**[investwise]** Quantitative Easing 2 - my view

 

Because of the Fed buying back govt securities, bond prices will go up (and yields go down).  The excess liquidity created will push up asset prices, including equity and commodities.  Maybe even real estate.

 

This is all illogical, because all asset classes will inflate in price.  Similar to 2008.

 

What people are missing is that the massive infusion of money in the system will create massive inflation (and that is the Fed's intention).  But that will also lower interest rate yields.  That is one of the most illogical thing one can hear.  Interest rates cannot be delinked from inflation.  And one could expect interest rates to increase substantially all over the world.  This has to happen, as I have pointed out time and again.

 

And then, there would be a crash after the bull party.  When would that be?  If I knew, I would be the richest person in the world already.

 

Don't ask me when it would happen, I already told you what will happen. Beware.

 

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