Monday, March 23, 2020

Cue the helicopters...

The Fed has effectively announced QE 4EVER - expansion of it's plans and a willingness to buy unlimited Treasuries and mortgage securities.

I won't sugar coat this.  A former Goldman bailout artist (Mnuchin) couldn't get his "slush fund" - he wanted effective control of $425 billion to control at his discretion - in the Congressional bill, so instead he put a call into the "independent" Federal Reserve.

This is the day capitalism died in the US.

As discussed last night, if they get what they want Wall Street is going to buy this market like Beanie Babies in 1998. We bounced EXACTLY off that 2180 number on the S&P and ran to 2300 as the charts predicted. The technicians could easily push it up another meaningful 5-10-15% from here (especially, if Congress folds today).

So why, people are dying around the US at least the pajama traders in Greenwich, The Hamptons and Clayton will be rolling in they piles of cash.

A final thought - the markets have been conditioned to think "Fed action = buy STONKS!" but the problem isn't liquidity. It's demand.  No one is buying anything, conducting any business and no amount of Fed talk can fix that.

Good times.

Oh and we're only 1 week into an 8-12 week event. Awesome.

Cheers!

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