Thank You Letter to Uncle Ben.

Dear Uncle  Ben

   Thank you very much for the lovely present that you gave me for my birthday. It was so delightful and will come in very useful. I can just imagine you asking the shopkeeper for the least garish or outrageous statement they had as your intentions to please are nothing but honourable.  For this I would like to say a very, very big thank you.  

When I unwrapped your gift in front of the family I was delighted with your choice of calming words associated with steady growth, but unfortunately at the mention of "tapering" my bonds instantly spewed their guts up all over the floor. Still, these things happen and it could have just been a bad portfolio adjustment they had the night before. It was only when your mentioning of  target unemployment rates coincided with our emerging market portfolio re-enacting that scene from Alien where the hero's chest explodes, that we wondered if something might be more generally amiss.  However we put this notion aside as our European equities looked just fine. 

Until this morning, that is, as when they woke they had blood pissing from every orifice. At first we thought that they had caught Ebola and so took them to the Hospital for Tropical Medicine where the doctors were baffled. But when we mentioned the symptoms suffered by our USTs, emerging market portfolios and, as we had since discovered, the hang drawing and quartering of our Aussie dollar, they became concerned and called us aside. 

Now this might appear a little speculative, but they suggested that there is a small chance that the cause of all the calamities our family has suffered over the last 24 hours may in fact be associated with your very generous present. Far be it for me to cast aspersions, but I thought it only wise and fair, despite my own faith in your kindness, to pass these concerns on to you should you be thinking of presenting any similar statements in the near future. 

Best wishes and thank you again

Your very needy nephew 

Mickey Long. 

PS . My dad says  "If that ()&^""£ ever tries a dumb %RS^ trick like that again he can take himself and his mortgaged country and stick it up his QE *&%£" no matter how cheap his shale gas is. Does he know how long it took me to build that Indonesian corp bond position?"  I'm not sure what a lot of the long words mean but he and his portfolio went very red and he has passed out on the sofa unrousable, even by the wild cheering coming from Mr Shorty next door.

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admin
June 20, 2013 at 1:50 PM ×

I didn't know it was your birthday. Happy birthday. ;=)

(perhaps you weren't meant to be swimming in your birthday suit?)

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"Cassandra"
admin
June 20, 2013 at 4:00 PM ×

I'd like to see the letter that Jeffrey Osborne received...

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Corey
admin
June 20, 2013 at 5:40 PM ×

Who would have thought that the man known as helicopter Ben was flying a blackhawk. But I supose thats what we get for trying to anticipate what any politician will do/say..and that is what he is afterall, even if he does have an economics degree. He did say something at the Princeton commencement that goes a ways towards explaining the move, it was something along the lines of "most politicians do what they think is right most of the time and if you think there is anything diabolical in their actions you're giving them too much credit." So I put the fault not with the man but with the theory. When will they stop holding onto the ridiculous idea that it is the stock not the flow?

Perhaps ben has yet to realize that it is been properly labled QEfinity for that very reason that it is infinite. Tightening has gone from a 25bp move in ffds to simply stating that you may tighen in the future if economic conditions warrent.

Since the mkt has frontrun every fed move in this new era i anticipate the actual reduction in purchases will probably mark a good entry point as it will soon be followed of talk of reversing the prior due to economic weakness.

However I will be watching that yellow indicator of confidence as it has proven invaluable in that regard even if it has no intrinsic worth. If it werent for those shorts the hemorrhaging would surely require amputation and for that I thank you. Apologies for the length.

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abee crombie
admin
June 20, 2013 at 6:37 PM ×

um hello melt down.

Gold, Copper, Oil, FX, MBS, you name it, aside from 'Quality' US companies.

Hit the current account deficit countries, aside from the US...

Brazil, Thailand, Turkey and India..

How this doesnt translate into reduced S&P earnings is beyond me but thats the game now.

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rp
admin
June 20, 2013 at 7:13 PM ×

This business of an explicit unemployment target to temper policy is ridiculous. Either a reversal, once the job measures diverge, or they do a reverse-greenspan-bubble enhancement job. Money's on the latter what with GFC likely to be on public's conscience well into 2020.

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Anonymous
admin
June 20, 2013 at 8:25 PM ×

The most interesting thing today was seeing the Yen reverse as the selloff intensified. I must not understand safe haven eligibility very well.

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Anonymous
admin
June 20, 2013 at 10:03 PM ×

Anon 8.25 think that JPY reversal may be linked to the (underreported) china/shibor side of the puke (when indeed tapering and UST belly holocaust should have USDJPY higher). Just our 2c (literally, as we have picked up a couple of worthless Julys, you know, just in case).

Question for FX players. CHF? Major USD/x laggard, right? If we are pricing tightening the way we seem to be these past two days, isnt there loads of trapped money there that will have to make its way back to Amurrica?

Thanks
DD (who is starting to understand how Hussman feels with the drip drip drip)

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Anonymous
admin
June 20, 2013 at 10:56 PM ×

P.S

Perhaps one small suggestion for the Chairman. if in the future instead of the car analogy a better representation may be made by using the pissing analogy: whereas if you have a strong stream and are splashing so much into the outhouse of global liquidity that others standing around the pool are splashed by the golden showers, when a reduction in the strength of your stream, or in this case future expectations for the strength of your stream occur, global risk assets which have hitherto been drenched in liquidity will rapidly reprice towards intrinsic value in accordance to the magnitude of the former's prior deviation, which is caused by the overflow of the latter. If you want to give it to us straight you may start by admitting that. This will go much further towards enhancing your credibility than giving us moving targets which no economist can
accurately predict.

PPS You're supposed to let the bubble blow before you pop it.

ppps you dont change the rules in the middle of the game

p..ps how is the discussion of your personal life when that person is the fed chairmen not relevant. I suppose you were trying to take that out of the equation but you ended up adding uncertainty just tell us yes you're done and Janet will take over so we know

ugh, rant over.

Love
Cor

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Anonymous
admin
June 20, 2013 at 11:50 PM ×

The fed should follow the corporate model and preannounce bad news to allow the mkt to adj before it becomes extended.

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