The salient point to remember at this time is -- that the primary trend of the market was last confirmed, under Dow Theory, as bearish. This fact is working against the Fed's frantic efforts at increasing employment. The Fed's mandate is to keep the dollar strong and to do what it can to promote "full employment." But what is full employment? Based on past studies, I put "full employment" at around 5.5%.
Actually, since we're in a bear market, I doubt whether the Fed can achieve this measure -- even with "QE to infinity."
It is estimated that the Fed is pumping roughly $80 billion a month into the US economy. This will amount to around one trillion dollars a year. The Fed's balance sheet is off the charts, and I conclude that "QE to infinity" will be considered both insane and unsustainable.
Below, the Dow is falling off its six-session ledge ... Log in or subscribe to continue reading.
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