Wednesday, August 10, 2011

The Rip Your Face Rally on Bernanke's Moustache

The US market started off way off it's pre-trading lows, to open 1.5% higher, before falling off aggressively on the intial statements by the Fed, with 3 members dissenting from action to stimulate (First time since 1992 this happened).

Then Ben delivered his patented market put - keeping rates low for another 2 years. He then backed it up with some unclear statements as to the how - 'range of policy tools'.

This brings up the much expected talks of QE3, treasuries losing 28bps to 2.03% - an all time record low.