Bernanke is living up to his reputation as helicopter drops of cash will rain on markets until his academic research is vindicated. It’s as most have been saying, “when push comes to shove politicians and officials will choose to inflate.” Theoretically, barring heavy central bank sales, investors have been given the green light to buy gold and hold it until the Fed reverses course. Uncle Buck will also take a hit.

So, the markets love this and you can buy, so bulls say, what you wish with both hands since the Fed is determined to inflate everything. And, we know it’s the gift-giving season so the Fed tossed the bulls what they needed to make things look better by year-end. [Hmmm, I wonder if Crammer was trashing the Ultra leveraged long ETFs today? And, all those people he told to sell at the low he now wants them to buy? What a guy!]

I haven’t counted the number of days like this we’ve had since the bear market began in January but there have been many.

Most volume today took place after the Fed announcement and then it was strong. Breadth was quite positive and may have yielded a 90/10 day but not according to Yahoo or the WSJ below.








Meanwhile, our man in Geneva [sounds glamorous, but he soon returns to Boise] believes it was a 90/10 day based on his calculation methods for the NYSE.
























































































































The Fed pleasantly surprised markets by taking the gloves off and lowering interest rates to where we already knew they were: zero.

Isn’t it interesting that when the markets are down you get carnival barkers like Crammer trashing inverse or leveraged short issues but no mention of the leveraged long issues today? That’s part of the populist conflicted con game these guys play. When markets are steamrolling south or north it’s the sell or buy programs, linked to futures, which do all the damage not ETFs. To suggest otherwise is absurd.

There are really only 7 [not shortened or low volume affairs] serious trading days left in the year. Today was a classic Fed abetted window-dressing affair. But, it is what it is. For technicians you can’t fight the tape.

Friday is quad witching [I’ll get this right yet] and there should be plenty of crazy action this time.

Many times, the day after a Fed decision markets reverse course if only briefly. The momentum today was excellent. What I don’t like are still escalating bond yields with stocks rising strongly at the same time.

The Fed has elected to throw caution to the wind and is pulling out all the stops. This should encourage you but make you also wonder just how bad things are. The danger is that Bernanke like Greenspan before him won’t know when to take away the punch bowl.

Let’s see what happens.

Have a pleasant evening.

Disclaimer: The ETF Digest is long GLD, FXE and FXI.