Don’t ever underestimate the power of central bankers who are terrified of a global stock market decline.
Over night, the Bank of Japan announced their plans to initiate another round of QE (Quantitative Easing). They will be purchasing bonds as well as Exchange Traded Funds and other forms of equity for their pensions and any other accounts they can find to park these securities.
As such, the Japanese Yen collapsed, the US dollar rallied and stocks were off to the races.
This may be a sign that much higher prices are coming into 2015. After all, you know the term, you can fight the Fed. This time, there will be a Japanese put under the market for a while.
If asset prices are rising, it’s easy to make the case there is an economic recovery underway. With this program, the intention is to levitate asset prices as high and for as long as possible.
Of course the market is currently very over bought and will require a pull back before heading higher, but higher we shall go into next year.
As a result of the same announcement today, Gold got the shine kicked out of it. As you’ve been hearing from me, lower prices were coming. There here, and it’s going to get worse before it gets better.
Oil also took a dive today and broke the $80 level, but has since recovered slightly. Lower prices also remain in this market – Like down to $75 give or take.
Much more analyses in the video below.