Don't Rule Out The Fed Buying Stocks Directly

The S&P 500 is up 37% year over year and the Fed is talking about tapering their purchases of mortgage backed securities and US treasuries. How the hell can the market maintain this vertical trajectory when the $120 billion per month in free Fed money is going to start shrinking? One way is for the fed to replace their waning bond purchases with far more potent equity purchases. It may sound crazy, but for most of Fed history, mortgage backed securities were not on the Feds balance sheet either. One thing is for certain however; Jerome Powell will do everything in his power to keep the stock market green. He has made that abundantly clear over the last 3-4 years.