The Global Money Printing Campaign is Working its Magic

By Jerry Robinson

The headlines pumped out of the mainstream press this week were some of the most economically positive that I have seen recently. It seems the global embrace of quantitative easing is finally beginning to work its magic. But central banks do not appear willing (more likely able) to turn off the printing presses.

While the Fed's "wealth effect" is working, it has only served to distort the financial markets through wrong incentives and moral hazard. Today, corporations are sitting on enormous piles of cash and are not hiring like they were in the pre-crisis era. U.S. real estate is still plagued with underwater mortgages and record defaults and foreclosures. And America’s unemployment remains stubbornly high, despite the government’s best attempts at painting a different picture with their bogus "official" numbers.

The stock rally that we are experiencing likely has much more room to continue. Trillions of investment dollars are still sitting on the sidelines in bonds and cash. Americans have short memories. If the stock market continues climbing, money will come pouring into stocks. This will drive prices up even quicker. This will set the stage for the next mega-collapse. I have no predictions on dates when this will occur. However, it is certain due to the vicious cycle created by the Federal Reserve’s inflationary policies coupled with typical investor behavior. [more...]

Jerry Robinson - columnist, and radio host, is featured weekly on Worldnetdaily.com, quoted by USA Today, has appeared on Fox News, and has written columns for Townhall and FinancialSense. Host of Follow the Money Weekly, Jerry deciphers top economic and financial news on his radio show as well as in his popular newsletter, Follow the Money Quarterly.