FED finally found an excuse for QE3

After months of speculations an verbal manipulations of the market, the truth rose as inevitably expected. FED will print more money as a reaction to the crisis in Europe. It is not clear how printing dollars and pouring them in USA will affect the negatives of EU crash. But EU is an enough excuse to start printing.

QE3 is needed not to EU and not to compensate the Greek foolishness. It is needed for Obama  to finance its record deficit. There is no so much investors in USA bonds, the main investor is Bernanke who buys about 70% of all bonds. This is called QE and is explained as "economic stimulus". But it is nothing than a saving the government by the Central Bank.

The markets expected this sign for a long time. The reaction as predicted is skyrocketing in prices. There was a small plunge due to Greece problems. But it looked more like hitting the stop-orders of traders, than a serious bearish move down. Now everything is normalized. Gold and commodities will go up as happens in every inflation era. Oil will also go up. The dollar will go down, stopped eventually only by the faster going down of the Euro. General inflation will occur on almost all markets, and on markets "inflation" means prices up. So the one who buys will profit.

Dobri
May 17th 2012

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