russiangambit (29.98)

UK economy "unexpectedly" contracts, QE in the talks again

October 23, 2009 – Comments (1)

UK economy "unexpectedly" contracted , and the proposed cure - more QE.

http://www.bloomberg.com/apps/news?pid=20601087&sid=aSM.ff8A31cA

Since UK economy is a samller twin of the US economy, Bernanke probably now thinks that he needs to extend the QE, whichis expring in October, to escape the same fate. Of course, niether one will acknowledge that money printing is not  a solution in the first place.

I guess that means dollar going down further and US stocks going hihger in expectation of more QE.

It is really a twilight zone, when stock are going up because things are so bad most stimilus is likely which is going to be good for stocks. Stock market is more like a parsite on the economy right now, - it doesn't matter  if the host is in bad shape as long as nutrients keep being pumped into the system to keep the host alive.