Forex Forum Archive for 05/10/2014

Mtl JP 22:46 GMT May 10, 2014
Yellen Testimony

(No) Conundrum 2.0
May 9, 2014 posted by Doug Noland - prudentbear.com

Could things possibly be any more fascinating?

Representative Kevin Brady: �I�ll conclude with this. My main concern, having served on the committee in the early to mid-2000s, your able and very highly respected predecessor sat where you sat and assured the committee that maintaining low interest rates for an extended period wouldn�t cause general price inflation or inflate an unsustainable asset bubble - which didn�t prove to be the case. After the credit-fueled housing bubble burst in 2007, your predecessor assured the committee that the resulting weakness would be confined to the subprime segment of the housing market and the damage would be limited to about $150 billion, roughly the cost of the S&L crisis. Following the financial crisis in the fall of 2008, we were repeatedly assured the Fed had the strategy to exit from the large expansion of its balance sheet to normalize monetary policy, including the federal funds target. Yet, the goalposts have been moved time and time again - and now removed. And today, you�ve assured the committee once again - and I so appreciate your testimony - that the Fed is confident it can exit without sparking high inflation; but that we can�t know the details or the time-table; but that the Fed and the FOMC have it essentially handled. I don�t expect the Fed to be perfect. Yours is a tough job. Theirs is a tough job. But it just strikes me this over time �don't worry be happy� monetary message isn�t working - at least, in my view, for the committee and certainly not for the economy at this point. I know my colleagues will ask about today�s Wall Street Journal where noted economist, Federal Reserve historian Dr. Alan Meltzer, makes the point never in history has a country financed big budget deficits with large amounts of central bank money and avoided inflation. My worry is that the track record of central banks, including the Fed, in identifying these economic turning points and acting quickly to prevent inflation, that track record is not as good as we would like. So, forgive me for being skeptical. I believe we need more specifics and a clear timetable on the comprehensive exit strategy.�

Good luck with that, Congressman. There will be neither specifics nor a timetable. The Fed has pretty much painted itself into a corner. QE3, in particular, fueled dangerous Bubbles in equities and corporate Credit. Meanwhile, it ensured another two years of global (largely Asian) over- and mal-investment. Today and going forward, the Fed will have little clarity as to the soundness of the financial markets or real economy. It will have minimal grasp on prospective inflation rates. So long as the financial Bubble inflates, economic output will appear OK. Yet market Bubbles guarantee intractable financial and economic fragility. Market tumult would, in short order, darken economic prospects. Very few appreciate today�s dilemma. .../..

Mtl JP 22:37 GMT May 10, 2014
Global Markets News

Bloomberg - China Central Banker Calls for Tougher Rules on Shadow Financing

Reuters - China to avoid big economic stimulus: central bank chief

HK RF@ 11:30 GMT May 10, 2014
Crafty Putin and his art of virtual retreat.



Mtl JP 10:36

So we shall be back to the middle ages barter trade, without banks and computers. Just prepare some silver coins to barter trade your needs:)

Mtl JP 10:36 GMT May 10, 2014
Crafty Putin and his art of virtual retreat.

HK RF@ 01:21 // too much focus of "hard" stuff.

Do not be surprised if you start to see some infrastructure interruption blackouts in the "west" at some point.

Say something like alleged stock exchange "coding bugs"

HK RF@ 04:47 GMT May 10, 2014
Adding fuel to the fire. Serious provocation.
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Kherson governor calls Hitler 'liberator' addressing veterans on Victory Day.
​Addressing the public on a Victory Day, the governor of Ukraine�s southern Kherson region trampled on the feelings of many veterans and desecrated the memory of all those who perished during the war against Nazi Germany by calling Hitler a �liberator.�

Governor of Kherson region Yuri Odarchenko was booed by thousands including WWII veterans when he told the previously cheering crowd that the Soviet Union tried to enslave Ukraine, while Hitler on the other hand tried to bring freedom to their land.

�Those [Soviet] aggressors justified their capture not only by their desire to seize others' territory and enslave the people, but they also put forward slogans about liberating nations and people that inhabit the lands which Hitler hoped to capture,� Odarchenko told the crowd.
Historians, citing data available from Second Secretary of the Regional Committee of the Communist Party of Ukraine, shows that Nazi forces in Kherson region killed 72,130 citizens and shipped about 40,000 to Germany to work in labour camps, while Germans ruled a crucial port on the Black Sea and Dnieper River from August 21, 1941 to March 13, 1944. Other historians place the figures at 105,000 Soviet citizens killed and more than 60,000 sent to Germany as slave labor.
In the autumn of 1941, about 10,000 Jews were killed in the city of Kherson alone. It is estimated that at least 47,000 Red Army soldiers died while force-crossing the Dnieper as they tried to liberate the city from the Nazis.

The Kherson governor offended the veterans on their most important holiday, Russia's deputy Prime Minister, Dmitry Rogozin, said in his twitter post, calling him a �bastard.�

LINK

HK RF@ 01:21 GMT May 10, 2014
Crafty Putin and his art of virtual retreat.
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But there is the moment, he has to face the music, means that after the local elections(probably also a rigged one) declared by the insurgents, he will have to recognize the results or reject them.

And if the people will decide to push for annexation, that will be Putin's moment of truth.

Well at least the annexation, will be less bloody than by using the Russian army.
The visit to Crimea was a clear GO signal for the local elections, and clear provocation toward the west.