"[The Federal Reserve] can cause the pendulum of a rising and falling market to swing gently back and forth by slight changes in the discount rate, or cause violent fluctuations by a greater rate variation and in either case it will possess inside information as to financial conditions and advance knowledge of the coming change." - Charles Lindbergh
If the FOMC is buying Treasuries, maybe you should too?
Hi fdr,
ReplyDeleteThe Fed is buying MBS from Fannie mae also...Why it can't lead to hyperinflation in the future?
Bullforever
Hi Bullforever,
ReplyDeleteI wish I could transfer ownership of all the bad mortgages in America to myself for a few cents on the dollar, using nothing but my color printer, but they won't let me.
It isn't hyperinflationary because now the cost basis of each foreclosed home in the security is a couple of bucks. That is just what we need, a new nationwide owner who can sell the house down the street for $1,000 and double his money.
I have been developing and brokering property for some time now. If ever I wanted to swindle every homeowner out of their land, I would do it exactly the same way. I would by notes for pennies on the dollar, be they foreclosed or not. The cost basis of acquisition is so minimal that I would be able to sell the homes for dimes on the dollar and make a bigger profit margin than I would otherwise.
ReplyDeleteBrilliant and slick way of swindling people while also introducing Socialism. The people who are responsible for this are perfectly aware of what they are doing, it is not by mistake.
Wilsondidit
Hi FDr,
ReplyDeleteWell with monopoly currency you can buy all the money you want.
Bullforever
once they're done buying, mark to market rule will be suspended and price adjusted to retroactivate 2008 levels.
ReplyDeleteThe market moved so fast after Bernanke's speech. I mean the Euro/$ and Gold/$.
ReplyDeleteA bit suspicious don't you think ? Within minutes the implications were absorbed and the necessary calls made to brokers.
Especially after a nice head and shoulders appears on the gold chart and all the short specs have aleady been sucked in.