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  • Peter Schiff: Fed Will Do The Opposite Of Tapering - More Money Printing! GLD, MUX, TNR.v, GDX 0 comments
    Oct 30, 2013 5:37 PM | about stocks: TRRXF, MUX, GDX, GG, GLD, SLV, NEM, AEM, RGLD, AUY, SLW, FCX, RIO, BHP, TCK, VALE, SSRI, PAAS, NG, KGC, EGO, GDXJ, FXI, CU

    Watch the video:

     

    Peter Schiff: Fed Will Do The Opposite Of Tapering - More Money Printing! GLD, MUX, TNR.v, GDX

    Peter Schiff is very consistent in his views and even if his call for more QE sounds totally outrages do not discount it too fast. ZeroHedge reports that he is not alone in his observations. If it ever happens Gold will receive The Catalyst so many people are waiting for.

     

    Peter Schiff On Gold Catalyst: Janet Yellen Exposed Part 2 - The Truth Behind the Myth GLD, MUX, TNR.v, GDX


    Market is already reacting to Janet Yellen's appointment to the FED chair - US Dollar is solidly below crucial 80.00 level and Gold and Silver are in breakout stage this week.

    (click to enlarge)

     

    Gold COMEX Claims Per Deliverable Ounce Rises Above 55 at These Prices GLD, MUX, TNR.v, GDX


    "Jesse reports about the ongoing Game of Musical Chairs in the Western Fractional Reserve Gold System with manipulated LBMA and COMEX Gold markets. With China taking now all physical delivery from the system the entire Western Gold market is under enormous pressure.

    We found it very positive that with more unleashed attacks on Gold - in order to redeem physical Gold from GLD ETF holdings - it is more and more difficult for Gold market manipulators to keep it under $1300. Physical demand is pushing the price right back up. Goldman Sachs clients are not doing very well if they Sold their gold below $1300 following the House Gold Sell Call. This week we had a very impressive breakout in Gold, Silver and Gold & Silver mining stocks."

    (click to enlarge)

    ZeroHedge:

     

    Here We Go: SocGen Warns There Is "Possibility" Fed May Increase QE Next Week

    And so, one by one, the crazy pills theories start rolling out. Yesterday, as we first pointed out, Deutsche Bank made waves when it became the first "serious" organization to suggest that the Fed has now missed its tapering window, and will plough on thorough until the next downturn without ever lowering the pace of Flow (of course the reflexive paradox that the economy would be in an out of control depression without QE in the first placesomehow does not figure in that calculation).

    And while this has not been a novel idea (we first predicted that once perpetual QE starts it will never taper, long before QE 3, aka QEternity was even publicly announced last summer) today, all the penguin "pundit" copycats have jumped aboard this theory. Well, not all. SocGen has decided to make waves of its own with an even crazier pills idea: instead of no taper... ever... the Fed, that glorious redistributor of wealth from the middle class to the 1%, while happy to adhere to that old saying: "a funded welfare program a day, keeps the guillotines away" will not only not announce a Taper in next week's FOMC meeting but will in fact hike QE!

    From SocGen:

    Although we assign a very low probability to a decision by the FOMC toincrease asset purchases at its October meeting, it is not a possibility we can ignore. Assuming the Fed does not increase asset purchases this year, we consider the bottom of the range on the 10yT to be 2.40%. The market impact of an increase in Treasury and/or MBS purchases would be to rally the long-end of the curve back towards 2.00%, destroy volatility (again), possibly tighten the mortgage basis, and supporting equity, credit and emerging markets.

    The potential downsides to increasing asset purchases would be that (1) the market would assume the FOMC was focusing on a very grim economic picture; (2) the perceived risk of inflating asset bubbles in various market segments would rise; and (3) the FOMC may run into a credibility problem (again) by whipsawing the market.

    ...

    The question now may very well be whether or not the FOMC will choose to increase asset purchases at the next meeting, or whether it will include language in the FOMC statement that indicates they are strongly considering the option. A simple interim solution would be to reinsert the language that appeared in the May through July FOMC statements that "the Committee is prepared to increase or reduce the pace of its purchases to maintain appropriatepolicy accommodation as the outlook for the labor market or inflation changes."

    ...

    Market Impact

    The outcome for the US rates market going into year-end could vary dramatically based on what the FOMC signals next week.

    Scenario 1: The FOMC statement is relatively unchanged, recognizes recent economic weakness as potentially temporary, and suggests that a reduction in asset purchases within the next six months has not been removed from consideration. Probability: 50%.

    Lower end of range on 10yT: 2.40% through November; possible sell-off in December if data begins to improve.

    Scenario 2: The FOMC statement reinstates language that asset purchases could be increased or reduced, and raises greater concern about recent economic weakness. Probability: 40%.

    Lower end of range on 10yT: 2.30% through November; sell-off muted or unlikely unless December FOMC statement and communication begin to reinstate possibility of tapering in Q1 14 in response to improving fundamentals.

    Scenario 3: The FOMC increases asset purchases by $10-20bn in October.Probability: 10%, with full disclaimer that our economics team thinks this probability is closer to 0.0001% and that your author is nuts!

    Lower end of range on 10yT: 2.00%. The bull flattening of the Treasury curve will run us all over.

    In retrospect, this suggestion as ludicrous as it is, makes sense. After all, the Fed has lost so much credibility, it will never make up for it with a taper in October, December, March or June. In fact, the longer the Fed delays tapering (which it now will never do), the greater the confidence loss. So since there is no downside to going full retard and never tapering again, the Fed may as well go the other way: after all, it is not as if anyone on the FOMC understands what a collateral shortage is, or how dire its implications are, despite the TBAC's best efforts to educate the clueless academics in America's Politburo.

    And the other upside from the Fed announcing a $15-20 billion, or moar, increase in October or shortly thereafter, is that it will merely bring the grand reset that much closer. Which, considering the centrally-planned, crazy pills New Normal world we live in, is easily the best possible outcome.

    So do your worst: Janet.

    We, who are about to drown in your liquidity, salute you."

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