Rick Santelli Strikes Again
By Barry Ritholtz - September 3rd, 2008, 5:30AM
Interesting discussion of credit, liquidity and commodity corrections.
Steve Liesman missed the opportunity to tell Santelli that the Fed Futures traders got rates wrong for over a year — from January 2006 until the Fed began cutting in August 2007, futures traders incorrectly were betting on cuts:
Tags: http://bigpicture.typepad.com/comments/2007/10/fed-fund
September 3rd, 2008 at 7:58 am
True, yet Santelli would still kick Liesman’s butt in trading. I enjoy wathcing those two go at it!
September 3rd, 2008 at 10:11 am
This is exactly to Santelli’s point, by emphasizing that his traders do not believe that the Fed will do anything at least until March. The trades are on because that’s where the money is, hence the forward curve implies a rate increase. Derivatives like options attached to this contracts ( although I do not know if this is the case) should give a better picture of where interest rates are going.
Liesman is a typical academic who sees his and the Fed’s economic theories vindicated and therfore lifts Bernanke at all into economic heaven. He confuses short term luck with long term knowledge.
September 3rd, 2008 at 10:25 am
Liesman probably should give up economics and go into something with a better track record, say, meteorology.
September 3rd, 2008 at 10:27 am
Liesman looks too much like Mary Tyler Moore’s boss to be taken seriously…
Seriously…
Bruce in Tennessee
September 3rd, 2008 at 10:28 am
Santelli is great
September 3rd, 2008 at 10:47 am
Santelli and select guests are among the few reasons I ever turn the volume up on CNBC-Bubblevision. Kudlow and Caruso-Cabrera are the Republican cheer squad and Dennis Kneale is the most errant and erratic voice in the history of CNBC. Liesman is fine at repeating the doctored stats pouring out of the Gov these days but is worthless at critically evaluating them. Perhaps CNBC should buy Steve a subscription to Shadowstats.com…that might help.
September 3rd, 2008 at 2:45 pm
santelli is real also gasparino is pretty real………….
September 3rd, 2008 at 3:19 pm
Brilliant – especially the textbook v trading stuff at the end.
The only man on TV worth listening to.
September 3rd, 2008 at 3:26 pm
“Steve Liesman missed the opportunity to tell Santelli that the Fed Futures traders got rates wrong for over a year — from January 2006 until the Fed began cutting in August 2007, futures traders incorrectly were betting on cuts”
On the contrary, Steve knows better. Its not that futures traders had it wrong, its that the Fed was late, behind the curve. A similar case back in 1993, Greenspan was still lowering interest rates till fed funds hit 3% in Oct 93. Futures traders had it right then too. They were already raising interest rates then and didn’t stop throughout 1994. The fed didn’t see the light till Feb 2004 and they continued raising interest rates seven times in 2004. This isn’t the first time this has happened and it won’t be the last.
September 3rd, 2008 at 4:10 pm
I could have this wrong – but didn’t Steve say “Why don’t they hit the bid?” Um, its futures, should be taking offers in futures for lower rates. I wonder how those guys get along off the air!
September 3rd, 2008 at 5:37 pm
CNBC is missing the fact that while oil prices have fallen 30% in the last few weeks, gas prices have only fallen 10%. Cost at the pump is what effects discretionary spending the most.
September 3rd, 2008 at 5:48 pm
Anyone else hear the rumor that Gawhar may be in decline?
September 3rd, 2008 at 8:26 pm
Does anyone have Santelli’s clip from today about the Fed needing to raise rates? I only caught part of it at the office.
September 3rd, 2008 at 10:10 pm
the only 2 folks worth listening to on CNBC are santelli and Art Cashin. The rest is uninformed drivel.
September 4th, 2008 at 1:05 am
Santelli is great, Liesman is a typical follower with no idea why he sees issues one sided and tends to be wrong.Steve should run for pres. and fit right in.
September 4th, 2008 at 8:19 am
steve has a major in journalism. He is not an economist.
September 4th, 2008 at 2:27 pm
The management @ CNBC need to put Santelli on more often, or give him his own show.
September 5th, 2008 at 11:43 am
I guess this is as close as I can get to emailing Rick Santelli. So…
Rick! Your comment about the fed simply printing more money to pay bills was so right on. Please read the 250 words below:
Inflation Creates Poor People.
Inflation is not prices going up. That is a result of greater demand or short supply.
Inflation is the dollar becoming worth less, because the government is printing more of them. Obviously, if the dollar is worth less, all prices will rise – but not because of market forces.
FDR took us off the gold standard and began printing fiat money in an attempt to get the country out of the Great Depression. This was supposed to be a temporary answer, not permanent, so don’t blame FDR.
But as it happens, we’ve had fiat currency and the resulting inflation ever since. Do I think we need to go back on a gold standard? Not necessarily, but we need a currency that has a net zero inflation because inflation slowly, silently, insidiously, creates more poor people as their buying power melts away. Today’s dollar is worth about four cents.
This is a problem everyone should be concerned about because it adversely affects the poor and elderly.
The fact is that only the federal government benefits from inflation.
Everyone else suffers, especially the poor and those on fixed incomes. Inflation creates poor people and the Fed can put a stop to it any time it wants to.
Inflation should not “be under control.” That just means the less fortunate are being screwed more slowly. Inflation should be non-existent.
We had no inflation for 120 years and can have it again.
Please think about this – it should be an issue.
Inflation creates poor people.
- Grimgold