Friday, February 7, 2014

Bill Fleckenstein - This Will be the Last FED Taper

The S&P got a bid last year, thanks to the fact that the Fed printed $1 trillion, now the Fed thinks everything is fine and so they are trying to taper. Of course the only reason the market went to where it did was because of all the money they printed.

So I think this will be the last taper because the markets are going to continue to be roughed up. A lot of hot money has been spilled around the globe, and now it’s now coming back. One of these days the discussion is going to take place where people say, ‘The Fed can’t stop printing money. They can’t leave ZIRP (Zero Interest Rate Policy), but what they do is ineffective.’

So at some point people will see the Fed is trapped and that’s really going to be when things get interesting. Right now, even though markets are under pressure, people still have total confidence in the Fed and bonds are rallying. This is an extremely important moment, even though nothing really appears to have changed, because the Fed is still revered.

- Source, Bill Fleckenstein via King World News: