternus2006W · Answer

KOAJ - Man, that is about as hard A thing you can do, I mean, timing that would require some serious skill or luck.

Selling your place while the prices keep going down than waiting and buying A new place at A lower price, but to the point where the dollar still holds enough value to buy A nice house at that discount, phew, that is tough. That is like shorting the housing market and going long on the dollar at it's absolute bottom before it disappears into oblivion, like a straddle on an option.

I hear ya man, Sounds good to me, hopefully you can get to realize that American dream without getting screwed over on it in the process.

Challenging times indeed......

But yea, some people just can't grasp the seriousness of the situation, I suppose CNN and people like Suze Orman telling people that everything is at fire sale prices and they'll make millions of dollars buying down here doesn't help either. They conveniently neglect to tell everyone that the market was over-inflated to begin with and that maybe these prices are truer to book value than they ever were before and never will be again in the not so distant future.

wallstreetcappers · Answer

You guys drive me crazy.The only way the dollar devalues is if the other currencies are STRONGER than it.So yeah what you are saying is theoretically correct but you arent factoring in that most EVERY country (maybe outside Japan since they already went through this and are not as involved) are just as hip deep as we are. So in order for your gloom and doom theory to work, there has to be a stronger counter-currency.So which currency is going to be stronger that the dollar will devalue RELATIVE to that currency? The Euro? The Pound? The CDN dollar? The Swiss Franc? Outside the Yen I dont see a dominant currency that the economy of that country will push the USD lower.The conclusion is that this situation we are in is not normal, in the past when one currency is hyper printed, the other currencies werent and thus the said currency got smashed..like the Mexican Peso..but as bad as the USD is, it aint much better in the other LARGE countries and their currencies arent going to fare much better.Think about the global picture, not just that the USD is getting printed like crazy.Also..inflation will not happen as you think..to have hyper-inflation the DEMAND has to be there..if there is no demand, prices cannot inflate even with an abundance of currency.You cannot just draw a conclusion because you took an Econ class and that it happened to another country 15 yrs ago, this is a completely unknown situation that MOST major currencies are in the SAME predicament..

wallstreetcappers · Answer

Just found this-linkI dont want to sound bullish but if you get private investors into the situation here, match buck for buck and share the profits..well it could be a HUGE deal and could seriously move these banks higher.

The Fed's statement today

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