From Ron Griess of the Chart Store, a very telling chart above. Every subsequent Fed intervention seems to have a diminishing impact on risk assets and equity markets.

Category: Bailouts, Federal Reserve

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

6 Responses to “QE1-2 Operation Twist(s) Market Impact”

  1. nofoulsontheplayground says:

    This reminds me of the period leading up to the 2007 market peak. At that time it took $7.00 in new debt to create an additional $1.00 in GDP. There seems to be a similar parallel between the lead in to the private debt bubble peak and the Fed’s ongoing QE program with respect to the apparent diminishing returns.

  2. Hammer of Thor says:

    Is QE1 the only reason markets rebounded in March 2009? Perhaps the chart is showing a pattern here where one may not exist.

  3. SomewhatRandom says:

    I’m sure you know the joke about the scientist measuring how far a frog can jump. He places a frog on the table, yells “Jump, Frog”, and writes in his notebook “Frog with 4 legs jumps 40 feet”. A bit of surgery later, “Jump, Frog” and he writes in his notebook “Frog with 3 legs jumps 35 feet”. More surgery, “Jump, Frog”, and he writes “Frog with 2 legs jumps 30 feet”, and eventually he writes “Frog with 1 leg jumps 25 feet: in theory, frog with zero legs will jump 20 feet”.

    “Jump, Frog”. No response. “Jump, Frog”. No response. “JUMP, FROG!!!”

    Notebook reads “Mysteriously, frog with no legs goes deaf”.

  4. tyaresun says:

    Or one can say exactly the opposite:

    QE1 took us up to only 50% of the previous high, QE2 took us up 200% of the previous high.

    Beauty is in the eyes of the beholder.

  5. rktbrkr says:

    So the Feds objective isn’t full employment or modest inflation – it’s goal is to maintain high financial asset prices? Great.

  6. blackvegetable says:


    I was wondering of you could help me out here……Lately I’ve begun to suspect that Celebrated Economist, Mohamed El-Erian and Notorious Howard Stern Flunky, Baa-Baa-Booey were separated at birth……

    Are you in a position to confirm?