BOHICA

[brimic]

In an unprecedented and controversial move the Federal Reserve today announced the initiation of an open-ended round of Quantitative Easing (QE3) and extended the period for which it will keep rates between 0 and 1/4% to mid-2015.

Translating from Fed-Speak the purchase of mortgage-backed securities is Quantitative Easing. Unlike QE1 and QE2, no dollar amount or time-limit was placed on the program. The Fed essentially announced that it will be purchasing $40 billion in MBS per month until further notice.
 
This is a monster, huge, gargantuan change from prior operations. QE1 "cost" $1.7 trillion. QE2 was half a trillion, give or take. The new plan isn't really QE3 because it's never scheduled to end. It is an entirely different, frightening animal.

http://finance.yahoo.com/blogs/breakout/bernanke-goes-means-180402117.html;_ylt=At7BdWUKBPtzsScxSFhkG6uiuYdG;_ylu=X3oDMTQzcWJsaGc4BG1pdANGaW5hbmNlIEZQIEp1bWJvdHJvbiBMaXRlBHBrZwNiOWNlNjE0Mi05MDY2LTMzYmYtOTQxOC01NTdiZjcwYzVkNzgEcG9zAzEEc2VjA2p1bWJvdHJvbgR2ZXIDMzc3YmRmNTAtZmRkMi0xMWUxLWJmNzctZDY3Y2NhNmNkMjUx;_ylg=X3oDMTFpNzk0NjhtBGludGwDdXMEbGFuZwNlbi11cwRwc3RhaWQDBHBzdGNhdANob21lBHB0A3NlY3Rpb25z;_ylv=3

[AZRedhawk44]

Bernanke speaks, and:






(These are live gifs, so they'll change as this post ages... but basically he opens his mouth and silver and gold go up 5% immediately.)

[brimic]

Yes, but he opened his mouth in a big way this time- there might be no end to this QE.
 

[brimic]

http://acrossthestreetnet.wordpress.com/2012/08/31/gold-is-a-barbeque-relish/

[zxcvbob]

The markets are up; but that doesn't mean what you think it means.  Investors are not betting on stocks, they are betting against the dollar.

[AZRedhawk44]

The markets are up; but that doesn't mean what you think it means.  Investors are not betting on stocks, they are betting against the dollar.

Ayup.  I see a lot of talk about mining stocks.

Yeah, they're stocks... but they're people that pull PM's out of the ground.

[Blakenzy]

Dump, Dump, Dump yer dollers while ya can... 

[AZRedhawk44]

Dump, Dump, Dump yer dollers quickly while ya can... 

Easing, easing, easing, easing, Bernanke's got a plan!

[Blakenzy]

It's time to do as Olivia Newton-John said:

Let's get physical, physical
I wanna get physical
Let's get into physical

Seriously, anyone holding any form of savings in dollars is going to get fleeced....FLEECED.


"I dunno where all the wealth went!"

[Monkeyleg]

I used to trade silver a lot, but I never saw a price move like that. The value of just one contract jumped $6550 from yesterday's close.

[AJ Dual]

Silver and gold are pretty out of reach for me. I'm putting it all in brass, copper, and lead.

[Waitone]

It will be real interesting to see how the Chinese react. 

[birdman]

Awesome...not
  I'd like to think, hey, I made a grand in like 5 minutes, when in fact, I didn't, just the dollar got that much weaker.  Stupid fed.

[charby]

Silver and gold are pretty out of reach for me. I'm putting it all in brass, copper, and lead.

Nice

[French G.]

Come on fixed rate mortgage, I can pay it off with cheap money later when they print themselves out of this lil mess.

[Jamisjockey]

Come on fixed rate mortgage, I can pay it off with cheap money later when they print themselves out of this lil mess.

But a burger will cost $20 and gas will be $15 a gallon.

[brimic]

But a burger will cost $20 and gas will be $15 a gallon.

...and that will only be the beginning...

[AZRedhawk44]

You know what... eff 'em.

I'm refinancing my house.

I'm happy with my 5.45% right now, but I can evidently get as low as 3.375%.  A couple of friends of mine just did.  And if I want to go to a 20 or 15 year instead of a 30, I can get into the high 2's.

They're paying ME to stay in my house at that rate.  That's less than inflation by anybody's numbers.

I'll take all those savings (cutting my interest nearly in half will save me about $300 or so a month) and buy PM's with it and laugh all the way to the crash.

[zxcvbob]

I'm happy with my 5.45% right now, but I can evidently get as low as 3.375%.  A couple of friends of mine just did.  And if I want to go to a 20 or 15 year instead of a 30, I can get into the high 2's.

They're paying ME to stay in my house at that rate.  That's less than inflation by anybody's numbers.

You know the next step is to adjust the principal on home loans and student loans?  Basically, index them against the value of hyperinflated dollars.  We have to protect the banks (and screw you)

I can't tell if the Fed and Obama are in cahoots here, or if the Bernanke is doing this on his own and Obama is just a useful idiot.  But somebody is trying to destroy all the private wealth in this country, except maybe for the top small fraction who are both very rich and politically connected.

[AZRedhawk44]

You know the next step is to adjust the principal on home loans and student loans?  Basically, index them against the value of hyperinflated dollars.  We have to protect the banks (and screw you)

I've got a binding contract that says I owe $XXX,YYY dollars over ZZZ months of payment.

They "reindex" I'm gonna let them take the house instead.  I don't have that much equity that it'll be worth it, versus the freedom of not having obligations while also having a small mountain of precious metals.  I'll take my PM's and flat-out buy some land somewhere else.  Or not.  Maybe I'll buy a boat and escape to the Caribbean with a hot sport biker chick instead.   

[brimic]

I'm happy with my 5.45% right now, but I can evidently get as low as 3.375%.  A couple of friends of mine just did.  And if I want to go to a 20 or 15 year instead of a 30, I can get into the high 2's.

Run the math, you might be surprised at what you can save.
We just recently refi'd down about a percentage point which saves about $26,000 in interest.
It also means that we will have it paid off in 10 years instead of another 12.
Our monthly payments only went up by $20.
you could buy a lot of cool toys gold with that kind of money.

[brimic]

You know the next step is to adjust the principal on home loans and student loans?  Basically, index them against the value of hyperinflated dollars.  We have to protect the banks (and screw you)

Can they do that?

I can see a lot of 'killdozer' episodes happening very frequently around the country if this came to pass.

[AZRedhawk44]

Can they do that?

I can see a lot of 'killdozer' episodes happening very frequently around the country if this came to pass.

Can they cancel bond obligations of a bankrupt corporation, and then hand assets over to Unions instead, in flagrant violation of all bankruptcy law and precedent prior?

Can they ban private ownership of precious metals?

Can they ban alcohol production and consumption and trade?


Sure.  If you let them, and you play by their rules.

[brimic]

I can't tell if the Fed and Obama are in cahoots here, or if the Bernanke is doing this on his own and Obama is just a useful idiot.  But somebody is trying to destroy all the private wealth in this country, except maybe for the top small fraction who are both very rich and politically connected.

There is absolutely no doubt about this.
My hope is that enough middle class people wake up to this reality and prepare for it so they aren't taken off guard by it.

[brimic]

Can they cancel bond obligations of a bankrupt corporation, and then hand assets over to Unions instead, in flagrant violation of all bankruptcy law and precedent prior?

Can they ban private ownership of precious metals?

Can they ban alcohol production and consumption and trade?

Good points, all of them.

Sure.  If you let them, and you play by their rules.

I don't think we will have the choice- "he who holds the gold makes the rules" and all that...
OTOH, the powerful and connected aren't going to have much of an existance if a lot of formerly middle class serfs are headhunting.