from Zeev's thread
Posted by: federal reserves
In reply to: Bearmove who wrote msg# 108015 Date:5/15/2003 6:58:34 PM
Post #of 108028
BEARMOVE> TRIM TABS is right.
As fast as AG will print money, the CEO's and wall street will print shares, then suddenly the greed swamps him, even he can't keep up. Then, the banks can float the additional supply is to sell existing inventory to raise cash to cover. As sluggish as the economy is and with all this excess capacity, the money printing does not flow into the real economy, into goods production, and wages, its flowing into stocks, bonds, real estate and commodities. The trouble is you must keep pumping more and more to build the momentum, but when you turn if off it goes poof! Its all a mirage of money.
AG has pumped like a madman this week two coupon passes of 2 billion, hes got over $30 billion in repo's out, he has pumped in over 12 billion in repo's just this week! Tommorrow the deck is stacked high, about $13 billion comes due. AG has to keep pumping or the whole shooting match will come tumbling down. He'll need to take the outstanding repo's to to new highs to push the SnP up over the head and shoulder neckline.
All we can do is watch, and see if he has the guts and firepower to keep this going. |
