Quote:
Originally Posted by Vanity
Yes! With this predicate in mind, remember that last year the markets sold-off 22% and only got Operation Twist (which, imo, wasn't enough to completely pick up the markets), and then LTRO's coming in December to push us farther up. They had been expecting QE3 last year as well.
This year, I'm more inclined to think that when we do sell-off that we might be pushing -25% or more to get QE3 out of the box, as I doubt the ECB will be coming in with anymore LTRO's (unless they must choose between the lesser of two evils: inflation or default).
Nonetheless, I have no crystal ball and cannot predict the future. But this year should be very interesting to play!
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This is definitely a sound argument in my opinion. As last year we saw the correction occur with the end of QE2, I think we will see the same result with the end of the twist. Hopefully, they will let the market unravel to a level low enough to get QE3 rolling and not intervine before with another twist or some other form of appreciating the market. The more they artificially stimulate the market though, in the long run, could lead to a nasty unravelling some day
Oh well guess we will just make money until then
