Tuesday, June 27, 2017

Janet Yellen in a London speech

Asset valuations are somewhat rich if you use some traditional metrics like price earnings ratios, but I wouldn’t try to comment on appropriate valuations, and those ratios ought to depend on long-term interest rates,” she said.

Responding to a question on financial system stability, Yellen said post-crisis regulations (and $2.5 trillion in excess reserves which just happen to be fungible and give the banks the impression that they are safe) had made financial institutions much “safer and sounder.”
"Will I say there will never, ever be another financial crisis? No, probably that would be going too far. But I do think we’re much safer and I hope that it will not be in our lifetimes and I don’t believe it will."
Be honest. Tell the truth. Look in the mirror.  Don't lie. 
Could there be anyone less qualified for the job?



Monday, June 26, 2017

The Epoch Times asks why the FED hiked rates last week..........

The Epoch Times: Why did the Federal Reserve (Fed) hike rates last week, and what will its policy look like in the future?
James Rickards responds: They’re trying to prepare for the next recession. They’re not predicting a recession, they never do, but they know a recession will come sooner rather than later. This expansion is 96 months old. It’s one of the longest expansions in U.S. history. It’s also the weakest expansion in U.S. history. A lot of people say, “What expansion? Feels like a depression to me.”
I think it is a depression defined as depressed growth, but we’re not in a technical recession and haven’t been since June 2009. So it’s been an eight-year expansion at this point, but it won’t fare well, and the Fed knows that. When the U.S. economy goes into recession, you have to cut interest rates about 3 percent to get the United States out of that recession.
Well, how do you cut interest rates by 3 percent when you’re only at 1 percent? The answer is, you can’t. You’ve got to get them up to 3 percent to cut them back down, maybe to zero, to get out of the next recession. So that explains why the Fed is raising interest rates. That’s the fourth rate hike getting them up to 1 percent. They would like to keep going; they would like to get them up to 3, 3.5 percent by 2019.
My estimate is that they’re not going to get there. The recession will come first. In fact, they will probably cause the recession that they’re preparing to cure. So let’s just say we get interest rates to 1 percent and now you go into recession. We can cut them back down to zero. Well, now what do you do? You do a new round of quantitative easing (QE).
The problem is that the Fed’s balance sheet is so bloated at $4.5 trillion. How much more can you do—$5 trillion, $5.5 trillion, $6 trillion—before you cause a loss of confidence in the dollar?
There are a lot of smart people who think that there’s no limit on how much money you can print. “Just print money. What’s the problem?” I disagree. I think there’s an invisible boundary. The Fed won’t talk about it. No one knows what it is. But you don’t want to find out the hard way.

Sunday, June 25, 2017

Gerald O'Driscoll, former Dallas FED VP

Lest we forget with Italian banks falling faster than Billy Clinton headed after an intern and now as common as John McCain trying to stir up some more MIC spending in a rathole in the Middle East, the words of the esteemed FED policy maker come to mind, "the FED is working through the ECB, bailing out European banks and, indirectly,  spendthrift European governments."  Through the swap agreements with the European Central Bank Driscoll pointed out, " (that) foster the moral hazards and distortions that government credit allocation entails."

No truer words were ever spoken.   The American taxpayer once again, used as a tool!

Yellen continues Bernanke's willful ignorance.  The folly will be exposed but it will be hard to stomach.



  

Savor Life, Cultivate Optimism

Are you breathing? Are you eating well? Did you sleep enough last night? Did you exercise? Did you avoid the people who put you down or stress you out? Did you come up with ideas? Did you laugh? Are you grateful for what you have? Can you surrender to the universe, to the angels that anchor you to your fears, just for a moment, and say, “Who today do you want me to help?”

The Dumbest Person in the World

How dumb?  Very dumb.
It’s the American who knocks what he’s got.
He’s got a country of unbounded beauty.
Almost unlimited beauty.  Almost unlimited natural resources.
A judicial system that is the envy of the world.
Food so plentiful overeating is a major problem
A press nobody can dominate.
A ballot box nobody can stuff.
Churches of your choice.
One hundred million jobs.
Freedom to go anywhere you want with the planes, trains and cars to get you there.
Unemployment insurance.  Public schools and plentiful scholarships.
Opportunity to become a millionaire.
Okay, complainer, what’s your second choice?

Please GO!

Saturday, June 24, 2017

FED Listen UP!

For all FED employees here is the link!
http://economicprism.com/an-open-letter-to-william-dudley/
Dear Mr. Dudley,
Your recent remarks in the wake of last week’s FOMC statement were notably unhelpful.
In particular, your excuses for further rate hikes to prevent crashing unemployment and rising inflation stunk of rotten eggs.

Crashing Unemployment

Quite frankly, crashing unemployment is a construct that’s new to popular economic discourse, and a suspect one at that.
Years ago, prior to the nirvana of globalization, the potential for wage inflation stemming from full employment was the going concern.  Now that the official unemployment rate’s just 4.3 percent, and wages are still down in the dumps, it appears the Fed has fabricated a new bugaboo to rally around.  What to make of it?
For starters, the Fed’s unconventional monetary policy has successfully pushed the financial order completely out of the economy’s orbit.  The once impossible is now commonplace.
For example, the absurdity of negative interest rates was unfathomable until very recently. But that was before years of central bank asset purchases made this a reality.
Perhaps, the imminent danger of crashing unemployment will give way to the impossibility of negative unemployment.  Crazy things can happen, you know, especially considering the design limitations of the Bureau of Labor Statistics’ birth-death model.
Secondly, muddying up the Fed’s message with inane nonsense like crashing unemployment severely diminishes the Fed’s goal of providing transparent communication.  In short, Fed communication has regressed from backassward to assbackward.
During the halcyon days of Alan Greenspan’s Goldilocks economy, for instance, the Fed regularly used jawboning as a tactic to manage inflation expectations.  Through smiling teeth Greenspan would talk out of the side of his neck.  He’d jawbone down inflation expectations while cutting rates.
Certainly, a lot has changed over the years.  So, too, the Fed seems to have reversed its jawboning tactic.  By all accounts, including your Monday remarks, the Fed is now jawboning up inflation expectations while raising rates.

Congratulations and Thank You!

History will prove this policy tactic to be a complete fiasco.  But at least the Fed is consistent in one respect.  The Fed has a consistent record of getting everything dead wrong.
If you recall, on January 10, 2008, a full month after the onset of the Great Recession, Fed Chair Ben Bernanke stated that “The Federal Reserve is not currently forecasting a recession.”  Granted, a recession is generally identified by two successive quarters of declining GDP; so, you don’t technically know you’re in a recession until after it is underway.  But, come on, what good is a forecast if it can’t discern a recession when you’re in the midst of one?
Bernanke’s quote ranks up there in sheer idiocy with Irving Fisher’s public declaration in October 1929, on the eve of the 1929 stock market crash and onset of the Great Depression, that “Stock prices have reached what looks like a permanently high plateau.”  By the month’s end the stock market had crashed and crashed again, never to return to its prior highs in Fisher’s lifetime.
To be fair, Fisher wasn’t a Fed man.  However, he was a dyed-in-the-wool central planner cut from the same cloth.  Moreover, it is bloopers like these from the supposed experts like Bernanke and Fisher that make life so amiably pleasurable.  Do you agree?
Hence, Mr. Dudley, words of congratulations are in order!  Because on Monday you added what’ll most definitely be a sidesplitting quote to the annals of economic banter:
“I’m actually very confident that even though the expansion is relatively long in the tooth, we still have quite a long way to go.  This is actually a pretty good place to be.” – William Dudley, June 19, 2017
Thank you, sir, for your shrewd insights.  They’ll offer up countless laughs through the many dreary years ahead.

Too Little, Too Late

When it comes down to it, your excuses for raising rates are not about some unfounded fear of a crashing unemployment rate.  Nor are they about controlling price inflation.  These are mere cover for past mistakes.
The esteemed James Rickards, in an article titled The Fed’s Road Ahead, recently boiled present Fed policy down to its very core:
“Now we’re at a very delicate point, because the Fed missed the opportunity to raise rates five years ago.  They’re trying to play catch-up, and yesterday’s [June 14] was the third rate hike in six months.

“Economic research shows that in a recession, they [the Fed] have to cut interest rates 300 basis points or more, or 3 percent, to lift the economy out of recession.  I’m not saying we are in a recession now, although we’re probably close.

“But if a recession arrives a few months or even a year from now, how is the Fed going to cut rates 3 percent if they’re only at 1.25 percent?

“The answer is, they can’t.

“So the Fed’s desperately trying to raise interest rates up to 300 basis points, or 3 percent, before the next recession, so they have room to start cutting again.  In other words, they are raising rates so they can cut them.”
Unfortunately, Mr. Dudley, the Fed miscalculated.  Efforts to now raise rates will be too little, too late.  To be clear, there ain’t a snowball’s chance in hell the Fed will get the federal funds rate up to 3 percent before the next recession.  You likely won’t even get it up to 2 percent.
Nonetheless, you should stay the course.  If you’re gonna raise rates, then raise rates.  Don’t cut them.  Raise them.  Then raise them some more.
Crash stocks.  Crash bonds.  Crash real estate.  Crush asset prices.  Purge the debt and speculative excesses from financial markets.
Let marginal businesses go broke.  Let too big to fail banks, fail.  You can even consult with Dick “The Gorilla” Fuld, if needed.  Then let nature do its work.
In essence, bring the paper money experiment to a close and shutter the doors of the Federal Reserve.  No doubt, the economy and millions of people will suffer a painful multi-decade restructuring.  But what choice is there, really?
Let’s face it.  The Fed can’t hold the financial order together much longer anyway.  Why pretend you can with utter nonsense like crashing unemployment?  It’s insulting.
Your credibility’s shot.  Better to get on with it now, before it’s forced upon you.
P.S.  What’s up with Neel Kashkari?  The man has gone rogue.

Ghost Ranch Turkey 2017


Non-resident MONTANA hunters foot the bill to keep the coffers full for the Montana Fish, Wildlife & Parks Department.

These great friends of mine paid  big money for the opportunity to shoot Merriams in Montana.  Can you tell my friends thought it was worth every penny?  #GhostRanchGobblers  #WhoCaresIt's$NotHealth  #Can'tImagineMoreFun   #BoomBaby    #nonGMOFreeRangeAntibioticFreeTurkeyTastesBetter

The Goldman Sachs FED Recession Causation

"The most frequent contributors to modern recessions have been monetary policy tightening and oil price shocks, with the former in response to inflation that often gained momentum from the latter."

Native American Advisors CHIPPEWA PARTNERS

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CHIPPEWA PARTNERS, Native American Advisors, Inc. is a Registered Investment Advisor, founded by Dean Thomas Parisian in 1995. The firm is a manager to an exclusive clientele and is closed to new clients. As a Registered Investment Advisor, our expertise developed over 35 years balances experience, integrity and tremendous work ethic. Dean Parisian is a member at the White Earth Reservation of the Minnesota Chippewa Tribe, a former NYSE and FINRA arbitrator and trader who began his career with Kidder Peabody and later worked for Drexel Burnham Lambert in LaJolla, CA. His philanthropic interest is in Native American education and he's endowed a significant scholarship for Native Americans at the University of Minnesota. His greatest accomplishment includes raising two sons and 26 years of marriage. The Parisian family enjoys outdoor pursuits at Pamelot, their farm in Tennessee and at the Ghost Ranch, their ranch on the Yellowstone River in Montana. For media requests contact the firm via email: ChippewaPartners (at) gmail dot com, on Twitter: @DeanParisian. Global 404-202-8173