Vikram Pandit may or may not know this but execs on the trading floor of Morgan Stanley used to call him “Trader Vik.” No, that wasn’t a compliment. Eventually Pandit delivered on his nickname’s promise by blowing up his hedge fund, Old Lane.
All that said, with today’s news from Ben Bernanke that American savers will continue to earn ZERO rate of return on their savings accounts while the US Government feeds the pig, now even Trader Vik can make money!
Today, the FOMC has decided to keep interest rates at ZERO for an “exceptional and extended” period of time. This politicization of the short end of the yield curve will continue to feed the Piggy Banker Spread (the spread that Vik’s government owned Citigroup gets to chow down on as they borrow short from the government and lend long to the citizenry).
If you don’t like the conflicts and the compromises associated with the smile on this man’s face, too bad. This is a Washington controlled America and, for now, we have to see this for what it is.
I have immediate term resistance for the pain trade in the SP500 up at 1162; immediate term support is now 1143.
Keith R. McCullough
Chief Executive Officer