Markets barreling on to new all time highs in the face of sequestration, unemployment rates not seen since the 1980's, shrinking household median incomes, GDP below 2%, rising food and energy prices, etc, etc. I must admit that I grossly underestimated the power of Ben wielding his liquidity sword. I guess that I will have to break out my party hat, plug my nose and make my way to the punch bowl (Not that folks like myself are allowed anywhere near the punch bowl).
The Bernank Put! He even put a bid under treasury market. Said he'd hold to maturity the bonds which the Fed is buying! Means traders don't have any momentum to trade on! Trading is all about momentum of what's predictable! That's why so many seek to trade based on insider trading to gain an edge! Nobody or hedge fund, etc, could trade successfully 98% for a whole year, only the house bookie!
The Federal reserve is really nothing more than a bank itself. For the TV cameras QE was an effort to boost the economy and lower unemployment. The real reason was to shore up bank balance sheets by transferring risky assets to tax payers and create a trading environment where they can't lose money. Mr. and Mrs. Smith gets their rewards at the gas pump and the grocery store. Anyone that believes inflation is subdued must be living in a bubble.