Want To Know What The S&P500 Does Next? Just Look At The Fed's Balance Sheet

Zero Hedge ^ | 1-28-2016 | Tyler Durden

[Citizen Zed]

Over the past 7 years, we as well as others (if not those who believe in magic money trees, or managing other people's money while blogging) have repeatedly said that when it comes to "market" returns, look no further than the size of the Fed's balance sheet - the single best indictor of where the S&P500 is headed to next.

That is precisely what DB's Jim Reid did overnight. This is what he says:

Today we update a chart and table we used a fair amount in 2013/4 looking at the Fed balance sheet and equity and credit performance.

[Citizen Zed]

[alexander_busek]

I see no predictive power in that graph. The two curves parallel each other; it would be more interesting if the curve representing the Fed's balance sheet showed behavior anticipating movements in the S&P500.

Regards,

[PGR88]

When the Fed announces its various schemes, such as QE, operation Twist, etc... then you know its expanding its balance sheet.

But then again, the market has already been front-run by Wall Street, who own the Fed, and who know far better than the average citizen what the Fed is going to do, and when.

its just one of the many ways that the Fed is destroying this country.

[proxy_user]

I’m glad Zero Hedge knows what’s going to happen in the future. Maybe they should be trading stocks, instead of running a rinky-dink web site.

[Cringing Negativism Network]

I think the single largest factor on the US equities market, is whether Donald Trump will win the nomination.

I think that is driving the markets at the moment. If he wins, a lot of American manufacturing will begin to return to America.

That will badly impact the companies which have sold out to China, but it will (hugely) be made up for, by the companies which will bring back factories to the US.

Trump is in my opinion, the biggest possible market impact right now.

Watch Iowa.

[poinq]

There was a Trillion dollar budget OK’ed by congress. That will count for a lot in the next few months. I would say most of that should be showing up in three to six months.

[ATOMIC_PUNK]

https://www.youtube.com/watch?feature=player_embedded&v=6Afpey7Eldo