If the monthly chart of the COMP is to be believed, 4% is the ‘reward’ side of the risk/reward equation in tech stocks. COMP could gobble that up in 3 days.
Bulls have surely won. The market has gone much higher than I for one thought it would when I got bullish on its prospects in late 2012.  Much higher; but then I am not a bubble chasing momo. I am a conservative player with a negative view of the mechanics that have produced this bubble. Still, there is no use denying its reality.
Interlude
Cue SlopeCharts… this is a bubble and it has been created by the ZIRP-pinned Fed Funds rate (black line below) at the expense of savers. Unlike the 1995 to 2000 bubble, this one is right in line with its underlying corporate profits. By a PE ratio measure the market is simply over valued, not a bubble.
But I ask you again (and again and again, I know) to consider that the bubble is the policyand the big question in all of this is why, with the economy on square footing and corporate board rooms raking in the dough, do our monetary leaders continue to take from the poor and pay out to the rich?
Much like with the minimum wage debate, can’t we find a little something for Grandma in all of this as well? All she wants is to use her passbook for monthly withdrawals and see some of that replaced by interest returned on her savings. It used to be as American as apple pie, saving that is.
So hey Janet, will you and the eggheads you meet with at the next FOMC please consider firming up here and ending ZIRP or at least tapering it up (you know, .5% → 1% → 1.5%… can you handle that?) while T bond purchases are tapered down? Show the ultimate in confidence and get on the path to normalizing policy. People are gainfully making a killing in the stock market with your predecessor’s compliments and now it is time to help the non-speculators.
