Who says stocks are up because the economy is improving? Could be because of the Fed saving the day...
Over the past four months, each time the stock market has sold off reasonably hard, low-and-behold, a Fed official comes out and saves the day! Who says it is just bonds that are distorted by easy monetary policy...it is pretty much every asset class.
Note the chart below and the three big saves by the Fed:
1. Oct 13, 2014 - Fed's Evans says Fed should be exceptionally patient on rates
2. Dec 17, 2014 - FOMC says they will remain patient on rates
3. Jan 6, 2015 - Fed's Williams says the US still needs monetary policy accommodation and sees no reason to rush rate increases
Funnily enough, stocks stopped declining and started rising...on massive volatility.