Americans are devoted to free market capitalism unsullied by the tyrannical hand of government. At least in theory. In reality once corruption or extreme business cycles expose Malthusian limitations of economic wealth we immediately cry out for government assistance. In American history perhaps only the Great Depression laid this paradox more bare than the financial crisis of 2008.

No matter what you hear to the contrary greed didn't create the housing bubble. People are always greedy and anyone suggesting otherwise is selling you something. What unleashed the worst of our greedy instincts was a series of horrifically ill-conceived regulations crafted by buffoons on both sides of the political aisle. Through the power of misguided regulations elected officials created a system that violated the basic laws of economics. The result was a systemic promotion of our most base greed instincts at the expense of collective common sense.

Related: 3 Myths of the Financial Crisis

What's fascinating is that our collective response to the meltdown has been to cede basic liberties to the same group of elected officials in an effort protect us from letting a similar crisis from happen again. Predictably, the politicians are using the opportunity to wrest even more power from Main Street.

"At the time of the crisis, two-thirds of all the risky loans in the system were either owned by government entities or entities operating under government control," says Jay Richards, author of the book Infiltrated: How to Stop the Insiders and Activists Who Are Exploiting the Financial Crisis to Control Our Lives and Our Fortunes. Richards says this came to be through the efforts of Senator Chris Dodd and Rep. Barney Frank and others now pushed ill-conceived affordable housing laws on the false premise that owing money on a home was a key element of the American Dream. Naturally, the reform bill to fix the problem is being crafted by the very same politicians.

Markets were thrown into chaos yesterday when the Federal Reserve announced it would not be reducing its controversial quantitative easing program in the immediate future. After trading flat ahead of the Fed's statement the Dow Jones Industrial Average (^DJI) closed up 147 points at a record 15,677. The S&P500 (^GSPC) also closed at a record high at 1,725.5.

Related: No Taper! Dovish Bernanke Fuels Dow, S&P to Record Highs

The S&P 500 is now up 18% in 2013 after rallying more over 4% in less than two weeks.

The prospect of more money printing triggered a flight to safety as yields on 10-year Treasury (^TXN) notes dropped to 2.7% and gold rallied a stunning 4.5% to $1,366.50.

With markets around the world rallying this morning traders are left wondering exactly what on earth happened and how they could have been so poorly positioned going into the news.

The Decision Not to Begin Tapering QE Shouldn't Have Come as a Huge Surprise

The January FOMC statement stated very specifically that the Fed was targeting an unemployment rate below 6.5% and would do whatever it deemed necessary to achieve that goal provided “inflation between one and two years ahead is projected to be no more than a half a percentage point above the Committee’s 2% longer-run goal.”

Unemployment remains well over 7%, a figure Bernanke himself beliefs understates the real rate. The Fed's official Economic Projections regarding inflation have a "Central Tendency" range of 1.7 - 2% for 2016. The most hawkish of the the Federal Reserve Bank Presidents are now looking for inflation of 2.3% in 2016.