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The big question todayis not so much what the Federal Reserve will say or do but whether it will be enough to put an end to dollar’s misery

Posted by Aadil on April 27, 2011 at 1:37pm

 

With interest rates expected to remain unchanged for most of the year, the Federal Reserve’s decision centers around their asset purchase program and they have 3 obvious choices:

a)      End their Quantitative Easing program early

b)      Complete the QE program and reinvest funds from maturing payments

c)      Complete the QE program and terminate reinvestments                               

 

http://www.fx360.com/

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Too big to fail

Posted by Aadil on April 26, 2011 at 9:54pm
www.hbo.com/video/video.html/%3Fautoplay%3Dtrue%26vid%3D1175400%26filter%3Dall-movies%26view%3Dnull" /> www.hbo.com/video/video.html/%3Fautoplay%3Dtrue%26vid%3D1175400%26filter%3Dall-movies%26view%3Dnull" /> www.hbo.com/video/video.html/%3Fautoplay%3Dtrue%26vid%3D1175400%26filter%3Dall-movies%26view%3Dnull" type="application/x-shockwave-flash"> <div><a title="Trailer" href="http://www.hbo.com/video/video.html/?autoplay=true&vid=1175400&filter=all-movies&view=null">Trailer</a></div>
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Bernanke Rally, Can It Last? (NYSE:JJC) (NYSE:AGQ) (NYSE:IAU) (NYSE:UCO)

Posted by Aadil on April 26, 2011 at 9:09pm
Every trader that I know is talking about the FOMC meeting tomorrow. This is when the Federal Reserve Bank Chairman, Ben Bernanke, is scheduled to give his first ever press conference after an interest rate decision. The market this afternoon is betting that Helicopter Ben is going to keep the money pump flowing. As we all know the Fed's quantitative easing program (U.S. Treasury purchases) is due to end sometime in June 2011. Can the stock market stand on its own two feet without the constant cash reverses being created by the Fed on a daily basis? Chairman Bernanke is getting to live out his college thesis that states if the stock market goes up people will feel better and everything will be better. It sounds like Coue's rule, this is where you look in the mirror and say, “every day and in every way I am getting better and better.” Eventually, you are supposed to feel better. Meanwhile, as Chairman Bernanke gets to live out his college dream the U.S. Dollar Index seems to be declining into the abyss. 

What can Chairman Bernanke say about the U.S. Dollar Index? After all the U.S. Dollar Index has declined by nearly 17.0 percent since June 7, 2010. What will Chairman Bernanke say about the zero percent interest rate policy that he has put into place since December 2008 for the too big to fail banks. Has anyone looked at the interest rate on a savings account lately? We may as well put our cash under a mattress, outside of writing a check there is very little use for a bank these days. What are the retirees on fixed incomes going to say when they see prices increase on a daily basis as there money continues to buy less and less. Will Helicopter Ben address the high oil, gold silver, copper, and every other commodity prices? Perhaps, he will simply say that it is demand driven. 

The one question that I would ask Chairman Bernanke would be, if we are a free market society then why are the Fed funds rate set by the Federal Reserve and not set by the market place? How does the Fed or anyone else know what is best for the free markets. Then I would ask him if we really live in a free market society? How can the banks can still borrow money for nothing on a daily basis and charge an average of 17.0 percent on a credit card? What do these banks do with all of those cash reserves that are created everyday from QE-2?

Ah, tomorrow is going to be fun watching these questions get answered, if they are asked. As far as we know he may just take a page out of Alan Greenspan's book and simply mumble an answer that people could never understand. Greenspan was good at answering his own questions despite being asked something entirely different. This is going to be a must watch. In the trading community this press conference will get higher ratings than a Seinfeld reunion.
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One Firm Controls 50% of the NYSE volume, Bill Mclaren (45 year veteran ) Discusses the "Flash Crash"

Posted by L Levin on April 25, 2011 at 5:34pm
I've been in this business 45 years and what occurred on the 6th was criminal behavior. Tens of thousands of traders and investors had their positions stolen from them with their use of protective stops. This was a failure of the exchange to keep an orderly market -- that is their primary responsibility. It is not to facilitate program trading. But the rules of the exchange have been changed to facilitate program trading which now is the majority of trades on the exchange. In fact one firm controls 50% of the NYSE volume. These programs manipulate the markets for very short term profits and should never be allowed. It is now a week later and the exchange says they don't know why the 1000 point decline occurred. I don't believe it. There are two things that could cause that to occur, the first is it was orchestrated by a few members or it was a failure of the exchange "rules" governing program trading. Neither of which they would ever admit too. But their failure to keep an orderly market, while allowing program trading to dominate the market should have them legally responsible to all the investors who had their positions stolen from them especially if those positions were taken as principle by NYSE member firms. And on that happy note-have a great week end.   http://www.safehaven.com/article/16803/cnbc-squawkbox-europe-report
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