Last week the Fed made definite the hints of quantitative easing. They will buy Treasuries(no one else will)which will pump another $600 billion into the money supply. This monetizing of debt is a direct revelation of a lie that Helicopter Ben Bernanke made last year when he said that the Fed would not monetize the debt. In addition, Treasury Secretary, Turbo Timmy Geithner, said that the Treasury would not seek to devalue the dollar. These blatant lies are better than Young and Restless.
The bottom line is that the dollar has lost 14% of its purchasing power since last July. This may be good for the rally in the stock market, but it is hardship to Main St. At a time of the longest stretch of long-term unemployment, 43.9 million Americans collecting food stamps and the loss of unemployment benefits, the Fed's action has caused the "silent thief" to strike our households. The price of unleaded gasoline has risen 15% since September and according to the Department of Agriculture the price of corn has risen 47% this year. I place these two examples because next week is a big week for government agencies to make their reports or should I say their manipulated, massage announcements.
The Fed also stated last week that they could do QE because inflation was benign. Yeah, right! How can you place the two examples, one in energy and the other in food with their report? Simple. They don't include the things that we need in our daily life. Why do we let them control our money? Why do they even exist?
In any case a report on retail sales will give a clue to the holiday season and effect market direction. Also, we will get another jobless claims report. I bet that they don't mention or include the 2.3 million workers in California who received pink slips last week - and this is only one state. Instead I bet that you will hear about Amazon hiring 1,300 for Christmas who will be back on the street by January. There will also be a report on housing starts and building permits. They can't manipulate this report, however since all the big banks have stopped their foreclosure proceedings, that aspect could effect the stats.
Finally, under the question of why - I place this tidbit. In 1936 the Federal Register which contains rules and regulations was 2,600 pages in length and today, it is over 80,000 pages. How much more can they manipulate? Go figure.
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