Rick Santelli Strikes Again

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:

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  1. Joe Drake commented on Sep 3

    True, yet Santelli would still kick Liesman’s butt in trading. I enjoy wathcing those two go at it!

  2. Alfred commented on Sep 3

    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.

  3. Patrick McMurray commented on Sep 3

    Liesman probably should give up economics and go into something with a better track record, say, meteorology.

  4. Bruce commented on Sep 3

    Liesman looks too much like Mary Tyler Moore’s boss to be taken seriously…


    Bruce in Tennessee

  5. Quonk commented on Sep 3

    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.

  6. leftback commented on Sep 3

    Brilliant – especially the textbook v trading stuff at the end.

    The only man on TV worth listening to.

  7. Duude commented on Sep 3

    “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.

  8. Alex commented on Sep 3

    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!

  9. Pat G. commented on Sep 3

    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.

  10. Simon commented on Sep 3

    Anyone else hear the rumor that Gawhar may be in decline?

  11. Kevin commented on Sep 3

    Does anyone have Santelli’s clip from today about the Fed needing to raise rates? I only caught part of it at the office.

  12. slackful commented on Sep 3

    the only 2 folks worth listening to on CNBC are santelli and Art Cashin. The rest is uninformed drivel.

  13. chris hoey commented on Sep 4

    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.

  14. zack commented on Sep 4

    steve has a major in journalism. He is not an economist.

  15. Prime Rate commented on Sep 4

    The management @ CNBC need to put Santelli on more often, or give him his own show.

  16. Grimgold commented on Sep 5

    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

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