Home > Federal Reserve To Crash Markets Before Launching QE3? (INDEXSP:.INX, SPY, TZA, GLD, FAZ)
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Federal Reserve To Crash Markets Before Launching QE3? (INDEXSP:.INX, SPY, TZA, GLD, FAZ)

August 29th, 2012

Dominique de Kevelioc de Bailleul: Desperate to print Wiemar-style to fight off the most viscous Kondratiev Winter on record, Federal Reserve Chairman Ben Bernanke may not satisfy ‘inflation trade’ onlookers at the close of his Jackson Hole speech scheduled Friday.  He may, instead, merely allow months of anticipatory front-running of stocks do the work of propping up asset prices for him. Get my next ALERT 100% FREE

And if investors don’t get the ‘all-systems go’ at Jackson Hole, there’s always the FOMC meeting of Sept. 12 & 13 to get the good news.  That’s when market volatility could move off the charts, maybe extreme volatility to the downside, according some Wall Street analysts.

“With the equity market pricing in a significant chance of QE3, stock prices are no longer as useful a signal to Fed officials. Should the Fed disappoint at its September policy meeting, the risk of a stock sell-off is high,” Bank of America Merrill Lynch analysts wrote in a note to clients, Aug. 21.


“Some in the markets think that the Fed effectively targets equity prices, meaning that to predict Fed policy, one merely needs to track the U.S. stock market,” the analysts add.  “There is a curious circularity to this view, however: the Fed will not launch QE3 so long as stock prices are high, yet the stock market is high because it anticipates QE3.”

The old adage on the Street, ‘buy the rumor, sell the fact’, may be at play here. But if Bernanke plays too-hard-to-get with investors in the coming weeks, a nasty fall could be in store for the Fed chief—a fall that could outright overwhelm the NY Fed’s PPT and result in a stock market plunge akin to the Crash of 1987.  Maybe.

The chart of the S&P 500, Spanish IBEX 35 and Chinese SSEC shows the gaping chasm between U.S. stocks and two indexes represented by two economies with, again, divergent outlooks.  Spain’s fiscal outlook in coming years isn’t much different from the federal budget outlook for the U.S., while the Chinese $3 trillion war chest of reserves couldn’t be in a better relative position to survive the righting of the bogus ‘World is Flat’ global agenda.

Would Bernanke risk a market meltdown that snaps the notion of an eternal ‘Bernanke put’?  Is he that confident that the remaining holdouts of an obviously rigged market will plunge the world economy into the anticipated financial Armageddon—before a U.S. presidential election?

The answer may be a shocking, even cockamamy—YES and YES!  And it may not be that much of a risk.  A surprise ‘not yet’ to further money printing at Jackson Hole and the FOMC meeting could be forthcoming.

Consider the geopolitics in the Middle East, and contemplate the dire political tug-o-war between Israel’s Prime Minister Benjamin Netanyahu and U.S. President Barrack Obama regarding Iran.  Netanyahu insists military action against Iran be taken before the U.S. election in November, while Obama remains adamant that the issue surrounding Iran must wait until after the election—a stand which probably infuriates the warmongering neocons and bankers, who have since put their stock on Republican candidate for president Mitt Romney as their next bankster puppet.

And the white-hot ambitious, some say, narcissistic, Romney won’t be taking any chances leading up to what is expected to be a close election, if recent polls serve as a guide.  He may need a little help from a financial catastrophe to convince enough voters that they may have to believe in a different kind of change.

But first, Romney must take the pledge—for the record.

Jul. 29, he told a gathering of Israelis in Jerusalem:

“We serve the same cause and we provoke the same hatreds in the same enemies of civilization. It is my firm conviction that the security of Israel is in the vital national security interests of the United States . . .

“Israel and America are, in many respects, reflections of one another.  We both believe in democracy, in the right of every people to select their leaders, and choose their nation’s course. We both believe in the rule of law, knowing that in its absence, willful men will be inclined to oppress the weak. We both believe that our rights are universal, granted not by our government, but by our creator.”

Later in the speech, Romney spoke the magical words that signaled the Netanyahu regime that he, not Obama, is your man.

Stopping Iran from acquiring nuclear weapons “must be our highest national security priority” and “we must use any and all measures” to destroy that capability.

“Containment is not an option,” Romney added.

And because “both men [Obama and Netanyahu] share a deep dislike and distrust of each other,” writes Anshel Pfeffer of the leftist Israeli newspaper Haaretz, the Israeli and Anglo-American mutually aligned partnership in the petrodollar wars must not be jeopardized by a Commander and Chief not willing to do what’s necessary, in the eyes of the neocons, of course. GET A FREE TREND ANALYSIS FOR ANY STOCK HERE!

Therefore, Obama must go, leaving the banking cartel’s lead man at the Fed, Bernanke, to continue manipulating the markets, but this time, to the downside to throw the game for Romney and the neocons at this critical moment (for Israel) in the Middle East.  Bernanke can always come in with a bazooka money blast and ‘make things better’ for Wall Street while putting that one last lid on the gold price (maybe) before the out-of-control launch of the yellow metal truly begins during the first year of a Romney first term.

“If the S&P drops 150 or 200 points, you can be sure that there will be more QE, not only QE3 but QE4 and so forth,” Swiss money manager Marc Faber tells GoldSeek Radio this past weekend.

But, not to worry. QE is coming, but a little politics comes first to nail down decades-long geopolitical strategy in the oil patch concerning a much bigger war between the U.S., Russia and China regarding the U.S. dollar and the gold price.

Though Faber doesn’t speculate on the upcoming Fed actions, he does state “it’s premature to say that this a genuine breakout” in gold and silver, and I “say that with great confidence.”

Related Tickers: S&P 500 Index (INDEXSP:.INX), SPDR S&P 500 ETF (NYSEARCA:SPY), SPDR Gold Trust (NYSEARCA:GLD), Direxion Daily Small Cap Bear 3X Shares ETF (NYSEARCA:TZA), Direxion Daily Financial Bear 3X Shares ETF (NYSEARCA:FAZ).

By Dominique de Kevelioc de Bailleul From Beacon Equity Research

BeaconEquity.com is committed to producing the highest-quality insight and analysis of small-cap  stocks, emerging technology stocks, hot penny stocks and helping investors make informed decisions. Our focus is primarily OTC stocks in the stock market today, which have traditionally been shunned by Wall Street.  We have particular expertise with renewable energy stocks, biotech stocks, oil stocks, green energy stocks and internet stocks. There are many hot penny stock opportunities present in the OTC market everyday and we seek to exploit these hot stock gains for our members before the average daytrader is aware of them.


NYSE:FAZ, NYSE:GLD, NYSE:SPY, NYSE:TZA


 

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  1. market zone
    December 1st, 2012 at 05:32 | #1

    What is QE3 in the stock marketing.?

  2. How to Play the Stock Market Online
    November 30th, 2012 at 07:09 | #2

    What is demutualisation of stock exchanges?

  3. Constitutional Defender
    October 23rd, 2012 at 14:42 | #3

    @James
    If there is to be a market migration toward precious metals, do you think human beings would be move readily apt to move toward that noble cause by way of the “carrot” or “the stick” ? When you answer that, you might find that some evils are necessary in “the script”. Follow the script …. they do.

  4. Constitutional Defender
    October 23rd, 2012 at 14:26 | #4

    We need a drastic shift in thinking and in our whole paradigm. What if the answer is in front of us ? What if the answer is a bottom-up process that rises from the grass roots while we all gaze, mindlessly, up at the elite, expecting them to provide an answer ??? On the basis that precious metals now float in real-time, PM values have the potential to wipe out fiat based debt. How ? Simple monetization and circulation in order to support economic activity while fiat based currency can be freed up to find the hands of the debtors who need it to service existing fiat based debt in order to have that debt removed and destroyed. Gresham’s Law, as it pertained to bullion, only pertained to bullion when the value was FIXED ! The most difficult thing to recognize is that the elite are helpless to bring this about without the marketplace governing rate of change. For gold to be brought back into the monetary fray (in real-time), by way of a top-down proclamation, would be an almost instant disaster for the dollar. In the migration from any legacy system (USD) to a new system (real-time gold-as-money), a crash in either system could prove to be disastrous. The charge of making the transition , therefore, must rest with the marketplace, bottom-up. The USD’s ultimate role is not that of a currency at all. It’s been a stop gap measure in its pure debt form since 71. The USD’s ultimate role is in assistance to gold-as-money, as a real-time measure ($/oz) in a real-time gold-as-money paradigm. God may be slow but never late.

  5. Jonas
    September 2nd, 2012 at 11:03 | #5

    It’s “Weimar”, not “Wiemar-style” – even if it is hard for you to comprehend as it seems backwards pronunciation wise..

  6. Obama
    August 30th, 2012 at 14:48 | #6

    HELLO GOATSE!

  7. jj
    August 30th, 2012 at 06:37 | #7

    9-11 inside job

  8. Peter Palms
    August 29th, 2012 at 16:33 | #8

    The US Department of Homeland Security and the Immigrations and Customs Enforcement Office have placed an order for 450 million rounds of .40 caliber bullets. The amount of ammo exceeds the amount of people that live in the US and many wonder the motives behind the vast purchase. The contractor Alliant Techsystems is the company supplying the ammunition to DHS and ICE and although the agencies claim these bullets are to be used for target practice many believe they have something else in mind. Hollow points are not training ammo. All amunition is leathal. Hollow points are not made for penetration, but rather expansion to create a greater shock, and crush wound.You can’t use HP for target practice because it makes a messy hole in the target material (paper/wood) because it expands, also it’s more expensive. Finally DHS has ordered over ONE BILLION rounds. They even ordered ammunition via other Gov. agencies that do not even use firearms like Forestry

    The National Guard is not the constitutional authority for protecting this country, it is the Militia.On average, the US military used about 70 million rounds per YEAR during the war in Iraq. Are they preparing for wide spread civil unrest.

    President Obama has issued an executive order, titled “National Defense Resources Preparedness”, which instructs the heads of various U.S. agencies to be on standby of the authorization of martial law under by the Secretary of the Department of Homeland Security.

    The order in fact gives Executive Branch immediate to power to seize and control of any and all assets declared as critical to maintain its industrial and technological base and to control the general distribution of any material (including applicable services) in the civilian market

    The order further authorizes the immediate issuance of regulations to allocate, ration, or seize and all materials, including every thing from food, live stock and farm equipment to transportation, energy and even water!

    Under this order the heads of these of cabinets of Agriculture, Energy, Health and Human Services, Homeland Security, Transportation, Defense and Commerce can seize or ration any food, livestock, fertilizer, farm equipment, all forms of energy, all forms transportation and all other materials, including construction materials.

    The order has been issued under the premise that the United States must maintain its industrial and technological base to maintain National Security and National Defense, which includes giving assistance to foreign nations, during times of war and times of peace.

    Some of the oddest provisions include the allocation of water authority to use chemical and biological weapons being delegated to the Department of Defense, and the authority to place items owned by the Federal government in private property as well as sell Federal government property to private individuals.

  9. James
    August 29th, 2012 at 13:54 | #9

    How tragic that a once free country is now held ransom by an unconstitutional Fed banker that does as he pleases. Andrew Jackson was forever right to battle against the Second National Bank. Bernanke prints trillions more of our dollars and increases our debt out the wazoo, debasing our currency ala 1920s Germany. Obama says no to Iran before the election? Anyone that believes that denial would have fallen for the von Ribbentrop non aggression pact with Moscow of 1939. The only question is…..who is the National Socialist standing in the wings…..ala Adolf? It is not a difficult question.

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