Fed Yellen To Draghi....Liquidity and Rates

What an interesting day from the perspective of hearing what our two global leaders we're thinking. Fed Yellen pretty much held things status quo. She reiterated that she'll be working off the latest economic reports as they come in to decide when to start raising rates. We all know she wants things quiet so she can find a way to keep rates down near zero. A zero-rate environment is good for equities, which in turn is good for Main Street. Her job remains constant. Never wavering. Keep the market up and keep the economy up.

Without Wall Street you lose the economy, and her job is simply to make sure that doesn't happen under her watch thus the insistence that she keep rates low. If you offer up alternative to the stock market, meaning safety in higher rates, the market falls, and so do those key 401K's people rely on to keep them feeling their wealth is intact. She keeps on talking about how things just aren't quite strong enough for her to raise rates. No matter how much things improve on those key-economic reports she says the same thing because that's what she wants, thus, she plays spin doctor. She's very good at it too. So was Bernanke. She learned from the best, so on we go with low rates, and a bull market that has massive short-term risk, but that's for later on in this note.

Now let's discuss the leader of the European world of finance. Mr Draghi came out today saying things in Europe are nasty. Employment is bad. The economy isn't doing well, and the time has come to be on high alert for doing whatever is necessary to keep things from getting worse. And obviously, to get things rolling on the right track. It was basically implied that if he needs to do a liquidity thrust he would have no problem snapping his fingers to get those printing presses rolling along. QE to be exact. Copy what we did here at home.

The market was expecting this response, thus, no large move higher came when he was done speaking. But the market didn't collapse either. It just pulled back some from extreme levels of overbought. Europe is about to embark on the same adventure we did here at home, and you know the world loves free cash. Desperate times, I guess. So now we have both leaders doing everything in their power to keep their markets alive to keep their economies moving upward. Nice to be the queen and king.

Froth is sadly moving higher once again. It is still the nasty fly in the happy ointment. No matter what happens it seems folks will gobble up equities. The news can be awful or worse, and the market, for now, says I do not care. I want equities. Every free-invested dollar still forced into the stock market. We had potentially terrible news from the Ukraine this morning and the market yawned. In normal times when a country says they're being invaded against their will, gold explodes and the market sinks big time. Not now. It's hard to wrap my head around it, but again, it comes down to what else is available. Nothing it seems for now.

The excuses for selling and selling hard are everywhere. Invasions to overbought to froth, and nothing has yet hit this market in a way that will scare people. At least not yet. I would say it makes sense to have some scratch in the game. Don't have too much. Just enough to say you're in, but knowing you need to respect the negative possibilities. Greed kills. Be smart.