Andrew Huszar, He Did U S Q E1 And He Says ' I'm Sorry America...'

[JPJPJP]

Andrew Huszar was in charge of 'doing' QE1 in the USA

Back in the autumn last year he wrote some pretty scathing stuff about in the WSJ

http://online.wsj.com/news/articles/SB10001424052702303763804579183680751473884

And here is a recent interview with him Mike Covel - its a good listen

http://traffic.libsyn.com/trendfollowing/251.mp3

There is a lot in here, the bits that resonated with me on first listen...

- QE1 was The Fed essentially purchasing 10% of the US housing stock

- Despite QE driving the ten year T bill yield below 1.5%, mortgage rates in the US never really went below 3.5%

- Every transaction the Fed did to buy an MBS had, of course, commission / fees to be paid (to a bank). Hundreds of millions of dollars of fees were paid

[TheCountOfNowhere]

Andrew Huszar was in charge of 'doing' QE1 in the USA

Back in the autumn last year he wrote some pretty scathing stuff about in the WSJ

http://online.wsj.com/news/articles/SB10001424052702303763804579183680751473884

And here is a recent interview with him Mike Covel - its a good listen

http://traffic.libsyn.com/trendfollowing/251.mp3

There is a lot in here, the bits that resonated with me on first listen...

- QE1 was The Fed essentially purchasing 10% of the US housing stock

- Despite QE driving the ten year T bill yield below 1.5%, mortgage rates in the US never really went below 3.5%

- Every transaction the Fed did to buy an MBS had, of course, commission / fees to be paid (to a bank). Hundreds of millions of dollars of fees were paid

Im amazed people have put up with this.

[zugzwang]

Not to mention the enormous stock market buybacks that the free QE cash has encouraged corporate America to make, coincidentally facilitating the purchase of stock option grants that the same corporate executive had issued to itself. A nice racket, especially as it's legal.

Edited August 1, 2014 by zugzwang

[sPinwheel]

I assume he was well paid to do it.

[TheCountOfNowhere]

Not to mention the enormous stock market buybacks that the free QE cash has encouraged corporate America to make, coincidentally facilitating the purchase of stock option grants that the same corporate executive had issued to itself. A nice racket, especially as it's legal.

That's the long and the short of it. They tell us democracy is for the people but currently its for the banker people!

[Corruption]

It was a good listen but all he told me is what i already know.

Im sure Winston Smith comes up with similar sentence to the one i wrote above in Orwells 1984 in relation to the govt.

[zugzwang]

Except in banking and finance, QE has done nothing whatsoever for full time job creation. The ratio of full time jobs to the population now stands at 48.3%, 0.1% lower than in July 2009, four months after the stock market bottom. The annualised rate of full time job creation has been running at a paltry 1.0-2.0% for the last four years regardless of whether QE has been running full-tilt or in a pause (as was the case for much of 2011-12).

There are 3.3 million fewer full time jobs today than in July 2007. A 13% gain in stock prices over the past twelve months and July's full time job growth rate came in at just 1.92% annualised. Ben Bernanke's wild idea that stock market gains from QE would stimulate job growth has been comprehensively falsified.

[wonderpup]

Ben Bernanke's wild idea that stock market gains from QE would stimulate job growth has been comprehensively falsified.

David Stockman makes the same point that Steve Keen makes- debt does matter in economics;

What has happened is that the Fed’s historic credit expansion channel of monetary transmission has been frozen shut ever since day one of the massive Bernanke monetary expansion which began in August 2007, but went into warp-drive in the weeks after the Lehman event a year later.

Yet this madcap money printing campaign was a drastic error because it failed to account for the immense roadblock to traditional monetary stimulus that had been built up over the last several decades—namely, “peak debt” in the household and business sector. This condition means that monetary easing and drastic interest rate cuts have not elicited a surge of consumer borrowing and business capital spending and hiring as during past business cycle recoveries.

http://davidstockmanscontracorner.com/dont-buy-this-dip-the-fed-is-not-your-friend/

[zugzwang]

David Stockman makes the same point that Steve Keen makes- debt does matter in economics;

http://davidstockmanscontracorner.com/dont-buy-this-dip-the-fed-is-not-your-friend/

Bernanke then spent the next five years trying to persuade Americans that the US was on the mend, a fallacy that Yellen appears set to compound by raising rates against the backdrop of a softening economy. Wage inflation tells the truth. Outside of the public sector, briefly catching up after years of stagnation, and the bubble in shale extraction, there is none.

Edited August 3, 2014 by zugzwang

[spyguy]

Bernanke then spent the next five years trying to persuade Americans that the US was on the mend, a fallacy that Yellen appears set to compound by raising rates against the backdrop of a softening economy. Wage inflation tells the truth. Outside of the public sector, briefly catching up after years of stagnation, and the bubble in shale extraction, there is none.

The UK and US are economies being bled dry by debt, which was incurred in during a half-witted period, 2000-2007, to get high-level of politically motivated growth.

We've been Wonga'd!

[evetsm]

I don't accept that they did not know that QE would not work. This institutionalised fractional reserve debasement is over 700 years old. They know exactly what it implies. This is the criminality of the exercise. It only helps one sector, and only ever has, so you have to doubt their professed surprise.

[JPJPJP]

I don't accept that they did not know that QE would not work. This institutionalised fractional reserve debasement is over 700 years old. They know exactly what it implies. This is the criminality of the exercise. It only helps one sector, and only ever has, so you have to doubt their professed surprise.

I think the surprise is more about how easily they 'got away with so much' isn't it?

At least one generation and likely several are indebted to pay for this. And it still isn't over!

[200p]

Mike Covel wrote Trend Following.

Trend followers want trends to continue forever, just like inflation, QE. Etc. It makes trades easier, and riding the trends a no brainer.

The SP500 is having an amazing run. IF or when it breaks through the 2000 pts barrier, and continues on upward, that would be a celebratory moment, and the status quo continues.

The system right or wrong, has no moral obligation. Don't like it? Then choose barter or real money. 2008 was supposed to be a deciding moment for gold, but the masses chose to accept the fiat money ride.

[200p]

A quick Google, and Andrew has done an interview with Eric King (does he still own one tonne of silver?), the precious metal super bull. UKIP Nigel Farage, was a commodity trader and has been on that Kingworld news show.

http://kingworldnews.com/kingworldnews/Broadcast/Entries/2014/8/3_Andrew_Huszar.html

Andrew Huszar - goldbug? EDIT - Yes he is, about 10m30s in.

Edited August 3, 2014 by 200p

[gf3]

I think if they had done QE and handed the money out like Steve Keen suggests it would have been better.At least we could have had some fun on the way down. As it is only the 1% really gained.

[zugzwang]

I think if they had done QE and handed the money out like Steve Keen suggests it would have been better.At least we could have had some fun on the way down. As it is only the 1% really gained.

It wouldn't have been pretty but it might have laid the groundwork for a legitimate recovery. They chose instead to keep the ponzi going by borrowing and spending on an unprecedented scale, so now we're facing the same challenge we did in 2008 but with an additional £2 trn of debt to roll over on a continuous basis.

[gf3]

I've come to the conclusion there are only two endings to this.

1. Perpetual creeping erosion of the standard of living, ending in something akin to the serfdom operated by the Normans. An increasingly sophisticated system to close down and warp the new information sources that is making life uncomfortable to the Establishment.

OR

2. A fundamental change to (land) tax and a change to the debt based monetary system.

I will go along with that.

Lower yield will be the future with the rich asset holders pulling away unless there is a revolution. hopefully a bloodless one.

I am on a mailing list of a local positive money group. This is a video being discussed at the moment.

nothing we don't already know to be honest but it may happen somewhere else and spread here.