The headline was innocuous, even a tad obvious. Yet when The Wall Street Journal reported Fed Likely to Keep Buying Bonds on Wednesday afternoon, it was a bombshell in certain circles. Fiscal cliff fears that had gripped the markets all week were suddenly less daunting, as traders relished the thought that, once again, the cavalry (a.k.a. Ben Bernanke and the Fed) would ride to the rescue with even more firepower at his disposal.
While this kind of reaction clearly falls within the realm of the don't fight the Fed axiom, for some investors it was also a not-so-subtle reminder that all is not well.
"As long as the Fed is providing liquidity, it's a sign that something is dysfunctional, something is wrong with the marketplace," says Charlie Smith, the chief investment officer at Fort Pitt Capital
http://finance.yahoo.com/blogs/breakout/don-t-fooled-fed-stimulus-sign-dysfunction-not-131844591.html?l=1
Realist - Everybody in America is soft, and hates conflict. The cure for this, both in politics and social life, is the same -- hardihood. Give them raw truth.
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