Spamdex - Spam Archive

Report spam

Send in your spam and get the offenders listed

Create a rule in outlook or simply forward the spam you receive to questions@spamdex.co.uk

Also in e.moneyandmarkets.com

The Real Reasons Yellen Didn't Raise Rates

Having trouble viewing this email? View it online.
Monday, September 21, 2015
Money and Markets
YOUR BEST SOURCE FOR THE UNBIASED MARKET COMMENTARY YOU WON'T GET FROM WALL STREET
The Real Reasons Yellen Didn't Raise Rates
by Martin Weiss

Dear ,

Martin Weiss

Fed Chairman Yellen says the Fed didn't raise interest rates last Thursday primarily because of low inflation and turbulence overseas (i.e. China).

But behind what she says, there's a heck of a lot more going on that she would never say:

  • She realizes the U.S. economy is a lot weaker than the Fed is letting on.
     
  • She's worried about making the financial and political turmoil in Europe and the Middle East even worse, with major spillover effects on the U.S.
     
  • She doesn't want to make the U.S. dollar even stronger — and the U.S. even less competitive — especially on the heels of the greenback's biggest winning streak since 1984.
     
  • She's aware of the fact that, as rates rise, the interest costs will rise for heavily indebted governments in Western Europe, Japan and the U.S., leading to a new, larger sovereign-debt crisis.

Plus, most important, she's terrified of the ...

Two Elephants in the Room

The first elephant is the pervasive impact on society of over six long years of zero interest rates. Even during World War II — the greatest existential threat to our nation since Independence — the Fed didn't push rates down that far or hold them down for that long. The result has been a massive shift in the psychology, the strategy and the portfolios of millions of investors, corporations and consumers:

Investors who have shifted, en masse, from safe-haven investments to risk assets ...

Businesses who have borrowed heavily by floating trillions of dollars in new junk bonds, and ...

Consumers who have drained their savings to new lows and favored floating-rate debts like never before.

Multiply Your Money!

I'm so confident that simply by taking the right steps now, you can USE these fast-breaking events to multiply your money ... I am ready, willing and able to give you everything you need to help protect and multiply your wealth in 2015 — absolutely FREE! Click here to view now! –Larry

Internal Sponsorship

All because of zero interest rates! All creating rows of dominoes that are potentially very vulnerable to any rate hike!

The second elephant in the room is the massive amounts of new funny money the Fed has pumped into our economy since September 2008 ... and the speculative bubbles it has created.

Since 2008, we've seen the emergence of a $2.2 trillion bubble in small-cap stocks, a $1.81 trillion bubble in domestic junk bonds, and a series of even larger bubbles in other debts globally — all extremely vulnerable to higher interest rates.

I'll get to the bubbles in upcoming Money and Markets editions. Today, let me first show you — graphically and vividly — exactly where they're coming from.

This chart says it all. —>

Throughout history, the U.S. Federal Reserve almost always expanded the nation's monetary base (bank reserves and money in circulation) at a relatively steady pace.

Then, suddenly, in September 2008, the Fed began running its money printing presses like never before.

What triggered such an incredibly massive and abrupt policy change at the Fed?

Answer: The single most shocking financial failure of our era — Lehman Brothers.

But even as Fed governors sought to save the world from collapse, they discovered three things:

First, they discovered that lowering their official interest rates to zero percent, although extreme, was not enough. "What good was making money cheap," they said, "if there was no money being borrowed?" (That's when they decided to open the money floodgates.)

Second, the whole concept of "printing money" sounded too much like what Germany did after World War I, creating massive inflation. Thus, to avoid sounding like money madmen, they coined a more erudite phrase — "quantitative easing" or "QE."

Third, they realized that just one round of QE still wasn't enough. American consumers, investors and businesses got so addicted to all the new Fed funny money, they needed new shots in the arm year after year. As a result, the Fed embarked on three major rounds of QE, called QE1, QE2 and QE3.

Clearly, the day that Lehman Brothers failed, the Federal Reserve — and the entire financial world as we know it — changed dramatically.

How dramatically? Consider these facts:

Fact #1. Just from Sept. 10, 2008, through March 10, 2010, the U.S. Federal Reserve increased the nation's monetary base from $850 billion to $2.1 trillion — an insane increase of 2.5 times in just 18 months. It was, by far, the greatest monetary expansion in U.S. history.

Fact #2. Before the Lehman Brothers collapse, it had taken the Fed a total 5,012 days — 13 years and 8 months — to double the monetary base. In contrast, after the Lehman Brothers collapse, it took the Fed governors only 112 days to do so. In other words, they accelerated the pace of bank reserve expansion by a factor of 45 to 1.

Fact #3. Even in the most extreme circumstances of recent history, the Fed had never pumped in anything close to that much money in such a short period of time.

For example, before the turn of the millennium, the Fed scrambled to provide liquidity to U.S. banks to ward off a feared Y2K catastrophe, bumping up bank reserves from $557 billion on Oct. 6, 1999, to $630 billion by Jan. 12, 2000.

Important Update for Men and Women Born Before 1969
"Introducing Ronald Reagan's Secret Retirement Income Plan"

Few people know this... but during his 1986 tax reform, Uncle Ronnie stumbled onto something that guarantees no American today need ever run out of money in retirement.

It's an IRS-approved tax-free source of income that can pay almost 2 times more than Social Security...

If you qualify, it could pay you up to $4,098 per month, on top of any other benefits you receive... And that's only the beginning...

Joe Biden invests his money in this retirement plan. Hillary Clinton does, too. Now, if you meet two small criteria, so can you... And we'll send you a starter kit for FREE.

Click here to see if you qualify.

External Sponsorship

At the time, that sudden increase was considered unprecedented — a $73 billion in just three months. In contrast, from September 2008 through September 2015, the Fed increased the monetary base by $3,225 billion or 44 times more.

Similarly, in the days following the 9/11 terrorist attacks, the Fed had rushed to flood the banks with liquid funds, adding $40 billion through Sept. 19, 2001. But the Fed's post-Lehman flood of money has been nearly 81 times larger.

Fact #4. After the Y2K and 9/11 crises had passed, the Fed promptly reversed its money infusions and sopped up the extra liquidity from the banking system.

But in the six-plus years since the Lehman Brothers collapse, the Fed has done nothing of the kind ...

Yet!

And it's this three-letter word that contains the secret to our entire future — not only for the United States, but for the entire global economy.

As you can see from the chart, the Fed reversed its Y2K and 9/11 money pumping episodes quickly and completely. But it has not yet begun to reverse its history-smashing money-printing binge of the past seven years.

This raises major, heretofore unanswered
questions for all investors in all asset classes ...

When the Fed does raise rates, how will it impact the psychology and strategies of investors, businesses and consumers?

What will happen as the Fed begins to reverse the massive money-printing of recent years?

Which sectors and markets are the most vulnerable?

For the answer to the last question, the first place to look will be in all those sectors that have gotten the biggest influx of super-cheap money since 2008 ... and are bound to suffer the most from any outflows. They include ...

  • Speculative bubbles in major world commodities, most of which have already burst.
     
  • Speculative bubbles in BRIC countries, three largest of which — Brazil, Russia and China — have also already burst.
     
  • And next, speculative bubbles in small caps, junk bonds and other debts that are only now beginning to show initial signs of strain.

We will tell you more about these — and how to get out of their way — in the weeks ahead.

In the meantime, be sure to keep your investment portfolio as safe as possible, with plenty of cash and a moderate dose of hedging.

Good luck and God bless!

Martin


The investment strategy and opinions expressed in this article are those of the author's and do not necessarily reflect those of any other editor at Weiss Research or the company as a whole.

Have comments? Tell Us!

Facebook Twitter Linkedin YouTube Pinterest

About Money and Markets
For more information and archived issues, visit moneyandmarkets.com
Money and Markets is a free daily investment newsletter published by Weiss Research, Inc. This publication does not provide individual, customized investment or trading advice. All information is based upon data whose accuracy is deemed reliable, but not guaranteed. Performance returns cited are derived from our best estimates, but hypothetical as we do not track actual prices of customer purchases and sales. We cannot guarantee the accuracy of third party advertisements or sponsors, and these ads do not necessarily express the viewpoints of Money and Markets or its editors. For more information, see our Terms and Conditions. View our Privacy Policy. Would you like to unsubscribe from our mailing list? To make sure you don't miss our urgent updates, just follow these simple steps to add Weiss Research to your address book.

Attention editors and publishers! Money and Markets teaser content may be republished with a link to the full story on MoneyandMarkets.com. Such republication must include attribution with a link to the MoneyandMarkets home page as follows: "Source: moneyandmarkets.com"

Money and Markets: A Division of Weiss Research, Inc. |
4400 Northcorp Parkway | Palm Beach Gardens, FL 33410 | 1-800-393-0189


---------------------------

All titles, content, publisher names, trademarks, artwork, and associated imagery are trademarks and/or copyright material of their respective owners. All rights reserved. The Spam Archive website contains material for general information purposes only. It has been written for the purpose of providing information and historical reference containing in the main instances of business or commercial spam.

Many of the messages in Spamdex's archive contain forged headers in one form or another. The fact that an email claims to have come from one email address or another does not mean it actually originated at that address! Please use spamdex responsibly.


Yes YOU! Get INVOLVED - Send in your spam and report offenders

Create a rule in outlook or simply forward the junk email you receive to questions@spamdex.co.uk | See contributors

Google + Spam 2010- 2017 Spamdex - The Spam Archive for the internet. unsolicited electric messages (spam) archived for posterity. Link to us and help promote Spamdex as a means of forcing Spammers to re-think the amount of spam they send us.

The Spam Archive - Chronicling spam emails into readable web records index for all time

Please contact us with any comments or questions at questions@spamdex.co.uk. Spam Archive is a non-profit library of thousands of spam email messages sent to a single email address. A number of far-sighted people have been saving all their spam and have put it online. This is a valuable resource for anyone writing Bayesian filters. The Spam Archive is building a digital library of Internet spam. Your use of the Archive is subject to the Archive's Terms of Use. All emails viewed are copyright of the respected companies or corporations.

Our inspiration is the "Internet Archive" USA. "Libraries exist to preserve society's cultural artefacts and to provide access to them. If libraries are to continue to foster education and scholarship in this era of digital technology, it's essential for them to extend those functions into the digital world." This is our library of unsolicited emails from around the world. See https://archive.org. Spamdex is in no way associated though. Supporters and members of http://spam.abuse.net Helping rid the internet of spam, one email at a time. Working with Inernet Aware to improve user knowlegde on keeping safe online. Many thanks to all our supporters including Vanilla Circus for providing SEO advice and other content syndication help | Link to us | Terms | Privacy | Cookies | Complaints | Copyright | Spam emails / ICO | Spam images | Sitemap | All hosting and cloud migration by Cloudworks

Important: Users take note, this is Spamdex - The Spam Archive for the internet. Some of the pages indexed could contain offensive language or contain fraudulent offers. If an offer looks too good to be true it probably is! Please tread, carefully, all of the links should be fine. Clicking I agree means you agree to our terms and conditions. We cannot be held responsible etc etc.

The Spam Archive - Chronicling spam emails into readable web records

The Glass House | London | SW19 8AE |
Spamdex is a digital archive of unsolicited electronic mail 4.9 out of 5 based on reviews
Spamdex - The Spam Archive Located in London, SW19 8AE. Phone: 080000 0514541.