By Michael Pento of Pento Portfolio Strategies
June 24 (King World News) - Global Markets & The U.S. Are Being Systematically Destroyed
I’ve written exhaustively about the real purpose behind the Fed’s quantitative easing strategy. So one more time for those who still don’t get it: The primary goal of QE is to bolster banks’ balance sheets by re-inflating equity and real estate prices. If investors look back at the history of QE they will be able to clearly see what happens when the Fed steps on the monetary gas -- and what occurs once it takes the foot off the pedal.
For example, though interest rates were already near 0, the Fed felt it necessary to begin purchasing massive amounts of bank assets in late 2008 to get the money supply and stock prices moving in the positive direction. The Fed announced a $500 billion mortgage-backed security purchase program (QE1) on November 25, 2008....