- QE Program
- Gasoline prices explode upward with the rise in Oil
- Consumers pull back discretionary spending
- Economic growth slows down
- Oil drops because of slower economic growth
- Politicians lecture about the need to create more jobs
- The Fed notes slower economic growth
- Consumers benefit from lower gas prices
- Just as the economy starts to benefit from more discretionary capital being allocated towards the Retail & Consumer sectors and away from high input costs like Fuel
- The Federal Reserve hints at QE3 and all asset prices inflate in less than a month with crude gaining $16 a barrel
- Consumers and the economy start pulling back all over again.
There are actually market reasons why prices should retreat in a slower growth economy, and this is part of the natural business cycle. But these QE initiatives never give the natural forces of lower input costs which given enough time to work their way through the supply chain can add a lot to stimulate creative and economic growth which is actually sustainable. And when the economy is really humming along market prices will increase just fine on their own accord. But artificially pumping the economy with steroids in the form of another QE3 Initiative is just self-defeating in the long run.
John Buckingham: Busting the Myths & Seven “Valuable” Themes for 2021 [ValueWalk Webinar slides and video]
John Buckingham's presentation titled, 'Busting the Myths & Seven "Valuable" Themes for 2021'. The webinar for ValueWalk Premium members took place on 2/23/2021, and was followed by a Q&A. Stay tuned for our next webinar, Q4 2020 hedge fund letters, conferences and more John Buckingham Principal, Portfolio Manager, Kovitz Editor of The Prudent Speculator newsletter Read More
Obviously, QEs in themselves do not work or we wouldn`t have to keep doing another iteration. Will there be a QE4,5,6,………………….100? These are not UFC events, if you have to keep doing another QE Initiative that ought to tell policy makers that there is a problem here with their effectiveness in the first place.