First - always remember, what The Fed does is for Main Street, Not Wall Street (since 1987):
[6]
And with that in mind, here is what QE hath wrought...
S&P 500
- SPX QE Returns: +176.23%
- SPX Non-QE Returns: -32.73%
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[8]
Europe STOXX 600
- Europe STOXX 600 QE Return: +106.16%
- Europe STOXX 600 Non-QE Return: -9.37%
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[10]
Japan's Nikkei 225
- NKY QE Returns: +154.39%
- NKY Non-QE Returns: -7.49%
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WTI Crude
- WTI QE Returns: +119.48%
- WTI Non-QE Returns: -105.14%
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Spot Gold
- Gold QE Returns: +3.31%
- Gold Non-QE Returns: +41.59%
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5Y5Y Inflation Breakevens
- QE: -97bps
- Non-QE: +204bps
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[18]
US 10Yr Breakeven Rate
- QE: -104bps
- Non-QE: +275bps
[19]
US 10Yr Treasury Yield
- QE: -293bps
- Non-QE: +184bps
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[21]
So - feel better now? Seems like QE really did the trick.
* * *
And now The Fed's balance-sheet is in decline...
On a rolling three-month basis, the Fed's balance sheet has been declining for the last two months.
[22]
And the three-month difference in total Fed assets has produced some interesting relationships since QE started. Below are some economic indicators that caught our eye...
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[25]
[26]
As we noted previously [27], it appears Yellen is going to need to find an excuse to crank the flow once again...