Monday, Nov 09, 2009
The 'Q' word again.
Zero Hedge: The Fed's Nemesis: Exter's $2 Quadrillion Of "Liquidity"
Another representation of what will likely become a prevalent topic in upcoming days: the Exter pyramid. When the system works, the various layers are in equilibrium. When the system is broken, like it is now, the Fed and all Central Banks try to refill the pyramid from the bottom-up with every single dollar they print. The current temporary calm is all Bernanke can hope to achieve before $2 quadrillion of liquidity collapses onto whatever truly tangible assets exist. They don't call it a pyramid scheme for nothing.
Posted by devo @ 12:25 PM (746 views) Add Comment
18 Comments
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1. mountain goat said...
I think this pyramid is interesting because it is informative about how safe the various assets and derivatives are. But gold bugs (I include myself) need to be aware that Exter was a central banker who worked at the federal reserve in the 1940s and 1950s. You can't wipe away decades of fiat money just like that. The dollar now fulfills many of the functions reserved for gold when this pyramid was conceived. When it comes to paying back debt when your derivatives higher in the pyramid crash, most creditors today will want cash not little bars of gold.
2. crunchy said...
Meanwhile watch gold hit $1300. AUD/USD races away right from the open. $$$$$$$$ lol
3. devo said...
4. crunchy said...
The secret is in the open "timeline" and creative market orders. My little kid knows how to trade this simple profitable system. D'oh.
The house price crash is in your own hands.
5. timmy t said...
Can someone with a brain bigger than mine tell me what this means please?
6. devo said...
51ck-6-51x is clever. He'll explain it.
7. crunchy said...
I just have, but people here "think" that they are just too smart. Love it!
That's why people on here are not talking about "cap and trade." D'oh!
You think house prices are a problem? Oh boy!!!! Bless.
8. timmy t said...
Crunchy - no you didn't, you wrote some garbled gibberish as usual.
9. crunchy said...
timmy
Makes more sense than quantitative easing, but it's just more direct. Honest!
Do look up Cap and Trade if you would prefer to stop "beating about the bush" a new one for the repertoire of the sheeple.
Looking forward to it. ; )
10. crunchy said...
Time to take profit tech, for now.
11. timmy t said...
Crunchy, are you called crunchy because your head is full of honeycomb?
12. tyrellcorporation said...
Crunchy do you possess a random sentence generator?
I'm totally bamboozled by your comments.
13. crunchy said...
12. tyrellcorporation
I call it uncommon sense. Perhaps it comes easier to the uncommon man.
Unfortunately even being part of a minority will not secure a just outcome. It will be a minority of the majority of that minority which make
independent unbias choices with a clear mind that will not be manipulated. No I don't T.
Trading overnight. TTFN.
14. charlie brooker said...
Last year scheme of us made analogies between the catastrophic state of the financial system and the cloud of volcanic gas, dust and ash that spewed out of Vesuvius to hanging over Pompeii.
Any similarities between the shape of such volcanic clouds and the diagram above are purely coincidental, of course.
15. timmy t said...
"It will be a minority of the majority of that minority which make independent unbias choices with a clear mind that will not be manipulated"... Could someone please throw that huge marble sink through the window so Crunchy can escape...
16. inbreda said...
I think crunchy likes talking to himself. God knows why he has to involve teh rest of us though.
17. hpwatcher said...
Crunchy has been on the caffine again......
18. rumble said...
"7. crunchy said...
I just have, but people here "think" that they are just too smart. Love it!"
Love that.
Timmy, no explanation huh? i'll try to trigger one with a flawed one: it's basically saying everything is inflated with hot air credit, and they need to deflate but there are vain attempts to keep it all pumped up, and as they inevitably devalue, people will remove their wealth from these collapsing pieces of garbage and stick it in things that have genuine intrinsic value such as gold, and as there is so much wealth in the garbage higher up the upside down pyramid, when it all gets pushed into the gold at the bottom the price will go to space. As MG points out, that assumes the fiat is unable to replace gold.