On Thursday, the Federal Reserve announced its biggest market intervention to date, a massive $1.5 trillion injection into the short-term funding markets (“repo”) aimed at preventing grossly-inflated stock valuations from resetting at lower prices. There should be no misunderstanding about the Fed’s real intention or whether its meddling will work. When financial assets are purchased in bulk, prices rise, that is the immutable law of the market. Stocks and bonds do not differentiate between day-traders and Central Bankers. What matters is the amount of money and what securities are purchased. What we know from 3 iterations of Quantitative Easing (QE) is that, when the Fed buys financial assets (USTs or MBS) stock prices climb higher. Friday’s trading will undoubtedly produce the same result.

via The Fed’s latest Welfare Payout to the crooked Wall Street Banks, by Mike Whitney – The Unz Review