Bernanke hit the stop-orders of the foolish investor-crowd
Today almost all the markets had crashed, after a publication of protocols of an old FED meeting held on March 13th. On that meeting it becomes clear that the FOMC doubts on starting the QE3. Panicked by this the markets went on bear tactics and everything went down, while dollar - up. But let's see what exactly happened. On March 27th (2 weeks after the protocolled meeting) Bernanke said that may be QE3 will soon start. At that day the FED Chairman must have known of the March 13th meeting, as he has chaired it. So Bernanke knows of the minutes of the meeting and knows that they will be published on April 3rd. Anyway on March 27th he demonstrates that the QE3 is highly probable. The reaction of markets then was bullish.
So what is happening now? It is so simple... Bernanke is
hitting the stop-orders of the investor crowd. With much investors waiting for
QE3, it is good to take their money, before the QE3 starts. So on March 27th
Bernanke is stimulating the bulls, and this way - moving the stop-orders up,
and also - exhausting the bullish potential of markets. And then - on April 3rd
we see a 3 weeks old protocol that shots down the enthusiasm and takes the
money of fool investors.
If Bernanke was a consistent policy maker, he would not talk
of QE3 at a moment when he already knew what will be published in next days. It
looks funny for him to talk of QE3, while the FOMC is hesitating. But everything looks much like a theatre. The March
13th meeting was made just to be protcolled and the protocols to go public at a
suitable moment. All FOMC members knew what to talk, so the needed effect will
happen on markets. And a theatre was Bernanke's 27th of March talking.
The QE3 is inevitable. No one is buying US government bonds
now. Without QE3 the 100% of GDB public debt of USA will skyrocket the interest
rates bankrupting not only the Obama Administration, but also lots of
businesses, including the very sensitive real estate market. So FED will print
money. But don't think everyone will make profits of printing. Today's hit
stop-orders are to clear the market of too much profit-dreamers. The investors
that succeed in keeping their long positions, will have their share of QE3