The market rose over 300 points today, mostly on hopes and rumors that the Fed will take some kind of action this week at Jackson Hole – perhaps announcing plans to buy up more bonds and thus begin QE3.
Yes, folks, it’s a “when bad news is good news” kind of moment for stocks:
Another round of dismal economic reports prompted hopes that Federal Reserve Chairman Ben Bernanke will employ more accommodative measures to boost the economy. The Richmond Fed’s regional manufacturing survey showed sharply declining economic activity this month. New home sales also dropped for a third straight month and fell to the lowest level since February.
The downbeat reports have put more of an emphasis on Bernanke’s scheduled speech in Jackson Hole, Wyo., on Friday. Investors hope Bernanke will be more open to new easing measures, but at the same time are unclear as to what the central bank may have in store.
“There’s definitely a tint of optimism that he’ll pull a rabbit out of his hat,” said Michael Church, president of Addison Capital.
Compared to rumors and conjecture, things like a little acid reflux from the Earth’s tectonic plates were relatively ignored. After the initial “oh s***” reaction to today’s earthquake, it failed to dampen the hope that another helicopter drop is incoming.
And speaking of the rest of today’s breaking news, we’re also beginning to think there is some kind of conspiracy theory afoot with the runs on discontinued HP Touchpads that have been all over the news lately. Seriously, this much hype for a $99 tablet PC? A couple nefarious possibilities include:
- The Fed has been actually been the buyer for these tablets, thus increasing monetary supply $99 at a time every time it can nab one from Best Buy, Staples or OnSale; they’ll subsequently be spraypainted gold and used as filler to replace the sold-off reserves in Fort Knox
- Plunge Protection Team is acquiring the tablets and is developing a cutting-edge WebOS app that steps in at 3:30pm to BUY BUY BUY if the market falls more than -2%
Got another idea? Leave it in the comments