QE ends. So did it work?

[MadImmortalMan]

Fed announcement today is that tapering is ending on schedule.

The US seems to have the strongest economy in the world atm, and investors from Europe and Asia are clamoring to get into our market. I keep hearing that the US is viewed as the least bad place to put your money.

We had much less easing than Japan and more than Europe. So did the bond purchasing program work?

[CountDeMoney]

I keep hearing that the US is viewed as the least bad place to put your money.

Meanwhile, back at the gangsters' hideout corporate boardroom...

China best place to invest, say US execs
Oct 21 2014 09:07

Los Angeles - China is the best place to invest, according to a survey published Monday of US corporate executives.
In the survey by New York-based marketing firm Development Counsellors International, 30% of executives said China had the strongest foreign investment opportunities. Britain ranked second with 22%, and Germany came in third with 20%.
India was fourth and Brazil fifth.
By region, the executives preferred the Asia-Pacific, followed by Western Europe and Latin America, according to the survey.
The online survey asked 356 executives and location advisers what countries and regions they viewed as the top locations for international investment opportunities.
Executives involved in manufacturing selected the Asia-Pacific region for the greatest promise of growth, while decision-makers in the service sector saw Western Europe as the most promising region.

[mongers]

Damn MiM, that's a pretty disrespectful way announce the death of a monarch. 

[Barrister]

I keep hearing that the US is viewed as the least bad place to put your money.

Meanwhile, back at the gangsters' hideout corporate boardroom...

China best place to invest, say US execs
Oct 21 2014 09:07

Los Angeles - China is the best place to invest, according to a survey published Monday of US corporate executives.
In the survey by New York-based marketing firm Development Counsellors International, 30% of executives said China had the strongest foreign investment opportunities. Britain ranked second with 22%, and Germany came in third with 20%.
India was fourth and Brazil fifth.
By region, the executives preferred the Asia-Pacific, followed by Western Europe and Latin America, according to the survey.
The online survey asked 356 executives and location advisers what countries and regions they viewed as the top locations for international investment opportunities.
Executives involved in manufacturing selected the Asia-Pacific region for the greatest promise of growth, while decision-makers in the service sector saw Western Europe as the most promising region.

Umm, that's a ranking by US corporate execs, of the best foreign places to invest.  By definition, the US was excluded.

[CountDeMoney]

Umm, that's a ranking by US corporate execs, of the best foreign places to invest.  By definition, the US was excluded.

Hence the use of the word "meanwhile", to indicate a related development occurring at roughly the same time, both here and in space. 

Bitch.

[Baron von Schtinkenbutt]

Umm, that's a ranking by US corporate execs, of the best foreign places to invest.  By definition, the US was excluded.

Hence the use of the word "meanwhile", to indicate a related development occurring at roughly the same time, both here and in space. 

Bitch.

Since you posted it in response to the statement about the US being the "least bad" place to invest, you obviously intended to show US businesses don't want to invest in the US.  Thus, the counselor's objection is valid and sustained.

Bitchtits.

[Jacob]

Umm, that's a ranking by US corporate execs, of the best foreign places to invest.  By definition, the US was excluded.

Hence the use of the word "meanwhile", to indicate a related development occurring at roughly the same time, both here and in space. 

Bitch.

Since you posted it in response to the statement about the US being the "least bad" place to invest, you obviously intended to show US businesses don't want to invest in the US.  Thus, the counselor's objection is valid and sustained.

Bitchtits.

Whoa! Baron von Feisty on the scene!

Where did he come from?

[The Minsky Moment]

Very difficult to say because there is no proper control. 
It doesn't seem to have hurt and there is reason to believe it might have helped.  Theories as to how an why vary.

[Barrister]

Umm, that's a ranking by US corporate execs, of the best foreign places to invest.  By definition, the US was excluded.

Hence the use of the word "meanwhile", to indicate a related development occurring at roughly the same time, both here and in space. 

Bitch.

Since you posted it in response to the statement about the US being the "least bad" place to invest, you obviously intended to show US businesses don't want to invest in the US.  Thus, the counselor's objection is valid and sustained.

Bitchtits.

[Baron von Schtinkenbutt]

Whoa! Baron von Feisty on the scene!

Where did he come from?

I don't know.  I'm in a good mood today, after four straight days in the doldrums.

[CountDeMoney]

Since you posted it in response to the statement about the US being the "least bad" place to invest, you obviously intended to show US businesses don't want to invest in the US.  Thus, the counselor's objection is valid and sustained.

Bitchtits.

Fuck all you assholes anyway. 

[MadImmortalMan]

Is there a valid comparison to be drawn between the different easing policies of the US, Europe and Japan and the relative health of their respective economies, or is that something that can't really show anything meaningful?

[citizen k]

http://online.wsj.com/articles/former-fed-chief-greenspan-worried-about-future-of-monetary-policy-1414597627

Former Fed Chief Greenspan Worried About Future of Monetary Policy
Fed Chief From 1987 to 2006 Says Fed's Bond-Buying Program Fell Short of its Goals
By
Michael S. Derby


Former Federal Reserve Chairman Alan Greenspan said Wednesday that the Fed's bond-buying program, which aimed to lower unemployment and spur stronger economic growth, fell short of its goals.

Mr. Greenspan's comments to the Council on Foreign Relations came as Fed officials were meeting in Washington, D.C., and expected to announce within hours an end to the bond purchases.

He said the bond-buying program was ultimately a mixed bag. He said that the purchases of Treasury and mortgage-backed securities did help lift asset prices and lower borrowing costs. But it didn't do much for the real economy.

"Effective demand is dead in the water" and the effort to boost it via bond buying "has not worked," said Mr. Greenspan. Boosting asset prices, however, has been "a terrific success."

Mr. Greenspan, who ran the Fed from 1987 to 2006, was generally downbeat on the economy and the state of central bank policy around the world. Once lauded as the "The Maestro" for his stewardship of central bank policy, he has come in for criticism for his handling of monetary policy during the housing market bubble that burst and was followed by the most severe financial crisis and economic downturn since the Great Depression.

Asked whether he regrets not doing more with Fed policy to stop the financial-market bubbles that preceded the crisis, Mr. Greenspan said "no."

He observed that history shows central banks can only prick bubbles at great economic cost. "It's only by bringing the economy down can you burst the bubble," and that was a step he wasn't willing to take while helming the Fed, he said.

The Fed has held its benchmark short-term interest rate near zero since the crisis in an effort to spur economic activity. Many investors believe the central bank will start raising rates in the middle of next year, a view some top officials have encouraged.

The question of when officials should begin raising interest rates is "one of those questions I cannot answer," Mr. Greenspan said.

He also said, "I don't think it's possible" for the Fed to end its easy-money policies in a trouble-free manner.

"We've never had any experience with anything like this, so I'm not going to sit here and tell you exactly how it's going to come out," Mr. Greenspan said. But he noted that markets often react to changes in central bank policy unpredictably and not entirely rationally. Recent episodes in which Fed officials hinted at a shift toward higher interest rates have unleashed significant volatility in markets, so there is no reason to suspect that the actual process of boosting rates would be any different, Mr. Greenspan said.

He said the Fed may not even have that much power over the timing of interest-rate increases. The problem as he sees it is an interest rate the Fed pays on the money banks park at the central bank, called reserves. Fed officials plan to use this tool as their primary lever for raising interest rates when the time comes. If bankers decide to put this money to work, creating inflation risks, the Fed may be forced to raise rates, even if the economy isn't ready for it, he warned.

"I think that real pressure is going to occur not by the initiation by the Federal Reserve, but by the markets themselves," Mr. Greenspan he said.

Mr. Greenspan said gold is a good place to put money these days given its value as a currency outside of the policies conducted by governments.

He was also downbeat about Europe and said the only way the euro can survive over the long run is through full political integration of the 18-country area that shares the currency. Anything short of that will allow imbalances to fester and build, eventually leading to a collapse of the currency, he said.

[Baron von Schtinkenbutt]

Since you posted it in response to the statement about the US being the "least bad" place to invest, you obviously intended to show US businesses don't want to invest in the US.  Thus, the counselor's objection is valid and sustained.

Bitchtits.

Fuck all you assholes anyway.

[citizen k]

Very difficult to say because there is no proper control. 
It doesn't seem to have hurt and there is reason to believe it might have helped.  Theories as to how an why vary.

Aside from the S&P 500 of course, some may wonder: who was the biggest beneficiary of QE3? It certainly wasn't the US middle class, which has seen its real wages decline in 6 of the past 7 months, and its disposable income is back at levels not seen since the mid-1990s. No, the biggest winner of QE3 is the same entity that we noted benefited the most from QE over the past 6 years, and which even the WSJ realized was the primary beneficiary of the trillions in cash created out of thin air by the Fed, when in late September Hilsenrath wrote "Fed Rate Policies Aid Foreign Banks"...  something we first said back in 2011 with "Exclusive: The Fed's $600 Billion Stealth Bailout Of Foreign Banks Continues At The Expense Of The Domestic Economy, Or Explaining Where All The QE2 Money Went."

So when it comes to the Fed's QE3 generosity to foreign banks, what was the real number?

Here is the answer.

The first chart below shows that since starting in December 2012, when QE3 was formally launched, and continuing through today, the Fed injected some $1.3 trillion reserves with banks, which has manifested as extra cash held by various banks operating in the US, both domestic, but most importantly, foreign.



So how does this increase in bank cash assets look like when broken down by banking group? The answer is shown below:





And the bottom line:
   

• Small domestic banks, such as your mom and pop regional bank which is anything but Too Big To Fail: change in cash: zero.
• Large domestic banks, think JPM's CIO group, i.e., its London Whale division which used precisely this "excess" Fed cash to try to corner the IG market and blow up in the process: call it just under $600 billion in cash as a result of QE3.
• And the winner, with over $700 billion in extra cash added thanks to QE3, is: foreign (mostly insolvent European) banks.

So yes, European banks: feel free to send your thank you cards to the Fed: without its $1.3 trillion cash injection who knows how many of you would have passed the ECB's "no deflation to model" most recent Stress Test.

A word of warning: let's all hope that now, with some $1.5 trillion in Fed cash on foreign (most insolvent European) bank balance sheet, or just about half of all QE liquidity injections since the start of QE1, European banks are finally solvent. Or else, deflation, inflation, stagflation, hyperinflation, or what have you, the Fed will be storming right back in to bail out Europe's insolvent banks the US middle class all over again.

http://www.zerohedge.com/news/2014-10-29/and-biggest-beneficiary-qe3