In October it was Jim Bullard's "QE4" hint that sent the stock market on an all-time record-breaking run of gains, which no lesser institution than the central banker's central bank - The BIS - lamented "the markets' buoyancy hinges on central banks' every word and deed." And then just two days ago, The Fed did it again: by the mere appearance of grandma Yellen (and the words "patient" and "considerable"), US stocks explode to their greatest back-to-back gains in almost six years. So it is perhaps ironic that no more mainstream media publication than USA Today has finally realised, there are no fundamentals anymore...
Meanwhile, even the BIS is scratching its head at the clear, overt and tangible intrevention by the US central bank to avoid a stock market crash at all costs:
Once again, on the heels of the turbulence, major central banks made soothing statements, suggesting that they might delay normalisation in light of evolving macroeconomic conditions.
Recent events, if anything, have highlighted once more the degree to which markets are relying on central banks: the markets' buoyancy hinges on central banks' every word and deed
Welcome, mainstream, to the new normal.