And This Is Surprising?

Tue, Jul 12, 2011 - 6:44pm

From the Fed minutes released today:

"Some participants noted that if economic growth remained too slow to make satisfactory progress toward reducing the unemployment rate and if inflation returned to relatively low levels after the effects of recent transitory shocks dissipated, it would be appropriate to provide additional monetary policy accommodation....A few members noted that, depending on how economic conditions evolve, the Committee might have to consider providing additional monetary policy stimulus, especially if economic growth remained too slow to meaningfully reduce the unemployment rate in the medium run."

From TF Metals Report:

FRIDAY, MAY 20, 2011

Points For Friday
A couple of things before we get to the charts.

Just to address this "ending of QE" issue again. By some estimates, the U.S. Federal Reserve and their primary dealers (the PDs are the agents from which they buy back recently issued bonds via POMO) make up as much as 70% of the bidders in the overall treasury market. If they were to now exit this market, even in part, interest rates will rise dramatically as prices of bonds will fall due to lack of demand. The latest $600B QE/POMO schedule lasted 6 months. What was the U.S. federal deficit over those same six months? A little more than $600B. Even Stevie freaking Wonder can see the direct connection.
If the Fed halts QE:
1) Rates skyrocket
2) U.S. economic activity grinds to a halt
3) Tax revenues plummet
4) Even more deficit spending is then required
5) Rates go even higher
6) Interest on national debt component becomes an even larger % of federal budget
7) Even more deficit spending is required
8) Rates go higher still
9) Tax revenues fall further
10) The Great Keynesian Ponzi finally ends
DO NOT believe this silly notion that QE is about economic growth. QE is about funding the deficits of the U.S. government. Every other effect is ancillary. The only thing that would allow the Fed to end QE would be a dramatic reduction in the annual federal deficit. This would lead to a deficit spending level that the "market" in treasuries could absorb. Until then, the presses will run. Period.

Again, the intraday high of the August11 contract was 1577.70 on 5/2/11. A close above there would be extraordinarily bullish. This afternoon's high was 1574.30. Tomorrow will be quite interesting. TF

About the Author

turd [at] tfmetalsreport [dot] com ()


sevin · Jul 13, 2011 - 11:23am

I wonder who all is left in

I wonder who all is left in the running for Turd's Big Yellow Hat in the guess for when Silver will hit $40?

Xeno · Jul 13, 2011 - 11:24am
JamboMamboBill · Jul 13, 2011 - 11:28am

"...Medicare will run out of

"...Medicare will run out of money no matter how much taxes we get more..." The system is cooked folks !

Oil just about to cross 100... and here we go again

666 · Jul 13, 2011 - 11:30am

The Bernakey show

Is the funniest thing I have seen on TV for a longtime ;-) It's unreal

ned braden · Jul 13, 2011 - 11:32am


Video unavailable
Pablo · Jul 13, 2011 - 11:35am

Sound money - who needs it!

I created this for my bestest buddy Bennochio - Go get 'em, Ben!

666 · Jul 13, 2011 - 11:36am

Watching gold and silver

Is the second funniest thing I have seen for a long time They smokin

Tesla · Jul 13, 2011 - 11:38am

Time for the Banker Song!

Gene Burnett - Jump You F*#kers (A Song For Wall Street)
Dr G · Jul 13, 2011 - 11:40am

For future reference, news

For future reference, news streams online for all major networks (CNN, Fox, CNBC) available at

That's what I often use during the day to watch CNBS while at work. Very nice.

illyasviel · Jul 13, 2011 - 11:41am


Are there any short term levels we should be watching in silver where there might be significant resistance or so? Im starting to look green again (just ~2% away :)) so i would rather not loose it all in a raid.

Volume in silver seems really low at the moment, what do you all think?

ewc58 · Jul 13, 2011 - 11:41am

Way to go Ned Braden

HT from me on that clip. And what a clip it is... Game. Set. Match.

Thank you, Dear God, for making me a PM owner. I only pray I started early enough to get my family through what now lies ahead. Amen.

JamboMamboBill Pablo · Jul 13, 2011 - 11:42am

Sound money - who needs it!

I like that my tradition too!

I didn't know you comment here bro?

666 · Jul 13, 2011 - 11:43am

5.1 Trillion

"if we'd used the 5.1 Trillion $ for not supporting business and given it to the nation, we'd have given away $ 17,000 each person'" I haven't checked the maths....... My calculator isn't big enough !!!

Juan Moment · Jul 13, 2011 - 11:47am

Could be by the end of the week...

I wonder who all is left in the running for Turd's Big Yellow Hat in the guess for when Silver will hit $40?

My guess was July 25.... After today's raunchy performance I have a feeling though it'll get there before then.

Shill · Jul 13, 2011 - 11:48am

Ya know

Just hearing Ben say " Gold is not money " means for me anyway the End game is closer than we all realize.

ned braden ewc58 · Jul 13, 2011 - 11:48am

Just tryin' to capture the "spirit of the thing"

At very end Congressman Paul twists the knife a little...."You know some people still think of it as money.."

bullwhip29 · Jul 13, 2011 - 11:55am

Not time to celebrate yet.

The EE could attempt to carpet bomb us at any time. Not sure yet if they are out of ammo or this is another setup like end of April/early May.


question · Jul 13, 2011 - 12:10pm

Not time to celebrate yet

I agree; we're a long way from the end of this show. I expect much volatility before this is done and I think it's only beginning. Sure is fun though seeing new highs during the "summer doldrums". The times they (have) are a changin.


JamboMamboBill · Jul 13, 2011 - 12:24pm

I know why we didn't have a

I know why we didn't have a bot attack yet...

Because Berny's is too busy at the meeting...

Expect a sudden drop when he goes back to his office at the FEDs tavern!

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