{"id":30770,"date":"2018-02-09T17:22:37","date_gmt":"2018-02-09T22:22:37","guid":{"rendered":"http:\/\/olduvai.ca\/?p=30770"},"modified":"2018-02-09T17:22:37","modified_gmt":"2018-02-09T22:22:37","slug":"central-bank-musical-chairs","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=30770","title":{"rendered":"Central Bank Musical Chairs"},"content":{"rendered":"
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Central Bank Musical Chairs<\/a><\/h3>\n<\/div>\n
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If the last few stock market days are interrupting your sleep, Jim Bianco and CNBC\u2019s Rick Santelli<\/a> are saying, get used to it. \u00a0The total assets of all central banks hit $16.4 trillion plus (an all-time high) and these banks now, collectively, own 33 percent of all the world\u2019s sovereign bonds (someone\/something had to buy \u2018em).<\/p>\n

Santelli\u2019s question to Bianco was, if the aggregate size of the world\u2019s central banks is at an all-time high, and these bank\u2019s have purchased a third of all government paper, will these banks be able to \u201cnormalize in size\u201d (shrink) without \u201cgoing through a lot more stock market anguish?\u201d Bianco\u2019s response was a flat, \u201cno.\u201d<\/p>\n

Reversing trillions of dollars worth of securities purchases will create market turmoil. \u00a0And now that price inflation has entered the equation, the ride is bound to be bumpy. So, who should 401k investors be worried about and keeping an eye on? Bianco and Santelli agree, that person is ECB head man Mario Draghi. Santelli believes Draghi may be caught without a chair in this game of monetary musical chairs. By the way, it\u2019s not all about the Fed any more. \u201cAll central bank stimulus is fungible,\u201d says Bianco, \u201cit doesn\u2019t matter who does it.\u201d<\/p>\n

The patron saint of central bankers, John Maynard Keynes, wrote<\/a> in The General Theory,<\/p>\n

\u201cFor it is, so to speak, a game of Snap, of Old Maid, of Musical Chairs \u2014 a \u00a0pastime in which he is victor who says Snap neither too soon nor too late, who passed the \u00a0Old Maid to his neighbour before the game is over, who secures a chair for himself when \u00a0the music stops. These games can be played with zest and enjoyment, though all the <\/em>players know that it is the Old Maid which is circulating, or that when the music stops \u00a0some of the players will find themselves unseated.\u201d<\/em><\/p>\n

…click on the above link to read the rest of the article…<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Central Bank Musical Chairs If the last few stock market days are interrupting your sleep, Jim Bianco and CNBC\u2019s Rick Santelli are saying, get used to it. \u00a0The total assets of all central banks hit $16.4 trillion plus (an all-time high) and these banks now, collectively, own 33 percent of all the world\u2019s sovereign bonds […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[39,124,18450,18452,18451,458,4492,1138],"class_list":["post-30770","post","type-post","status-publish","format-standard","hentry","category-economics","tag-assets","tag-central-banks","tag-douginvegas-com","tag-general-theory","tag-jim-bianco","tag-john-maynard-keynes","tag-rick-santelli","tag-stock-market"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/30770","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=30770"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/30770\/revisions"}],"predecessor-version":[{"id":30771,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/30770\/revisions\/30771"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=30770"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=30770"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=30770"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}