The Fed's Impact On The Market Is Not What You Think | Exploring Markets

The Fed's Impact On The Market Is Not What You Think

Point 1:

"The entire QE program has less than a 1% effect on the ten-year note. QE3 is only a few basis points in terms of direct effect."

And little bit better, point 2:

"There is no direct link from QE investments (think POMO) to purchases of soybeans, oil, stocks, or anything else. If you can't trace the cash, don't risk your stash!"

And most importantly:

"Overemphasis on stock market effects. The Fed is interested in the stock market as a measure of their effectiveness and as a (minor) economic transmission mechanism. From the Fed perspective, the more important measures are interest rates, employment, and GDP."

Read more:

How to Profit by Understanding the Fed, Why have so many TV "experts" been so wrong about the market

http://oldprof.typepad.com/a_dash_of_insight/2013/02/investors-how-to-profit-by-understanding-the-fed.html