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".......But credit as a whole remains resilient or at least static because of a multitude of quantitative easings (QEs) in the U.S., U.K., and Japan. Now it seems a gigantic tidal wave of QE is being generated in Euroland, thinly disguised as an LTRO (three-year long term refinancing operation) which in effect can and will be used by banks to support sovereign bond issuance. Amazingly, Italian banks are now issuing state guaranteed paper to obtain funds from the European Central Bank (ECB) and then reinvesting the proceeds into Italian bonds, which is QE by any definition and near Ponzi by another."
http://www.pimco.com/EN/Insights/Pages/Towards-the-Paranormal-Jan-2012.aspx
http://www.pimco.com/EN/Insights/Pages/Towards-the-Paranormal-Jan-2012.aspx
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And just to prove that some of us are awake long before Gross penned his latest note:
Menelaus 26 Dec 11 22:22
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The real issue however is that the system is facing a monetary crisis first, and then an economic crisis. When Italian banks issue bonds, get a government guarantee on those bonds, buy back their own issued bonds, then pledge them to the ECB as collateral to get cash, we are waaaay beyond printing money out of thin air. We are in Alice in Wonderland money system territory.
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Menelaus 26 Dec 11 22:22
...............
The real issue however is that the system is facing a monetary crisis first, and then an economic crisis. When Italian banks issue bonds, get a government guarantee on those bonds, buy back their own issued bonds, then pledge them to the ECB as collateral to get cash, we are waaaay beyond printing money out of thin air. We are in Alice in Wonderland money system territory.
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Gold has run up $75 since you decided to start 2012 by taking a shot.
Has is that working out for you?
Has is that working out for you?
menelaus knows his stuff. buy on the dips is the way forward.
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