The Fed is FREAKING OUT

Zerohedge reports that Why You Should be Freaked Out About the Stock Market.

(emphasis mine) [my comment]

Why You Should be Freaked Out About the Stock Market
Submitted by Phoenix Capital Research on 03/25/2011 18:35 -0400

I doubt you will see this chart in the mainstream media any time soon... if EVER. [Agreed]

http://www.zerohedge.com/sites/default/files/images/user20289/imageroot/fredgraph.png

This is a chart of the US monetary base. In simple terms, it charts how much money the Fed has pumped into the system (at least that it admits). So it' s a kind of visual of the Fed hitting the PANIC button: when the monetary base explodes higher, the Fed is FREAKING out.

You'll note that
during the Financial Crisis the Fed didn't do much until the autumn of 2008 when it pumped nearly $1 trillion into the system. Think about that, the Fed didn' t go nuts pumping money until the stuff REALLY hit the fan.

You'll also note that there's only one other time when the monetary base went absolutely vertical: TODAY.

Indeed,
the Fed has pumped nearly $500 billion into the system since the start of 2011. Don't even try to tell me this is QE 2. If it was then the monetary base should have spiked in late 2010, NOT in 2011.

No,
this is the Fed FREAKING OUT about the financial system again. And it's a freak out on par with 2008.

So if you think that all is well "behind the scenes" you're in for a rude surprise. Something BIG is going down and it's NOT good.

And rest assured,
by the time the mainstream media announces what it is, it will already be in full swing.


Fed's Liabilities Broken Down (in billions)


Full Resolution


My reaction:  The Fed is FREAKING OUT.

1)  The Fed has pumped nearly $500 billion into the system since the start of 2011.

2)  All is NOT well "behind the scenes".  "Something BIG is going down and it's NOT good."


Conclusion:  There is no recovery.  As I said before, the world is headed towards a disconnect.  The markets will freeze (a big "bank holiday"), and, once people understand what is going on, the dollar will be worthless.

By the time a Ponzi scheme is "officially confirmed", it is too late to do anything about it.

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4 Responses to The Fed is FREAKING OUT

  1. Yohay says:

    So, if it's already +500 billion from the beginning of the year instead of 225 billion (75 a month times 3), how much money was already spent since November? This does look bigger than expected, especially on the backdrop of comments about stopping QE2 and not continuing to QE3.

  2. edu says:

    Buy gold and silver and wheat with both hands!

  3. Tuomas Pietila says:

    In fact the increase in monetary base is still QE2 which indeed was supposed to start only in early 2011 as per FED statements when it announced the action. This increase should continue through June (in November the QE2 time frame was announced as 8 months) after which QE2 money has been spent. Though the original $600 billion commitment seems to be exceeded if the current pace continues until the Summer. However, in November FED also told they would spend additional $250-300 billion in Treasuries from proceeds from previous investments, which would lead us to see BASE of nearly $2900 billion (if the "free" cash FED holds is not included already in it).

    http://www.bloomberg.com/news/2011-03-29/fed-s-bullard-says-qe2-exit-debate-likely-key-2011-issue.html

    "The bond purchases aimed at stimulating the economy -- a policy known as quantitative easing -- will total up to $900 billion and be completed by the end of the third quarter of 2011. "

    Do I remember it correctly that it takes about 6 months for BASE increases to show up in real economy?

  4. peter pant says:

    Great article,thank you , as usually perfect.
    bank holiday is coming

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