Buy and Sell Signals, and Other Market Perspectives Message Board

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Strategies & Market Trends : Buy and Sell Signals, and Other Market Perspectives

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To: Fiscally Conservative who wrote (48552)	4/11/2013 4:24:00 PM
From: KyrosL	Read Replies (3) of 220931

The Fed has two specific (and somewhat contradictory) mandates from Congress: "maximize" employment, AND keep prices stable i.e. preserve the value of the currency. The employment mandate is unique to our Fed and was added relatively recently (1977). The Fed must obey both these mandates, even though many economists believe they are contradictory. It's ridiculous for Congress to criticize the Fed for printing money, while not doing anything to restore the Fed's old single mandate of preserving the value of the currency. So, as long as unemployment is high, the Fed will keep using its one remaining blunt instrument: print money, especially when its other mandate, low CPI inflation, is behaving. The markets have come back huge, but they are not yet up to their old highs, inflation adjusted. The old 2000 SPX high of 1550, corresponds to 2090 in today's dollars.

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