Richard Russell, author of the Dow Theory Letters, continues to be unhappy with the Federal Reserve and its chairman Ben Bernanke.He blames Bernanke for distorting the markets.
“The stock market possesses the ability to forecast coming events,” writes Russell for King World News. “But the periodic spates of Fed stimulation have thrown some sand into the stock market’s delicate machine.”
He doesn’t stop there.
“Yes, we had the usual late-session rally,” writes Russell. “Is the Fed buying the Dow at the close? It wouldn’t surprise me.”
Even if the Fed were actively trading the stock markets, Russell thinks it wouldn’t be able to offset the power of the bear market that’s being signalled by Dow theory.
Here’s an epic analogy:
Like the great tide of the ocean, the primary trend of the stock market functions in its own way, this despite the desires of man. The Bible tells us of the instance when Jesus commanded the ocean to become quiet and the waves to die down. The ocean reacted exactly as Jesus commanded. All well and good, but it is well to remember that Ben S. Bernanke is no Jesus.”
Russell also tackles gold, which he believes is heading higher.
Read more at KingWorldNews.com.