Sorry, But Bernanke Is Not The Reason The Stock Market Is Higher

In a note today, Northern Trust’s Asha Bangalore posted this chart, and our Henry Blodget argued that it was clear that Bernanke was inflating stock prices.

chart

That is remarkable, but it’s a coincidence. Stocks have been correlated for a long time pretty nicely with initial claims, and, well, check out this chart of the S&P 500 vs. the inverse of initial claims since 2008.

The red is the stock market, blue is the inverse of initial claims.

chart

See, they match up pretty nicely, even during the mid 2010 slump. It’s not perfect, but it makes just as much sense as saying that Bernanke controls the market.

And lest you think this is a recent phenomenon, it’s not. Let’s go back to 2000.

chart

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