“Everyone knows that even a little cutback in the Fed’s buyback program should mean falling stock and bond prices. A trillion dollars a year is a lot of money – in fact, it’s 7% of GDP. Imagine a corporation with annual revenue of $100 billion. Imagine that it buys back its own shares at the rate of $7 billion a year. Then try to imagine what would happen to the share price when the largest single buyer drops out. It doesn’t take a genius to figure it out. Even Fed economists can see it. That’s why they won’t taper. And everybody knows it. That’s why bad news is now good news. And good news is good news. Everything Is Good News!”
http://www.bonnerandpartners.com/is-bad-news-good-news-for-us-stocks/
Related posts:
Fed to America: ‘QE Scam Will Continue’
Bill Bonner: Here Come the Money Helicopters
U.S. Officials Are Above the Law of Nations and Ordinary Laws
Bill Bonner: This Unexpected Event Will Cut the S&P 500 in Half
Bill Bonner: The First Shot in the War on Cash?
Bill Bonner: Can paper money survive a full credit cycle?
Detlev Schlichter: U.S. Republicans introduce gold standard debate – mainstream media go mental
Sequester solved: Sell national parks, stop foreign aid, leave Germany
Which One Should Be Banned?
Jacob Hornberger: Gun Control? What About U.S. Arms Sales?
3 Reasons Not to Go to War with Syria
New Mexico Police Fire Into Minivan Filled With Children
Bill Bonner: Send Our Troops to Ukraine?
Edward Snowden – A Real American Hero
Eric Margolis: US Struggle With Iran's Peace Offensive