From Bill Holter at Le Metropole Cafe . . .
To all; the premier of China has said "We have made a huge amount of loans to the United States. Of course we are concerned about the safety of our assets. To be honest, I'm a little bit worried," Wen said at a news conference following the closing of China's annual legislative session. "I would like to call on the United States to honor its words, stay a credible nation and ensure the safety of Chinese assets."
This is it, this is the beginning of "banana republic" time. If the Chinese truly step back and do not support our Treasury auctions, the buyer of last resort will be the Fed. I am sure the Fed has already begun monetizing but without Chinese support, the Fed will be monetizing out in the open for all the world to see. All of the massive bailouts that have been promised will in essence be paid for by the Fed printing more Dollars to give to the Treasury. The Chinese "communicate" in this fashion, they have made a very strong statement to Washington. It is no longer a question of if, only a question of how rapidly the Dollar unwinds. We all knew this day was coming, the day that the markets see an auction without Chinese participation will be horrid. Strap in and hunker down.
Regards, Bill H.
http://www.breitbart.com/article.php...show_article=1
More from Bill on "Quantitative Easing"
To all; beyond stupid is all I can say about the Fed's announcement today! They are going to spend (read print) $1 trillion, to inject into the economy and buy Treasury bonds, can you say HYPERINFLATION! As a side note, CNBC reported "massive" call buying in long term Treasuries early today, can you say INSIDER TRADING! So I guess we are now all saved, again, for the umteenth time.
Treasury yields have immediately cratered about 1/2% in the 10 and 30 year Treasuries, this knee jerk reaction will soon be seen as nothing but a reaction by a bunch of jerks. So the Fed will expand it's balance sheet by another 50% and investors want to buy fixed income securities? They are buying bonds with lower yields when the Fed says they will create more Dollars to buy Treasury bonds that promise to pay in these same over issued Dollars? I don't get it. Well actually I do, and I think anyone buying bonds now will get it shortly, you know where. Mr. (I'm a student of the depression) Bernanke has thrown in the towel and is hyperinflating in plain sight, this will not work and will not stand when the G-20 meets in 2 weeks.
This is panic by the Fed, plain and simple. It is also the admission of failure, failure of all the past plans to unthaw the credit crunch. If you watched Gold today, you saw it down $30 plus Dollars until the Fed announcement, it is now up $30+. If you had any questions as to whether Gold was manipulated or not, today's action should do it for you. Gold had no reason to be down hard except for the fact that it was necessary to "retard" it so a $60 rally would look like a $30 rally, HOW PATHETIC!!! If you had any lingering questions about owning Gold, they should be completely gone as the Fed "rang the bell" today, WE WILL DESTROY THE CURRENCY TO SAVE THE BANKING SYSTEM! No ifs, ands, or buts, this is textbook hyperinflation.
The Dollar has had a huge one day collapse -3% (read, everything just got 3% more expensive in Dollar terms), stocks are giving up their gains, and Gold and the shares are running upward like scalded dogs, these are all to be expected. Treasuries however are very counterintuitive and anyone who owns them and doesn't sell into this rally (unless hedged by Gold) needs to have their heads examined. Yields should begin a huge rise very shortly as the world figures out what just happened today. I cannot stress enough how big today is, the implications are earth shattering. This is the Central Bank of the world's reserve currency admitting failure and panicking two weeks before they meet with their banking "brethren". Talk about bargaining from a weak position, Geithner, Bernanke and co. will be sent to the corner and ordered to wear a "dunce cap" (made of paper mache) when they arrive in London. They will show up to the gunfight with paper knives.
I knew this had to happen, I like everyone else hoped I was wrong. Now we will watch as the smoke pours from the Fed's money printing factory as the presses burn up and burn out. It is almost hilarious listening to CNBC's endless line up of idiots raving about how great this "quantitative easing" is, they don't even have a clue as to what is happening. Wecome to Zimbabwe, a loaf of bread costs $10 billion. I will leave you with this question to ponder, "what is the difference between U.S. Dollars and those of Zimbabwe"? The answer is in the title.
Regards, Bill H.