Posted on 11/04/2010 2:02:12 PM PDT by SeekAndFind
Inspired by the Fed’s $600 billion QE2 stimulus plan, the bulls flooded Wall Street with buy orders on Thursday as the S&P 500 joined its peers by soaring nearly 2% and clinching two-year highs.
Today’s Markets
The Dow Jones Industrial Average rose 219.71 points, or 1.96%, to 11434.84, the Standard & Poor's 500 gained 23.10 points, 1.93%, to 1221.06, the Nasdaq Composite soared 37.07 points, or 1.46%, to 2577.34. The FOX 50 added 14.22 points, or 1.65%, to 875.75.
Beginning overseas and in the currency and commodities markets, Thursday's buying binge came just a day after the Federal Reserve fired off a $600 billion stimulus cannon aimed at breathing life into the disappointing economic recovery.
“People are in a don’t fight the Fed mode. It’s driving people to equities,” said Nick Kalivas, vice president of financial research at MF Global. “I think it’s a combination of the commodity markets being very vibrant and people looking at the weak dollar and putting risk on.”
Commodity-related and economically-sensitive stocks like mining giant Rio Tinto (RTP: 62.21 ,0.00 ,0.00%) soared as the falling U.S. dollar sent crude oil jumping to April levels and gold to its biggest surge in 20 months.
By driving the closely-watched and broad-based S&P 500 to its highest close since September 19, 2008, the markets added to the bullish sentiment and confirmed the breakouts seen earlier this week for the Dow and the Nasdaq Composite. In another bullish sign, buying gained momentum late in the day, with all three major indexes closing at session highs.
“Barring any disaster between now and the end of the year, 12000 (on the Dow) is really a due,” Jason Weisberg, senior vice president at Seaport Securities, told FOX Business.
Wall Street clearly suffered no effects of a Fed Day hangover,
(Excerpt) Read more at foxbusiness.com ...
Dollar devalued.
Everything now costs more, including these stocks, even though they aren’t worth more.
If the dollar is being weakened did the market actually go up?
Sentiment is over-the-top bullish. Double top.
Must Watch: David Stockman Says The Fed Is Injecting High Grade Monetary Heroin Into The Financial System
Today’s absolutely must watch clip comes from David Stockman, director of the OMB under Ronald Reagan. “An independent Fed is what we had when I was in the government. Volcker was the head of it...Today the Fed is scared to death that the boys and girls and robots on Wall Street are going to have a hissy fit. And therefore these programs, one after another, are simply designed to somehow pacify the stock market, and hoping to keep the stock indexes going up, and that somehow that will fool the people into thinking they are wealthier and they will spend money. The people aren’t buying that. Main Street is not stupid enough to believe that engineered rallies as a result of QE2 stimulus are making them wealthier and so they should go out and buy another Coach bag. This is really crazy stuff that I can’t say enough negative about...The Fed is telling a lot of lies to the market... it is telling all the politicians on Capitol Hill you can issue unlimited debt cause it doesn’t cost anything. We have $9 trillion of marketable debt. Upwards of 70% of that has maturities of 5 years or less down to 90 days. All of those maturities are 1% down to 10 basis points. So from the point of view of Congress, the cost of carrying the debt is essentially free. When you tell politicians they can issue $100 billion of debt a month for free, how do you expect them to do the right thing, and ask their constituents to sacrifice... I think the Fed is injecting high grade monetary heroin into the financial system of the world, and one of these days it is going to kill the patient.”
That is one of the damn cutest, most appropriate pictures I have seen here in years! CHASING BUBBLES!!!
Well said! Do you have a picture showing her expression when the bubble pops?
Anybody who has any sense is putting their money into something that will keep pace or beat inflation. Savings accounts at 1% and Bonds at 3% aren’t going to do you much good when the dollar is dropping like a stone.
AS this article says..if they follow this course..then QE 3 and QE 4 will be out there.
Nope, it is the weak dollar - which now BTW is at par with the dollar in Oz.
And golds is 1400 USD/oz
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