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1
Frostbite Falls Newz / Re: Frostbite Falls Newz Links
« Last post by Surly1 on Today at 08:41:54 AM »
Quote
https://un-denial.com/2017/01/06/you-know-you-are-in-trouble-when/comment-page-1/#comment-1041

You know you are in trouble when…

At first glance, really a good site. Very promising.
2
Surly Newz / The Future Sucks
« Last post by Surly1 on Today at 08:31:32 AM »
The Future Sucks

The Future Sucks

The Old Guys™ discuss the biggest letdowns of our adult lives.

Getty
OCT 20, 2017
114

The future sucks. By the future we mean the present, of course, because the data isn’t in yet on tomorrow or 10 years from now. (If we make it that far.) But considering things from the perspective of our younger selves, the future-present, it’s pretty safe to say, is not how any of us envisioned it.

When we thought about the future back then it all seemed so much more transportation-based in terms of hypothetical advances, right? Spaceships and hover-skateboards. Instead, we got dating apps where nobody ever meets and a Nazi reunion tour. What happened? Esquire's resident Old Guys™ discuss.


Luke:

None of us anticipated any of the current signifiers of technological progress we take for granted now, like the depression computer in our pocket. Where did you think we’d be by now Dave? Living on the moon?

Dave:

I for sure thought space travel would be a thing by now, or that at the very least, contact with beings from other planets. And honestly, I had no idea that I would want to leave Earth’s atmosphere as much as I currently do.

The thing from The Jetsons that I always found most fascinating was communication via view-screen. I grew up in a time of landlines and Kodak cameras, so the idea of communicating via video was enticing. And now we have that! We have the ability to communicate via text or video with just about anyone anywhere in the world! And we’re using it to yell at each other. Technology is way more advanced, but people are still dicks.

Also, I guess, food pills.

Luke:

That just triggered a very vivid memory for me, of standing in front of my parents’ wall-mounted rotary phone, probably calling a girlfriend, and longing for the Jetsonsvideo phone to be real. It seemed like such a futuristic thing; I never imagined it would be possible. I still don’t even understand how old-timey phones work, so the fact that we can do this now is a miracle that I totally take for granted. By the way, it seems like that whole thing, FaceTime and so on, really just sort of arrived one day without much fanfare, and we all played it super chill. There should have been an international day of observance.

I am completely disinterested in space travel to the point of annoyance at any efforts to make it a reality. It will never happen in our lifetime, and whenever I see Elon Musk or whoever dumping tens of millions of dollars into testing rockets, I’m like, motherfucker, I can’t afford to go to the dentist. This shit should not be anyone’s priority in terms of spending at the moment. People are living in poverty, can we put the brakes on the underground train or whatever it is now?

"WHENEVER I SEE ELON MUSK OR WHOEVER DUMPING TENS OF MILLIONS OF DOLLARS INTO TESTING ROCKETS, I’M LIKE, MOTHERFUCKER." —LUKE

I am sort of skeptical about technological advances that do actually seem to be coming soon too. I do not believe driverless cars will ever be a thing. It will simply require too much of a cultural shift, and a complete rewriting of the ways we travel and think about travel, to ever be feasible on a large scale. Have you been in one yet?

Dave:

I have not, and the only reason I cannot picture it is that I don’t know where I’d focus my rage. When I’m in a Lyft and the driver is pokey or aggressive or trying to make an ambitious left, I silently seethe at them. But if it’s just a machine, I suppose I would have to turn my anger inward, which, you know, I have experience with.

Luke:

What about clothing? I feel like that’s another area—well-trod by comedians of course—that old-timey futurist stuff really got wrong. We pictured a future of sleek jumpsuits and instead we got cargo shorts and XXXL t-shirts.

Dave:

I think the last technological clothing advance was Hypercolor, the shirts that would change color in your torso’s hottest spots. So for like three months in 1991, everyone was walking around with blue shirts that went purple around the armpit and underboob areas. After that, we kinda just kept our apparel analog.

I also for sure did not think I’d be worried about some genius maniac 3-D printing a machine gun, but here we are. Didn’t you think we’d be past world hunger by now?

Luke:

I don’t believe in 3-D printers either. Don’t ask me to expand on that. I am sort of surprised Hypercolor didn’t come back in the whole normcore thing a few years ago. Big time wasted nostalgia marketing opportunity if we’re being honest.

I don’t remember what I thought about world hunger back then. It seems like, if anything, technology as it applies to the production of food has taken us backwards in terms of health, considering factory farming "advances" and GMOs and such. That sort of futurism is probably going to lead to our undoing rather than saving us. I did expect a cure for cancer by now.

One of the factors that is probably holding a lot of things back is that we have so many of our Tech Brain Geniuses spending all their time inventing phone apps and rediscovering services and products that already exist, like buses, and hotels, and vending machines, instead of working on the damn cancer-curing flying car. Does that sort of thing piss you off?

Dave:

I mean, yeah, but then I pull out my phone and numb myself with those sweet, sweet apps.

What I do find annoying is this: A product like Soylent comes along, and it’s immediately marketed to like, people who don’t have time for lunch. Finally, a product for the person who takes no pleasure from eating! And nobody, as far as I know, is figuring out a way to get a balanced-meal-in-a-bottle to people who are literally starving to death. I know it’s not a lucrative market, but you’d think we could get a box of that shit down to Puerto Rico or something, instead of into the hands of some wealthy tech bro who doesn’t like tastes.

"I ALSO FOR SURE DID NOT THINK I’D BE WORRIED ABOUT SOME GENIUS MANIAC 3-D PRINTING A MACHINE GUN, BUT HERE WE ARE." —DAVE

Again, the bug in the system is us. You know how when you make a goal for your future, you imagine that when that thing happens, it will happen to a better, sharper, future version of you? Like: I will get that job, and when I get that job, I will be a different, more disciplined me. And then you get that job, and you’re still just the crummy old you. I think that’s what we’ve done with our advances in tech: We are at our imagined future, where we can share and communicate and bring this world together for once, but we’re still just us, so we’re spending our day looking for Pokémon and blowjobs.

Luke:

If you told past me about the brave new future of Pokémon and blowjobs, I probably would have imagined it being a lot cooler than it actually turned out to be.

Dave:

I don’t know, I just made this GIF of Mick Jagger, so maybe we’re going to be okay.

Giphy
3
Economics / Re: Da Fed: Central Banking According to RE
« Last post by moniker on Today at 08:26:19 AM »
To begin with, I do not believe any financial numbers reported by the fed or the govt. Whatever they say they are gonna do is rubbish as well.

We are being subjected to deliberate misinformation and contradictions to make us feel powerless.

We are in the endgame now.
4
Geopolitics / Spain Will Remove Catalan Leader, Prime Minister Announces
« Last post by RE on Today at 08:04:09 AM »
Democracy?  We don't NEED no Stinkin' Democracy!

<a href="http://www.youtube.com/v/VqomZQMZQCQ" target="_blank" class="new_win">http://www.youtube.com/v/VqomZQMZQCQ</a>

It will be interesting to see how this plays out.  Will Carlos just let himself be arrested and become a Martyr?  Will the Catalan Gestapo obey the Diktats ordered from Madrid?  How many people will go out on the street and how violent will they get?

RE

https://www.nytimes.com/2017/10/21/world/europe/spain-catalonia-mariano-rajoy.html

Europe
Spain Will Remove Catalan Leader, Prime Minister Announces

By RAPHAEL MINDEROCT. 21, 2017


Prime Minister Mariano Rajoy of Spain announced that fresh regional elections would take place in Catalonia within six months. Credit Gabriel Bouys/Agence France-Presse — Getty Images

MADRID — In a first for Spain, Prime Minister Mariano Rajoy announced on Saturday that he would remove the separatist government of the independence-minded region of Catalonia and initiate a process of direct rule from Madrid.

The announcement, made after an emergency cabinet meeting, was an unexpectedly forceful attempt to stop a yearslong drive for secession in Catalonia, which staged a highly controversial independence referendum on Oct. 1, even after it was declared illegal by the Spanish government and courts.

Mr. Rajoy took the bold steps with broad support from Spain’s main political opposition, and will almost certainly receive the required approval next week from the Spanish Senate, where his own conservative party holds a majority.

But the moves were immediately condemned by Catalan leaders and thrust Spain into uncharted waters, as the prime minister tried to put down the gravest constitutional crisis his country has faced since embracing democracy after the death of its dictator Gen. Francisco Franco in 1975.

It would be the first time that the central government in Madrid has stripped the autonomy of one of its 17 regions, and the first time that a leader has invoked Article 155 of the Spanish Constitution — a broad tool intended to protect the “general interests” of the nation.
Continue reading the main story
Related Coverage

    Article 155: The ‘Nuclear Option’ That Could Let Spain Seize Catalonia OCT. 20, 2017
    Barcelona: A Global City in the Eye of a Separatist Storm OCT. 20, 2017

Mr. Rajoy said the Catalan government had never offered real dialogue with the central government in Madrid but had instead tried to impose its secessionist project on Catalan citizens and the rest of the country in violation of Spain’s Constitution.

He said his government was putting an end to “a unilateral process, contrary to the law and searching for confrontation” because “no government of any democratic country can accept that the law be violated, ignored and changed.”

Mr. Rajoy said he planned to remove the Catalan leader, Carles Puigdemont, and the rest of his separatist administration from office.

The central government was also poised to take charge of Catalonia’s autonomous police force.

Mr. Rajoy did not ask to dissolve the Catalan Parliament, but instead said that the president of the assembly would not be allowed to take any initiative judged to be contrary to Spain’s constitution for a period of 30 days, including trying to propose another leader to replace Mr. Puigdemont.

Mr. Rajoy said that his goal was to arrange new Catalan elections within six months, so as to lift the measures taken under Article 155 as soon as possible.

However, it’s unclear how such elections would be organized or whether they would significantly change Catalonia’s political landscape, let alone help to resolve the territorial conflict.

In fact, the steps announced by Mr. Rajoy run a serious risk of further inflaming an already volatile atmosphere in Catalonia, where tens of thousands braved Spanish national police wielding truncheons to vote for independence during the barred Oct. 1 referendum.

Mr. Puigdemont was expected to lead a mass demonstration in Barcelona, the region’s capital, on Saturday afternoon, before giving his official response to Mr. Rajoy’s decision.
Protests in Barcelona on Saturday Video by La Vanguardia

Several Catalan separatist politicians, however, reacted immediately to Mr. Rajoy’s announcement, warning that it would escalate rather than resolve the conflict.

Josep Lluís Cleries, a Catalan senator, told reporters on Saturday that Mr. Rajoy’s decision showed that “the Spain of today is not democratic because what he has said is a return to the year 1975,” referring to Franco’s death. Mr. Rajoy, he added, was suspending not autonomy in Catalonia but democracy.

Oriol Junqueras, the region’s deputy leader, said in a tweet that it was “facing totalitarianism” and called on citizens to join the Barcelona protest on Saturday.

Significantly, Ińigo Urkullu, the leader of the Basque region, which also has a long history of separatism, described the measures as “disproportionate and extreme,” writing on Twitter that they would “dynamite the bridges” to any dialogue.

Faced with Madrid’s decision to remove him from office, Mr. Puigdemont could try to pre-empt Mr. Rajoy’s intervention and instead ask Catalan lawmakers to vote on a declaration of independence in coming days — as he had threatened to do earlier this month.

Mr. Puigdemont could also then try to convene Catalan elections, on his own terms, to form what he could describe as the first Parliament of a new Catalan republic.
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Should Mr. Puigdemont resist Mr. Rajoy’s plans, Spain’s judiciary could separately step in more forcefully and order that he and other separatists be arrested on charges sedition or ultimately even rebellion for declaring independence.

Rebellion carries a maximum prison sentence of 30 years. Earlier this week, a judge from Spain’s national court ordered prison without bail for two separatist leaders, pending a sedition trial.

Using Article 155 “was neither our desire nor our intention,” Mr. Rajoy said on Saturday, but had become the only way to to return Catalonia to legality, normality and maintain a Spanish economic recovery “which is now under clear danger because of the capricious and unilateral decisions” of the Catalan separatist government.

Mr. Rajoy highlighted the decision of over 1,000 Catalan companies this month to relocate their legal headquarters outside the region, in response to the uncertainty generated by the possibility of breakup/break up with Madrid.

Mr. Rajoy received strong backing from politicians from the main opposition parties, with the notable exception of Podemos, the far-left party that wants to use a referendum to convince Catalan voters to remain within Spain.

“We’re shocked by the suspension of democracy in Catalonia,” Pablo Echenique, a senior official from Podemos, said in a televised news conference on Saturday, after Mr. Rajoy’s announcement.
5
Knarfs Knewz / Re: Time for a walk about
« Last post by RE on Today at 06:05:16 AM »
The world's people have become so divided with their opinions they believe them to be real. I practice the middle way, and I find VERY few news articles that I can agree with. Maybe that will change in my life time, but I doubt it. So, until I "Grok" a reason to keep posting the crap that always serves some agenda, i will be making music, and continuing to practice "Mind empty, heart open, body dancing."

Have a nice vacation.  I wish I had such a luxury.

RE
6
Knarfs Knewz / Time for a walk about
« Last post by knarf on Today at 06:02:17 AM »
The world's people have become so divided with their opinions they believe them to be real. I practice the middle way, and I find VERY few news articles that I can agree with. Maybe that will change in my life time, but I doubt it. So, until I "Grok" a reason to keep posting the crap that always serves some agenda, i will be making music, and continuing to practice "Mind empty, heart open, body dancing."
7
OK, it's all perfectly clear now...  ::)

RE

http://www.businessinsider.com/ap-questions-and-answers-on-proposed-ban-on-laptops-in-luggage-2017-10

Can you pack laptops in your luggage? Your questions answered on the government's proposed laptop ban
Associated Press

    Joan Lowy, Associated Press


A traveler takes her laptop out of her bag for scanning at JFK airport in New York City on May 17, 2017. Joe Penney/Reuters

    The Trump administration banned laptops in the cabins of some planes because of security risks.
    Now, the Federal Aviation Administration is looking at banning them in checked luggage because of their potential to start fires.
    Here's what's going on, and what could happen next.

WASHINGTON (AP) — First the U.S. government temporarily banned laptops in the cabins of some airplanes. Now it is looking to ban them from checked luggage on international flights, citing the risk of potentially catastrophic fires.

The Federal Aviation Administration recently recommended that the U.N. agency that sets global aviation standards prohibit passengers from putting laptops and other large personal electronic devices in their checked bags.

The FAA says in a filing with the International Civil Aviation Organization that the lithium-ion batteries in laptops can overheat and create fires.

Some questions and answers about the shifting U.S. policy.
Why is the FAA worried about this danger now?


A U.S. Customs and Border Protection officer watches over travelers at Los Angeles International Airport on July 2, 2016 in Los Angeles, California. David McNew/Getty Images

The FAA has long been concerned about the potential hazardous of lithium batteries. The agency's tests of the risks of shipping large quantities of batteries as cargo on airliners showed that when a single battery overheats, it can cause other nearby batteries to overheat as well. That can result in intense fires and the release of explosive gases.

Based on those test results, the FAA was able to convince ICAO two years ago to ban cargo shipments of lithium batteries on passenger planes and to require that batteries shipped on cargo planes be charged no more than 30 percent. The risk of overheating is lower if the battery isn't fully charged.

More recently, the FAA conducted 10 tests of fully charged laptops packed in suitcases. In one test, an 8-ounce aerosol can of dry shampoo —which is permitted in checked baggage — was strapped to the laptop. A heater was placed against the laptop's battery to force it into "thermal runaway," a condition in which the battery's temperature continually rises. There was a fire almost immediately and an explosion within 40 seconds with enough force to potentially disable the fire suppression system.

Other tests of laptop batteries packed in suitcases with goods like nail polish remover, hand sanitizer and rubbing alcohol also resulted in large fires, although no explosions.
Isn't the government contradicting itself?


Flight Passengers use their laptops on a flight out of John F. Kennedy (JFK) International Airport in New York, U.S., May 26, 2017. REUTERS/Lucas Jackson

The different messages are the result of two agencies with different missions: security versus safety.

Last March, the Department of Homeland Security imposed a ban on laptops in the cabins of planes coming into the U.S. from 10 Middle Eastern airports to prevent them from being used as a tool in an attack. Many passengers put their laptops in their checked bags instead. The ban was fully lifted in July after airports in the region took steps to improve security.

This ban is being sought by the FAA, which is focused on the risk of an accidental explosion more than the prospect of a terrorist attack.
When will I have to stop packing my laptop?


FILE PHOTO - A TSA worker loads suitcases at the checked luggage security screening station at Los Angeles International Airport in Los Angeles, California, U.S. on September 7, 2011. REUTERS/Jonathan

There are no guarantees that there will be ban on packing laptops in checked bags.

The FAA is presenting its case at a meeting this week and next of ICAO's dangerous goods panel. European aviation safety regulators, aircraft manufacturers and pilots' unions have endorsed the proposal.

Even if the panel were to agree with the proposal, it would still need to be adopted at higher levels of ICAO. And it would only apply to international flights.
What about domestic flights?

This is unclear. Individual countries can decide whether to implement domestic bans. The United States has not indicated if it will do so.

The effect of such a ban may not be great, since many passengers don't check bags to avoid surcharges, and those that do often prefer to carry on electronics.
Will the US keep pushing for the international ban?


FILE PHOTO: A Delta Airlines jet takes off from Washington National Airport in Washington, U.S., August 9, 2017. REUTERS/Joshua Roberts/File Photo

This is also unclear. The FAA, which favors the ban, is handling negotiations for the U.S. at the ICAO meeting. But, for future meetings, Transportation Secretary Elaine Chao is having another agency, the Pipeline and Hazardous Materials Safety Administration, take the lead.

It's not clear if that agency, known as PHMSA, will share the FAA's position.

PHMSA previously led dangerous goods negotiations, but the Obama administration put the FAA in charge after congressional Democrats complained that PHMSA officials were too cozy with the industries they regulated.

The Transportation Department said in a statement that PHMSA "has a unique and highly effective" approach to regulating the transportation of hazardous materials, and that it will consider what impact any change in aviation rules might have on transportation. The statement also said PHMSA will collaborate with the FAA.
8
Knarfs Knewz / Purple People Eaters
« Last post by knarf on Today at 05:48:27 AM »
“There are two kinds of people in the world, those who believe there are two kinds of people in the world and those who don’t.”

— Robert Benchley

I have this one relative who has very different political and social views from me. We have heated debates on Facebook. My friends sometimes have heated debates with him on Facebook. We disagree. I don’t understand his thinking.

That’s my uncle.

And I have this one relative who took care of my grandmother. He took care of my dad when I couldn’t be here. He loves my kids. He’s kind and funny, and wise in ways I’m not.

That’s also my uncle — the same uncle.

He’s complicated. He’s interesting. He, like the rest of us, is more than what he posts on social media or how he voted in the last election. He, like the rest of us, doesn’t fit into any one category.

My uncle and I disagree whole-heartedly and we love each other whole-heartedly, because we can do both of those things at the same time.

There’s a lot of money to be made and power to be had by convincing the American people that we fit into two categories; those of us who are right, and the rest of you morons (or, those of us who are left, and the rest of you morons).

The powers that be benefit when we believe we are better Americans than the other half of Americans.

Russia is one of those “powers that be.” During our election they fed us propaganda that stoked our fears of “us versus them;” red versus blue, immigrants versus Americans, Muslims versus Christians, good versus evil.

Russia even attempted to divide and conquer the Democratic party (with pretty decent success I think) with propaganda that pitted Bernie against Hillary.

But Russia didn’t come up with the notion of dividing us on their own. News outlets like MSNBC and FOX increase their viewership by increasing our distrust of “the other side” and fortifying the idea of “our side” with hand-picked facts that confirm our beliefs.

And politicians, well, it behooves them to have us believe that our options are to feast with their team or famine with their opponents. They win elections by convincing us that we need to be saved from the “other side” and they are the only ones who can save us.

We’re being groomed to believe that we have to choose only one side and the other side is our enemy.

You’re either for us entirely or against us entirely.

You have to agree with every idea that a Democrat has (even if it’s crazy) and hate every idea that a Republican has (even if it’s reasonable).

You have to vote for every Republican candidate (even if one of them knocks out a reporter during a news conference) and against every Democrat.

You’re either a gun-crazed, NRA cheerleader or you want to abolish the second amendment.

You either hate America or you stand during the national anthem.

You’re either right or wrong. Smart or stupid. A snowflake or a racist.

Well … no. No.

You can be a million places in between two extremes. You can be complicated, and so can your uncle, and your friend, and your co-worker, and that stranger on Facebook.

You can not like what I’m saying and still like me.

You can believe that black lives matter and believe that blue lives matter.

You can defend my right to protest and disagree with the way I’m protesting.

You can admit that some parts of the Affordable Care Act are a mess and admit that some parts of it are a step in the right direction.

You can believe in our right to bear arms and believe that military style assault rifles should not be legal.

You can be a devout Christian and a relentless crusader for LGBT rights.

You can see a confederate flag as a symbol of southern pride and see how someone else might see it as a symbol of that time the South fought to keep slaves.

You can send thoughts and prayers and send a fax to your congressman.

You can talk and you can listen.

You can be the center of a Venn diagram and fit into two (or more) bubbles at once.

When I first moved back to Texas from California someone joked with me, “We’re a red state and with all these blue people moving in, I’m worried we might turn purple!”

Would that be so bad? I mean, aside from the immense power that a huge state like Texas would wield if it became a swing state, isn’t that what this country needs right now is less blue and red and more purple? If the truth really is somewhere in between, then let’s live in between.

We don’t have to agree on everything to agree on something. We can honor and believe in our own story AND honor and believe in someone else’s story that is very different than our own.

Be nuanced. Be complicated. Be purple.

http://www.corsicanadailysun.com/opinion/purple-people-eaters/article_201dce16-ae00-11e7-a5cd-07b111389d3f.html
9
Surly Newz / Doomstead Diner Daily 10/21
« Last post by Surly1 on Today at 04:35:02 AM »


Doomstead Diner Daily 10/21

News digest brought to you by the Doomstead Diner.

  • Saturday, Oct. 21, 2017
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Editor's note

The Doomstead Diner is a hub for discussion and information pertaining to the ongoing Economic Collapse of the Industrial Economy. The Diner is the result of many years of discussion and debate on many other forums.
At Doomstead Diner, our goal is to collate much of the information we can to assist in planning for the world to come.
10
Economics / Is the Fed Getting Cold Feet about the QE Unwind?
« Last post by RE on Today at 02:02:43 AM »
https://wolfstreet.com/2017/10/20/is-the-fed-getting-cold-feet-about-the-qe-unwind/

Is the Fed Getting Cold Feet about the QE Unwind?
by Wolf Richter • Oct 20, 2017 • 75 Comments   


Curious things are happening on its balance sheet.

The last Fed meeting ended on September 20 with a momentous announcement, confirming what had been telegraphed for months: the QE unwind would begin October 1.

The unwind would proceed at the pace announced at its June 14 meeting. It would shrink the Fed’s balance sheet – “balance sheet normalization” it calls that – and undo what serial bouts of QE have done: gradually destroying some of the money that had been created out of nothing during QE.

The pace of the shrinkage would be $10 billion a month for the first three months, and then it would accelerate every three months until it hits $50 billion a month at this time next year. That was the announcement.
Reality Check

Thursday afternoon, the Fed released its weekly balance sheet for the week ending October 18. We’re now two and half weeks and three weekly balance-sheet releases into the QE unwind period. How much has the Fed actually reduced its balances sheet?

    Total assets on Oct 4:  $4.460 trillion
    Total assets on Oct 11: $4.459 trillion
    Total assets on Oct 18: $4.470 trillion

You read correctly: Since October 4, the balance sheet gained $10 billion, all of it in the week ending October 18.

The Fed is supposed to unload $10 billion in October. But curiously, so far, it has done the opposite. This chart shows the balance sheet movements so far this year. Note the jump in the last week:

The chart below shows the Fed’s total assets over the entire QE period from before the Financial Crisis through the currently missing QE unwind. There was a mini-unwind after QE-1 and that was about it:

As part of the $10 billion that the Fed said it would shrink its balance sheet in October, it is supposed to unload $6 billion in Treasury securities and $4 billion in mortgage backed securities. How did that go so far?

Since October 4, the Fed has in fact added $176 million in Treasury securities and now holds $2,465.6 billion of Treasury securities of all maturities, a new all-time record high, and there is no sign of any unwind:

And even crasser: Since October 4, the Fed has piled on $9.8 billion in mortgage-backed securities, and there is no sign of any unwind either:

In fact, looking at the Fed’s Open Market Operations (OMO), the Fed’s “Trading Desk,” as it calls this entity, was very busy nearly every day in the MBS market, buying between $400 million to over $2 billion of MBS per day.



The Fed has done this since the end of QE in order to keep the MBS on its balance sheet about even. MBS securities constantly forward principal payments to their holders (as underlying mortgages get paid down or off), and unlike regular bonds, they shrink until they’re redeemed at maturity. To keep the MBS balance steady, the Fed has to constantly buy MBS. So this just continues its routine.

But clearly, there is no sign that the Fed has backed off from its purchasing activity – which leaves several possible conclusions:

    The whole QE-unwind announcement was a hoax to test how stupid everyone is. But I doubt this.
    The people running the OMO are on vacation and have been replaced by algos or interns, and they just keep doing what the folks now on vacation have been doing for years. I doubt this too.
    The FOMC told the public what it wants to have done but forgot to tell its own people at the Trading Desk. I doubt that too.
    There is willfulness in it – a sign that they’re not ready, or that they want to give the markets more time to get used to the idea of it, etc. And this could be the case.
    They’re seeing something that worries them, and they’re holding off for now to get a clearer picture. But I doubt this because their decision to commence the QE-unwind on October 1 was unanimous, and since then nothing of enough enormity has changed.

Whatever the reason, the announced “balance sheet normalization” is not taking place. The opposite is taking place.

By contrast, when QE was started in late 2008, the Fed kicked it off with an explosive vengeance. The folks at the Trading Desk didn’t dillydally around. In the 10 weeks between September 3, 2008 and November 12, 2008, they purchased $1.3 trillion of securities, ballooning the balance sheet by 144%.

Sure, some people may say that a few weeks are not enough time to judge the Fed on its QE unwind. But this is not something we’re going to ignore. And so far, the Fed is doing the opposite of what it said it would do.

Pricing of risk kicks the bucket in record central-bank absurdity. Read…  This is What it Looks Like When Credit Markets Go Nuts
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