The decision by the Fed to extend near-zero interest rates through mid-2015 and begin purchasing approximately $40 billion of mortgage backed securities (MBS) on a monthly basis is the latest QE measure in an effort to stimulate the economy and improve the U.S. employment picture. As market analyst Dennis Gartman recommended, “For now, the ‘inflationists’ have the ball; join them; run with them. It will be easier and it will be far, far more profitable.” As I had written back in August 2011, these actions by the Fed are the “complete inverse to thirty years ago when Paul Volcker was fighting a different battle and swore to fight inflation.” In short, don’t fight the Fed, embrace it.
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