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Strategies & Market Trends : Buy and Sell Signals, and Other Market Perspectives -- Ignore unavailable to you. Want to Upgrade?

To: FCom777 who wrote (57215)	2/10/2014 6:45:55 PM
From: realskeptic7	3 Recommendations Recommended By D.Austin Fiscally Conservative GROUND ZERO™ Read Replies (1) \| Respond to of 222883

It is also possible that it will end in some dramatic way that we don't see coming. Things that can't go on forever--don't. The Fed's focus should never have expanded beyond trying to hold inflation to perceived optimal level. Once they started trying to prop up markets, prop up employment, or whatever, they have laid the seeds of their own demise. They are almost completely trapped now. If meaningful tapering occurs (easing of QE'ing), and then rates rise, our whole DC, one-party-state, client-services system breaks down. Servicing the debt and servicing the clients requires more money than the gov't has or will be able to raise. It's possible that the growth of the monetary base you showed will lead to enough (just enough!) inflation to inflate away the Fed's balance sheet, overseas bond holders, and gov't obligations (and that is what they are betting on), but I can see other possibilities. And history is littered with such failures. Unfortunately, I don't see a way off of the speeding train. Destined to live through it, perhaps.

To: FCom777 who wrote (57215)	2/11/2014 2:00:51 AM
From: Nevada9999	2 Recommendations Recommended By Brian Sullivan Fiscally Conservative Respond to of 222883

I hear what you're saying, but I don't believe that degree of monetary expansion is sustainable. I'm not sure the stock market or the economy is sustainable without the printing. The stock market is high enough that maybe the Fed is willing to concede a 20-30% correction in the Dow hoping that money rotates into bonds as they taper. Maybe the money moves into something other than bonds and they lose control. Maybe the economy is ready for the taper. I don't know. Someone is bound to get hurt in this high wire act sooner or later. Confidence seems excessive. Remember when the Fed was supposed to fight inflation? Now they are supposed to create it, but only 2%. They spent so, much trying to get that 2%, that I'm not sure they don't need 4% now. Somehow they need to expand the economy (and tax base) faster than the national debt. It's just not happening, even though many things are not even included in the national debt. To expand the economy they are probably going to need to shrink the measuring stick (the dollar) if they can't get true economic expansion. That creates stagflation. Yes, there are strong deflationary undercurrents. Does that save us or is it dangerous? I see a lot of headwinds and big problems out there. QE infinity is a solution, but its also a problem. If central banks could do that with impunity, they all would. I think I count more problems than solutions, but who knows what happens or when. I'm not positioned for a stock market decline. I tried that in 1999 which was easy by comparison and barely broke even. If the dollar craters the stock market could go to the moon like Zimbabwe. I do like gold stocks since they are hated, they are 75% cheaper than they were three years ago, physical gold demand is up, mine supply is flat, exploration and development are failing. That setup looks at least as good to me as 2000.