Comments on: The Fed Can Do That? http://dailycapitalist.com/2009/09/01/the-fed-can-do-that/ Economics, Finance, and Investment Risk Fri, 10 Sep 2010 19:08:17 +0000 hourly 1 http://wordpress.org/?v=3.0.1 By: Jeff Harding http://dailycapitalist.com/2009/09/01/the-fed-can-do-that/comment-page-1/#comment-4196 Jeff Harding Mon, 29 Mar 2010 17:50:20 +0000 http://dailycapitalist.com/?p=1736#comment-4196 Thanks, I'll check this out and get back to you. Thanks, I’ll check this out and get back to you.

]]> By: Rob P http://dailycapitalist.com/2009/09/01/the-fed-can-do-that/comment-page-1/#comment-4190 Rob P Mon, 29 Mar 2010 10:17:54 +0000 http://dailycapitalist.com/?p=1736#comment-4190 Jeff: I'm a bit late in reading your excellent article, but there's a good reason for that. I came across your work after stumbling upon other later analysis of Fed trickery by Sprott Securities. It's work that strongly reinforces and even amplifies your own insights.(Link: http://www.sprott.com/Docs/MarketsataGlance/12_2009_MAAG.pdf) Simply put, Sprott has recently figured out that the "Household Sector" support for Treasuries at auction is does not actually mean US households. The term "household" is simply a euphemism for a catchall bucket. Sprott: "Amazingly, we discovered that the Household Sector is actually just a catch-all category. It represents the buyers left over who can’t be slotted into the other group headings.... So to answer the question - who is the Household Sector? They are a PHANTOM. They don’t exist. They merely serve to balance the ledger in the Federal Reserve’s Flow of Funds report." So, it seems to me that as worrying as your own analysis is, even its one bright spot - that US citizens were now funding their own deficit - is in fact an illusion. US households are not buying this garbage! Doesn't that explain why Treasuries are only 1% of household assets?! It appears the Fed is monetizing in more ways than one. The Fed can do that, but if this keeps up, pretty soon, only the Fed will love the Fed. Am I missing something? Rob Jeff: I’m a bit late in reading your excellent article, but there’s a good reason for that. I came across your work after stumbling upon other later analysis of Fed trickery by Sprott Securities. It’s work that strongly reinforces and even amplifies your own insights.(Link:
http://www.sprott.com/Docs/MarketsataGlance/12_2009_MAAG.pdf) Simply put, Sprott has recently figured out that the “Household Sector” support for Treasuries at auction is does not actually mean US households. The term “household” is simply a euphemism for a catchall bucket. Sprott: “Amazingly, we discovered that the Household Sector is actually just a catch-all category. It represents the buyers left over who can’t be slotted into the other group headings…. So to answer the question – who is the Household Sector? They are a PHANTOM.
They don’t exist. They merely serve to balance the ledger in the Federal Reserve’s Flow of Funds
report.” So, it seems to me that as worrying as your own analysis is, even its one bright spot – that US citizens were now funding their own deficit – is in fact an illusion. US households are not buying this garbage! Doesn’t that explain why Treasuries are only 1% of household assets?! It appears the Fed is monetizing in more ways than one. The Fed can do that, but if this keeps up, pretty soon, only the Fed will love the Fed. Am I missing something? Rob

]]> By: Iran replaces Dollar with Euro - Business, Finance, and Investing - Page 3 - City-Data Forum http://dailycapitalist.com/2009/09/01/the-fed-can-do-that/comment-page-1/#comment-3353 Iran replaces Dollar with Euro - Business, Finance, and Investing - Page 3 - City-Data Forum Mon, 28 Sep 2009 05:19:42 +0000 http://dailycapitalist.com/?p=1736#comment-3353 [...] is an interesting analysis on this issue at: The Fed Can Do That? | The Daily Capitalist Basically, the market for U.S. Treasuries is more dependent upon U.S. buyers right now, including [...] [...] is an interesting analysis on this issue at: The Fed Can Do That? | The Daily Capitalist Basically, the market for U.S. Treasuries is more dependent upon U.S. buyers right now, including [...]

]]> By: Fin/Inv » Blog Archive » Guest Post: Economic Megatrends That Will Drive Our Future http://dailycapitalist.com/2009/09/01/the-fed-can-do-that/comment-page-1/#comment-3332 Fin/Inv » Blog Archive » Guest Post: Economic Megatrends That Will Drive Our Future Wed, 16 Sep 2009 13:57:27 +0000 http://dailycapitalist.com/?p=1736#comment-3332 [...] [...] [...] [...]

]]> By: Guest Post: Economic Megatrends That Will Drive Our Future | Froogalizer.com http://dailycapitalist.com/2009/09/01/the-fed-can-do-that/comment-page-1/#comment-3322 Guest Post: Economic Megatrends That Will Drive Our Future | Froogalizer.com Tue, 15 Sep 2009 23:25:06 +0000 http://dailycapitalist.com/?p=1736#comment-3322 [...] is obvious where the money will come from to pay the debt. I doubt the debt will be entirely funded by monetization (printing dollars). It would worsen the problem and lead to high inflation and Obama’s [...] [...] is obvious where the money will come from to pay the debt. I doubt the debt will be entirely funded by monetization (printing dollars). It would worsen the problem and lead to high inflation and Obama’s [...]

]]> By: Jeff Harding http://dailycapitalist.com/2009/09/01/the-fed-can-do-that/comment-page-1/#comment-3300 Jeff Harding Wed, 02 Sep 2009 17:47:20 +0000 http://dailycapitalist.com/?p=1736#comment-3300 Lloyd, I've given your question a lot of thought and still don't know the answer. I think it's actually both. Let's assume that they are all well meaning individuals who wish to do the right thing. If so, they are ill informed and ill educated and it will harm us either way. As one of my friends says, "Believe what you see, not what you hear." It's hard to do. Lloyd, I’ve given your question a lot of thought and still don’t know the answer. I think it’s actually both. Let’s assume that they are all well meaning individuals who wish to do the right thing. If so, they are ill informed and ill educated and it will harm us either way. As one of my friends says, “Believe what you see, not what you hear.” It’s hard to do.

]]> By: Lloyd G. http://dailycapitalist.com/2009/09/01/the-fed-can-do-that/comment-page-1/#comment-3298 Lloyd G. Wed, 02 Sep 2009 10:42:52 +0000 http://dailycapitalist.com/?p=1736#comment-3298 More "fake it 'til you make it" gaming by the gov't. If we can just spur a little fake demand now by laundering money through foreign banks to buy Treasuries, and bribe individuals to buy cars, houses, refrigerators, etc., things will take care of themselves. (If we have to be sneaky about it, so be it.) If things don't 'correct', we can always do some more tweaking, gaming and stimulating. It helps to have a compliant MSM. A few naysayers -- Schiff, Rodgers, Celente -- get airtime, but they're presented as oddballs. Question: Do the people at the helm really believe all this will work long term, or are these just "here goes nothing" desperation gambits? More “fake it ’til you make it” gaming by the gov’t. If we can just spur a little fake demand now by laundering money through foreign banks to buy Treasuries, and bribe individuals to buy cars, houses, refrigerators, etc., things will take care of themselves. (If we have to be sneaky about it, so be it.) If things don’t ‘correct’, we can always do some more tweaking, gaming and stimulating.

It helps to have a compliant MSM. A few naysayers — Schiff, Rodgers, Celente — get airtime, but they’re presented as oddballs.

Question: Do the people at the helm really believe all this will work long term, or are these just “here goes nothing” desperation gambits?

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