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New & Improved! Operation Twist - Coming soon from the Fed

CNBC Reports: The Fed in the week ahead is widely expected to pull the trigger on a new easing program, as the European debt crisis continues to boil...Market expectations are high that the Fed will announce a new program — dubbed "operation twist" — at the end of its two-day meeting Wednesday.

All the gory details at - CNBC.com

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SteveMT's picture

Operation Twist....ing in the wind.

Is Bernanke going to bring the crack or not? (source: fireant)

CNN News: "Twist and Shout Should Be the Fed’s Next Maneuver."

Twist and Shout Should Be the Fed’s Next Maneuver

1961. Did you know the 1961 "Twist" Fed program was lauched at a time Chubby Checkers had a #1 hit single?

Did you know even Uncle Ben commented on its failure?

2011. Now, the Fed steals bases. Nary a hit on the music charts. The Fed twist's again? The return of the twist from Jekyll Island lagoon?

When will Uncle Ben's cohorts comment on its failure?

2061. Fed? What Fed? I don't see a Fed.

Disclaimer: Mark Twain (1835-1910-To be continued) is unlicensed. His river pilot's license went delinquent in 1862. Caution advised. Daily Paul

They've already got the knife stabbed in everyones' backs

Now it's time to twist, twist, twist until the hurting stops.

Warn't no knife. Just paper cuts. Quadrillions of them.

Why create debt out of thin air? Wasn't the debt already created out of thin air bad enough?

Creating debt out of thin air creates a revenue stream for those rapscillions collecting on their empty promises.

Please stop created a fleet of ships for their namesake, Queen Elizabeth. QE I & II traveled the world in luxury. QE III? QE IV? QE V? QE VI? QE VII? Paper boats! They will soon sink. What will the Queen do then?

"Legal Tender" ~ "Legal Fiction"

Disclaimer: Mark Twain (1835-1910-To be continued) is unlicensed. His river pilot's license went delinquent in 1862. Caution advised. Daily Paul

But I thought

all these European socialist....er.. I mean *civilized* countries were the apex of what we should dream to be as Americans, and all that jazz. At least, that's what the Democrats have tried to sell to us for years.

Now we are being slammed with debt to bail their crumbling socialist utopias out.
While some moron in the White House demands that the way to prosperity is more debt and more taxes and bigger gov't.

I think some wayward stork dropped me off on the wrong planet.

Fed Supreme Mandate

All payments are to be postponed until a later date.

Insanity defense: The insane may continue paying debt w/ debt...

... And even more debt...

Each Fed Reserve note creates debt equal to its face value. It is put on our taxpayer tab... The National Debt.

End the Fed: Loaning you blind, since 1913.

Disclaimer: Mark Twain (1835-1910-To be continued) is unlicensed. His river pilot's license went delinquent in 1862. Caution advised. Daily Paul

Again the Fed obfuscates the truth and creates distractions...

More than a couple weeks ago the Fed was ALREADY handing out FRN's to their friends! Consider the following from the EU news, and notice the key words. All the comments are from the same listed articles, as contradictory as they seem:

1. Debt Concerns Spur Demand
September 16, 2011, 2:52 PM EDT
More From Businessweek ...

By Debarati Roy and Nicholas Larkin

Sept. 16 (Bloomberg) -- Gold rose the most in a week on renewed concern that Europe’s debt crisis will threaten economies, boosting demand for a haven.

European finance ministers ruled out efforts to prop up the faltering economy and gave no indication of providing aid for lenders at a meeting today. Gold has jumped 28 percent this year, reaching a record $1,923.70 an ounce on Sept. 6, on mounting signs the global economy will slow.

“People realize that the background problems have not disappeared, and the crisis in Europe has not been resolved,” William O’Neill, a partner at Logic Advisors in Upper Saddle River, New Jersey, said in a telephone interview.

... Yesterday, the European Central Bank said it will coordinate with other central banks to ensure euro-area lenders have enough dollars...

“They’re only really geared to put out spot fires and play brinkmanship, rather than to deliver a killer package that will actually resolve all their issues,” Tom Price, an analyst at UBS AG, said by telephone from Sydney. “In that environment, the problem drags on for years, not months, and it’s a great environment for gold.”

Eighteen months of crisis-fighting and 256 billion euros ($352 billion) in aid for Greece, Ireland and Portugal have failed to stabilize markets as the turmoil spread to Italy and Spain.

‘Orderly Default’

“They are moving to facilitate an orderly default for Greece, and then rallying around the remaining countries and banking system,” James Dailey, who manages $215 million at TEAM Financial Management LLC in Harrisburg...

Then we have:

"U.S. stocks rise as ECB, central banks move
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By Kate Gibson
NEW YORK (MarketWatch) -- U.S. stocks opened strongly higher on Thursday, extending gains into a fourth day, after the European Central Bank said it was coordinating with the Federal Reserve and other central banks. ...

"Treasurys fall most in three weeks on ECB lending
‘Dismal’ economic data gets shrugged off
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By Deborah Levine, MarketWatch
NEW YORK (MarketWatch) — Treasury prices fell on Thursday, ...after the European Central Bank said it would lend more dollars to European banks.

The move increased confidence among investors that the euro zone is making progress toward dealing with its sovereign-debt problems. [!?!]

“This alleviates some of the flight to a safe harbor in the U.S. Treasury market,” said Kathy Jones, fixed-income strategist at Schwab.

... The European Central Bank announced new, longer-term, dollar loans to European banks in coordination with the U.S., British, Japanese and Swiss central banks. ...

“It’s a coordinated central bank effort, which is really reassuring to people that this isn’t just the U.S. providing liquidity,” Jones said. “It’s really good in terms of boosting confidence, but it doesn’t address how they’re going to solve the solvency issues” for the countries struggling with massive debt loads.[?!?]

!! ... The liquidity operations may be good in the short run, but the “bad ending” to Europe’s situation, said Kevin Giddis, fixed-income analyst at Morgan Keegan.

“There is no one solution nor one event that will alter what is likely to be a very long road to recovery,” he said. “A road that is so ‘full’ of potholes that distinguishing it as a ‘road’ is very difficult.”

... Treasurys briefly pared losses after bond-friendly U.S. economic data: first-time claims for unemployment benefits rose more than seen in the latest week, consumer prices jumped in August, and a reading on manufacturing in the New York area unexpectedly weakened. Read about jobless claims. See more on retail-level inflation.

[!!] ... Analysts will look at the data through the lens of the Federal Reserve and how the news might affect officials’ inclination to ease monetary policy further.

“As long as the unemployment numbers are dismal, like they are in today’s claims, the Fed is going to remain accommodative,” Jones said. “We’re still looking at slow growth, low yields and the Fed to remain accommodative.” [!?!]

Investors see a slim possibility of the Fed buying more bonds in a third round of quantitative easing. It’s more likely they announce at next week’s policy something like an intention to extend the maturity of their portfolio. Read about Fed maybe buying longer-dated debt.

“The morning reports should make the Fed increasingly nervous because the data are not moving their way and we all know whatever options they still have are likely to prove ineffectual,” said Eric Green, chief market economist at TD Securities. “What the data this morning does reinforce is that QE is and should remain a non-starter.”...
And then:

"Treasuries Tumble as ECB Coordination With Fed Damps Bid for Safest Assets"
By Susanne Walker - Sep 15, 2011 2:19 PM PT

Sept. 15 (Bloomberg) -- Michael Schumacher, head of global rates strategy at UBS AG, discusses the European Central Bank's move to coordinate with the Federal Reserve to lend dollars to euro-area banks in a series of three-month loans. ...

...the European Central Bank said it will work with the Federal Reserve and other central banks to lend euro-area financial institutions dollars...

Thirty-year bonds erased gains posted yesterday after the Treasury sold $13 billion of the securities at the lowest yields on record as investors bet the Fed will announce plans to buy more longer-maturity debt next week....

... “That helped to fuel the fire and a lot of selling. It takes away some of the flight to quality.”

... U.S. debt securities have rallied in 2011 as speculation Europe’s sovereign-debt crisis will cripple the region’s financial institutions and evidence of a stalled U.S. economic recovery spurred demand for the safest assets.

... Central Banks

The ECB said that in coordination with the Fed, the Bank of England, the Bank of Japan and the Swiss National Bank it will conduct three U.S. dollar liquidity-providing operations with a maturity of about three months.

... “This buys some time, but there’s still underlying issues that have to be addressed,” Cloherty said. “This is a very different situation than in 2008 after the Reserve fund broke the buck, which caused a massive liquidity problem everywhere. This is more a capital than a liquidity problem. We will still need to see significant government intervention to address the underlying issues.”

... Swaps Markets

The premium European banks pay to borrow in dollars through the swaps markets decreased after the ECB said it will lend euro-area banks dollars to ensure they have enough of the U.S. currency through year-end.

... Basis swaps allow banks to borrow in one currency, while simultaneously lending in another.



ECB load up on gold [Where do you think the funds come from???]

European central banks have become net buyers of gold for the first time in more than two decades, the latest sign of how the turbulence in the currency and debt markets has revolutionized the bullion market.

... The switch from large selling to buying has helped propel the gold price more than 25 percent higher so far this year, hitting a nominal record of $1,920 a troy ounce this month. The shift in Europe comes as central banks in emerging markets are also loading up on gold.

Mexico, Russia, South Korea and Thailand have all made large purchases this year, in a move to reduce their exposure to the dollar. Globally, central banks are set to buy more gold this year than at any time since the collapse of the Bretton Woods system 40 years ago – the last time the value of the dollar was linked to gold.

“We’re going back to a time when gold is seen very much as money,” Jonathan Spall, director of precious metals sales at Barclays Capital, told FT.com in a video interview. “It has been a complete reversal of the attitudes we saw during the 1990s.”

The big lies continue... and the people believe them!

$16 Trillion Fed bailouts to any banks, foreign or domestic?

Daily Paul: The Fed Audit list of loans: "U.S. provided a whopping $16 trillion in secret loans to bail out US and foreign banks"

$16 Trillion Fed bailouts to any banks, foreign or domestic?
Submitted by Mark Twain 07/23/2011

    Talk of audit is an exaggeration. The main substance here is a $16 Trillion loan list. The list was a result of an act of Congress to uncloak the Federal Reserve secrecy. Federal Reserve's reluctant release of this list clearly identifies $16 Trillion in liar loans. They are liars. In some cases the very persons approving the loans received them for their companies. ...

    An astonishment! $16 Trillion bailout any banks, foreign or domestic! Could have paid off the make-believe National Debt, with a trillion or so left of to splurge on ice cream, cake... But I digress.

Disclaimer: Mark Twain (1835-1910-To be continued) is unlicensed. His river pilot's license went delinquent in 1862. Caution advised. Daily Paul

hahaha, oh my god. so funny,

hahaha, oh my god. so funny, but not so funny.


Per the poorly written article...

"Twist" is different than the much larger scale "QE2" quantitative easing program which involved the purchase of $600 billion in Treasury securities. Fed watchers expect this program to raise the duration of the securities the Fed holds, not the amount. The program, in theory, could reduce long-term interest rates as the Fed buys more securities in the middle and longer end of the yield curve.


1. Mid to long term treasury securities means T-notes and T-bonds respectively...right?

2. And a T-note/bond is a way for the gov to borrow money. So when the Fed buys T-bonds from the US gov, the Fed is actually lending money to the US gov. Right?

3. So the "twist" is that the Fed is still loaning us money, but the term is longer...reducing the interest rate.

That's like the difference of buying a house at 30 year loan instead of a 15 year loan. The 30 year loan has a lower interest rate...and a lower monthly payment. BUT you end up paying a LOT more in interest! Right?

4. Does anyone know how much, for how long, at what rate? Maybe that is what we find out this week.

5. Why the hell is this Fed Reserve news instead of US government getting in more debt news?

6. Why the hell does it seem that the Fed Reserve is setting the terms on US T-notes/bonds?

7. Why do I ask these questions knowing that the answers will only aggravate me?

reedr3v's picture

Some informed comments follow

the CNBC article. I felt better after reading through some; lots of people are not duped.

the only winner in a currency

the only winner in a currency war is gold and silver.

You can buy gold and silver all you want

I am buying cows and chickens. The value of your gold and silver will go up as well as the value of my cows and chickens. The only difference is my cows and chicken can make more cows and chickens as the value goes up. Also what I invest in people can eat. What is a shinny gold coin worth if you are starving compared to a chicken? I am not bashing gold and silver but people need to get real and invest in food first.

How you going to buy

How you going to buy the Cow and Chicken feed so they can breed to have more cows and chicken. If you are planning to trade them for feed then you wont have any cows and chicken left to feed. (the chicken and the egg theory). LOL

Do your best have no expectations

Very wise indeed. I'm also

Very wise indeed. I'm also getting ready to purchase my first chicken and rabbits for meat and I'm going to stock up on seeds and a years supply of food stock.

That should give me a jump start. Get prepared especially if Dr.Paul doesn't make it in.

Patriot Cell #345,168
I don't respond to emails or pm's.
Those who make peaceful revolution impossible will make violent revolution, inevitable.

So...what will you accept as

So...what will you accept as payment for these cows and chickens? Gold or silver most likely. How does the value of cows and chickens go up when there are more and more of them reproducing? I would much rather invest is something that everyone wants than something that everyone would have. I agree that being self reliant and self sufficient is the best way to go. Make your own food, don't rely on others.

Everyone wants food and as we

Everyone wants food and as we get further into the mess.. people will want that because there will be less of it. Reports of shortages around the globe are already being seen.

So for payment what would I accept? If things don't change, the last thing we'll be worried about is how to sell anything.. it will be a day to day question of what will we eat tomorrow.

Wait for it.

Patriot Cell #345,168
I don't respond to emails or pm's.
Those who make peaceful revolution impossible will make violent revolution, inevitable.

Joη's picture

"What a twist!"

Was M. Night added to the board?

*adds no substance to conversation*

"You underestimate the character of man." | "So be off now, and set about it." | Up for a game?

First the roller coaster ride on the stock market,

To shake out the loose change.

The a ride on the Twister, which works the wringing of a dishrag to squeeze out the last drops of wealth.

Structural change from a 'borrow and spend' to a 'coin and carry' economy requires savings of sound money (not fiat).

Free includes debt-free!

Crash the world to save it....

( for ourselves and make it in our image-- statists)

"Hence, naturally enough, my symbol for Hell is something like the bureaucracy of a police state or the office of a thoroughly nasty business concern." ~~C.S. Lewis
Love won! Deliverance from Tyranny is on the way! Col. 2:13-15