The Dow Jones Industrial Average has hit all time high and free market economists are saying that it is a direct result of the massive Quantitative Easing (money printing) that the Federal Reserve has been doing in a futile attempt to rescue the economy. Bank stocks such as JPMorgan and Citi also hit 52 week highs.
The Fed is simply creating another bubble, only this time it is in the stock market rather than the housing market. And it will burst eventually as all asset bubbles must. Maybe all the inflation being created by the Fed makes the economic numbers look good temporarily but it also causes a lot of damage in the form of rising consumer prices and a miss-allocation of resources in the economy.
Here’s Peter Schiff on Fox Business, who predicted the financial crisis. He says Obama will not finish his second term without the bottom dropping out of the dollar and economy.