Bernanke, Taper Talk, Rates Up, Stocks and MBS Selloff, We Are Addicted


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4 thoughtful posts.  ALL markets were hurt last week. The markets will spank Ben back into line, I predict.


EPIC RANT: “They Take a Press Release from the Federal Reserve and They Think It Was Written by God” – Mac Slavo –  If there’s one thing that individual investors can take away from Ben Bernanke’s latest Fed update, it’s that all confidence in the financial and economic systems of this country has been lost. Within seconds … stock markets tumbled. … The only thing keeping the entire system afloat is the fact that the U.S dollar is the world’s reserve currency, and that we can print it to infinitum. – SHTF Plan 
(lots here) The Taper is Too Sharp – Yves Smith – … I’ll readily admit that I’ve been behind the curve in the past twelve months on the US housing market recovery. But these kind of dramatic interest rate hikes are going to kill refinancing activity and retard new mortgages as well. That will slow the housing market. Stock market sell-offs come and go but housing slowdowns have deep impacts. Perhaps if the global economy were stronger it would be smooth. But with a European recession, a deteriorating China and rising US dollar, I’m still not convinced that the Fed will even get to its taper. … – Naked Capitalism 


Bernanke Kills Fed Credibility and the Confidence Fairy in One Shot – Yves Smith – … The big problems are the Fed has no idea how to exit and this problem results from the flawed design of QE, of targeting quantities rather than rates. So the one thing Bernanke sort of made clear yesterday is the Fed will make up its mind as the data comes in. That’s not exactly the sort of guidance Mr. Market was looking for. … – Naked Capitalism 
(must  read also mentions MBS and housing) Peter Schiff And The Untapering “Waiting for Godot” Era – Submitted by Tyler Durden  – The mere mention that tapering was even possible,. … was enough to convince the market that the post-QE world was at hand. This conclusion is wrong. … Most fail to grasp the degree to which the “recovery” will stall without the $85 billion per month that the Fed is currently pumping into the economy.  Of course, when the Fed is forced to make this concession, it should be obvious to a critical mass that the recovery is a sham. … – Zero Hedge


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