FOMC Statement: English Translation 20 comments
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Tickerguy's English translation of the FOMC statement:
Release Date: November 4, 2009
For immediate release
Information received since the Federal Open Market Committee met in September suggests that economic activity has continued to pick up.
We successfully talked some people into rebuilding inventory and spending money they don't have. Suckers.
Conditions in financial markets were roughly unchanged, on balance, over the intermeeting period.
We don't count the 29.9% interest rates that Citibank decided to charge its credit-card holders in this computation; but if we did that would be considered a good thing, since raping the consumer is positive for banks. Oh, and we're a bank.
Activity in the housing sector has increased over recent months.
Four year olds and cats are cashing the $8,000 homebuyer credit, as the IRS has recently disclosed. This of course supports housing.
Household spending appears to be expanding but remains constrained by ongoing job losses, sluggish income growth, lower housing wealth, and tight credit.
A huge number of people are out of work, those who have jobs are having their wages and hours cut, your house is still going down in price and Citibank just raised your credit card interest rate to 29.9%. This is all bullish for the economy, of course.
Businesses are still cutting back on fixed investment and staffing, though at a slower pace; they continue to make progress in bringing inventory stocks into better alignment with sales.
We suckered a few of you, but most businesspeople have IQs larger than their shoe size, and refuse to play our game any more. As a consequence our attempt to hose them isn't working out so well.
Although economic activity is likely to remain weak for a time, the Committee anticipates that policy actions to stabilize financial markets and institutions, fiscal and monetary stimulus, and market forces will support a strengthening of economic growth and a gradual return to higher levels of resource utilization in a context of price stability.
Fraud always works for a while. We can buy trash MBS, for example, and by doing so make things look better than they are. We can also ignore the real capital position of the banks that are under our jurisdiction, including those really big ones that shorted Gold in the futures market at $1,000 and now are way underwater. Never mind that little man behind the curtain, I AM THE GREAT AND WONDERFUL OZ!
With substantial resource slack likely to continue to dampen cost pressures and with longer-term inflation expectations stable, the Committee expects that inflation will remain subdued for some time.
The only place pricing power exists is in commodities. Everywhere else prices are collapsing. That's not supposed to happen, but we'll figure that one out later.
In these circumstances, the Federal Reserve will continue to employ a wide range of tools to promote economic recovery and to preserve price stability. The Committee will maintain the target range for the federal funds rate at 0 to 1/4 percent and continues to anticipate that economic conditions, including low rates of resource utilization, subdued inflation trends, and stable inflation expectations, are likely to warrant exceptionally low levels of the federal funds rate for an extended period.
When something doesn't work, do more of it! That's the ticket! Pay no attention to that asshole Einstein - he's dead, and besides, I'm smarter than he ever was.
To provide support to mortgage lending and housing markets and to improve overall conditions in private credit markets, the Federal Reserve will purchase a total of $1.25 trillion of agency mortgage-backed securities and about $175 billion of agency debt. The amount of agency debt purchases, while somewhat less than the previously announced maximum of $200 billion, is consistent with the recent path of purchases and reflects the limited availability of agency debt.
We bought it all. We're no longer part of the market, we are the market! We have no freaking clue how to exit from this, and we know that when we do rates will spike higher. Unfortunately we also know that if Fannie and Freddie continue to bleed red ink we will blow up instead of them by doing this, so in March we pinky-promise to stop, even though that will destroy what's left of the housing market.
In order to promote a smooth transition in markets, the Committee will gradually slow the pace of its purchases of both agency debt and agency mortgage-backed securities and anticipates that these transactions will be executed by the end of the first quarter of 2010.
There isn't any more to buy, didn't you hear us up above? Fools.
The Committee will continue to evaluate the timing and overall amounts of its purchases of securities in light of the evolving economic outlook and conditions in financial markets. The Federal Reserve is monitoring the size and composition of its balance sheet and will make adjustments to its credit and liquidity programs as warranted.
It's all trash but heh, it's marked to model! I pinky swear it's all worth PAR. Seriously.
Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; William C. Dudley, Vice Chairman; Elizabeth A. Duke; Charles L. Evans; Donald L. Kohn; Jeffrey M. Lacker; Dennis P. Lockhart; Daniel K. Tarullo; Kevin M. Warsh; and Janet L. Yellen.
We're all in this together, now let's hold hands and......
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This article has 20 comments:
2. All WashDc-Wall ST bloat, vapor and bubble is a leading indicator. Fake dollars are wealth and fake dollars are everywhere and every day in wondrous proliferation. Wall St bonuses are the only, true, reliable and relevant metric of a booming economy
3. The only source of wealth creation is the spread between free, limitless credit available to Big Money and the high interest, onerous condition, withdraw at will, credit provided to small businesses and ordinary households
4. There are no bad loans, only bad, obsolete, ways of thinking about assets and liabilities.
I'm SERIOUSLY envious: educational AND entertaining!
Better know as Ali Baba and the Forty Thieves or the inverse of Robin Hood and friends
In these circumstances, the Federal Reserve will continue to employ a wide range of tools to promote economic recovery and to preserve price stability. The Committee will maintain the target range for the federal funds rate at 0 to 1/4 percent and continues to anticipate that economic conditions, including low rates of resource utilization, subdued inflation trends, and stable inflation expectations, are likely to warrant
Should read
In these circumstance of pathetic growth following trillions of wasted intervention, the Federal Reserve admits that he has already employed all available tools to promote the economy and with the federal fund rate at 0 to ¼ has run out of ammunition to fight the recession. We now hope that things will sort themselves out as we can do nothing without promoting inflation, and pray now with all the liquidity being created the inflation does not creep it’s head out and the $ maintains a viable value for a reasonable time for things to sort on their own and avoid depression.
Should read:
We are doing everything in our power to debase the dollar, re-inflate the housing bubble, erode the status of our nation and give our buddies on Wall St carte blanche to gang rape the taxpayers (at taxpayers’ expense, of course).
He must look out his shades every night and look for the dark lightless cars that slowly drive by his home. I know I would. This "game" is going to unravel. No question about it. There is no time frame however, so many average Americans who have decided that thinking for themselves is a thing of the past, are going to be stunned at some point.
The lies and manipulations keep building. I have no doubt in my mind it will all end badly and the real recession / depression we should have had for the past 16 months will have to be faced in its entirety in the coming future.
Remember: Ignore the liars who work for the powers that be, ignore CNBC for they are nothing more than paid liars, also ignore the asset gatherers both professional and wanna be (We see many of them here on SA).
These people all do one thing very well:
They keep telling people what they want to hear instead of telling the people what they need to hear.
....Though it will bring a whole new meaning to the term living in a "dog house"
The FED has no idea how to get out of this.
They are doing what is politically easy and makes their friends money.
29% Interest on Citi credit cards? Just wait and see how many Americans follow the moral hazard trail paved by the bailouts. 29% of zero is less than zero; however, watch Citi pass the defaults on to the taxpayer just like everything else.
This is the single biggest issue. Forget the housing market or stock market. Commodities hoarding shows 3 things. A lack of faith in our currency (go figure with with zirp, mass deficits, and QE) and no desire or belief in a real growth in the US economy except that which is reflected in dollar depreciation. And possibly increased real demand by foreigners for commodities we need.
If you want to bet equities please make sure to bet on companies that sell or are overseas businesses. They are the prime beneficiaries of dollar weakness. Don't believe the domestic economy hype.
Rising commodities not only cause inevitable inflation but will crimp an already stretched government deficit and put a stop to any economic recovery. The Federal Reserve should be sensitive to these facts not how to artificially boost GDP.
Their minds are so locked into the narrow Keynesian macro model they have been schooled in and the data that feed it that they don't see much reality beyond that and don't feel a need to. The test of their disconnect from macro reality is that worldwide price bubble and their ignorance of it or lack of concern about it. A very tunnel-visioned bunch. Even the IMF and WB get it, but they don't.
One irony is Larry Summers and others in Washington clearly give Nouriel Roubini his due as a prescient forecaster, but no one in the Fed or the Administration now wants to hear Roubini's forecast of big trouble ahead worldwide from the price bubble, even if such a bubble crashing could derail the struggling recovery and Washington's efforts to put the economy on its feet.
A new motto for the Fed: "Hear no evil, see no evil, but do lots of unintended evil when possible."