from 5 Min forecast:
“According to a new study from the Federal Reserve Bank of New
York,” Chris writes by way of background, “about half of the stock
market returns enjoyed in the past decade are a result of the actions taken by
the U.S. central bank.
“The study guessed that if you excluded Fed actions over the last decade, the S&P 500 would be at 600 today — instead of 1,352. Put another way, the study essentially says that the gains we’ve seen in the market are mostly fake. They are not due to real earnings gains, but just manufactured good looks that come from printing money.
“This reminds me of an old Seinfeld episode with the following dialogue”:
“The study guessed that if you excluded Fed actions over the last decade, the S&P 500 would be at 600 today — instead of 1,352. Put another way, the study essentially says that the gains we’ve seen in the market are mostly fake. They are not due to real earnings gains, but just manufactured good looks that come from printing money.
“This reminds me of an old Seinfeld episode with the following dialogue”:
“Jerry: What about the breathing, the panting, the moaning, the screaming? “Elaine: Fake, fake, fake, fake.
“Likewise, we might say,
‘But what about all those earnings reports and conference calls, the boosted
sales, the profit margins?’”
“Fake, fake, fake, fake!”
“Fake, fake, fake, fake!”
