[shortonoil]

"The chart below shows the Fed's balance sheet expressed as a % of GDP: it has grown from its long-term "normal" 5% to just over 25%."

We put this graph up almost two years:

http://www.thehillsgroup.org/depletion2_022.htm

We knew that the price of oil was going to decline, but what caught us by surprise was the rate at which it fell, and fell, and fell. It was Chris Martenson that put forth the notion that what was driving the price down as rapidly as it was, was Central Bank monetary policy. A quick calculation by us showed that ZIRP policy alone was reducing Bakken production cost by $25/ barrel. It was the FED that financed the over production that smashed the oil market. If they restart QE it is going to be a blood bath for petroleum. Let's hope Chris is wrong this time, and they don't. Unfortunately, he doesn't seem to be wrong very often.

[Outcast_Searcher]

$this->bbcode_second_pass_quote('shortonoil', '[')i]"The chart below shows the Fed's balance sheet expressed as a % of GDP: it has grown from its long-term "normal" 5% to just over 25%."

We put this graph up almost two years:

http://www.thehillsgroup.org/depletion2_022.htm

We knew that the price of oil was going to decline...

[MonteQuest]

$this->bbcode_second_pass_quote('Outcast_Searcher', ' ')I'm just not buying it, literally or figuratively, any more than I pay attention to astrologers.

[Outcast_Searcher]

$this->bbcode_second_pass_quote('MonteQuest', '')$this->bbcode_second_pass_quote('Outcast_Searcher', ' ')I'm just not buying it, literally or figuratively, any more than I pay attention to astrologers.

[MonteQuest]

$this->bbcode_second_pass_quote('Outcast_Searcher', ' ')Oh, and it's easy to notice something on a chart from history, and then claim the same thing is about to happen. It's been done on this site by the short term crashers many, many times in the past 5+ years. The results though have been dreadfully inaccurate a huge percentage of the time.

[ennui2]

$this->bbcode_second_pass_quote('MonteQuest', '
')So, raising interest rates in the middle of a recession this time won't tank the market? Oops! It already has. Down 10% already for 2016. Can we make 54%?

[ennui2]

$this->bbcode_second_pass_quote('pstarr', '')$this->bbcode_second_pass_quote('ennui2', 'T')he Fed is in a a no-win situation because it's been damned for years for interest rates being low, and it will be damned for raising them if they connect that raise to anything negative going on with the economy.

[Tanada]

$this->bbcode_second_pass_quote('ennui2', '')$this->bbcode_second_pass_quote('MonteQuest', '
')So, raising interest rates in the middle of a recession this time won't tank the market? Oops! It already has. Down 10% already for 2016. Can we make 54%?

[Pops]

Stock values are down because they were too high. LOL

The price of stocks compared to what the companies actually earn was 75% higher than the long term average.

PE = 26x and even that measure is artificially LOW because of all the cheap money the corps took on that will be there for decades—literally, the average bond last year doesn't mature for something like 25 years!

PEs were too high because interest rates were too low.
Rates were too low because the fed was recapitalizing the banks.
Banks needed recapitalizing because they were allowed to "self-regulate".
De-regulation goes back decades but has accelerated and banks are now running the show both inside and outside government.


I don't think it was the increase in rates that skeered investors, if they were not in a coma the last couple of years they likely heard rates were going to rise.
Ditto China, it's been slowing from its peak growth rate for 5 years now and publically said they were planning for slower growth.
Same with oil, it's been clear a big reset would happen for a year now. (and of course outside TX & OK everyone is happy with low oil price)


I think the markets are adjusting away from bank deregulation that has been bought by the owners via the political system.

We need to vote for our own economic interest, while we still can.

.

[MonteQuest]

$this->bbcode_second_pass_quote('ennui2', '')$this->bbcode_second_pass_quote('MonteQuest', '
')So, raising interest rates in the middle of a recession this time won't tank the market? Oops! It already has. Down 10% already for 2016. Can we make 54%?

[MonteQuest]

$this->bbcode_second_pass_quote('Pops', 'S')tock values are down because they were too high.

[Pops]

$this->bbcode_second_pass_quote('MonteQuest', '')$this->bbcode_second_pass_quote('Pops', 'S')tock values are down because they were too high.

[sparky]

.
The market react to the market , a trader can make as much money buying as selling ,
Ultimately there is no past or future only the present and positions

still , MonteQuest has a point about a lot of "money" sloshing about

[MonteQuest]

$this->bbcode_second_pass_quote('Pops', ' ')Are you saying only we few omnipotent gurus on this board can see reality?

[Pops]

$this->bbcode_second_pass_quote('sparky', 'M')onteQuest has a point about a lot of "money" sloshing about

[ennui2]

And what the US taxpayer got back in return so far has been a slow but steady recovery in employment, plus cheap gas. Sure beats the performance vs. FDR era great depression. And it's not like the Fed raised rates that much. They barely nudged rates in order to test the waters. So I wouldn't say the Fed hasn't learned from the GD. I remember some interviews on 60 minutes at the time where they said they had studied the GD in great detail and tried to do things differently. Now, if you think market manipulation like that can never work, that the system should just be allowed to fall flat on its face, fine, but I'd say so far it's been quite a successful magic act dancing on the head of this pin.

[MonteQuest]

$this->bbcode_second_pass_quote('Pops', 'A')ll I'm saying it's not an "illusion"— the bailed banks didn't fail.

[Pops]

$this->bbcode_second_pass_quote('MonteQuest', 'N')one of that is true. Taxpayers weren't on the hook for QE.

[MonteQuest]

$this->bbcode_second_pass_quote('Pops', '')$this->bbcode_second_pass_quote('MonteQuest', 'N')one of that is true. Taxpayers weren't on the hook for QE.