NEW YORK ( TheStreet) -- Throughout the financial crisis I argued that we were in good hands with Ben Bernanke guiding the economy. I believe those who conclude that the efforts of QE1 were a failure are 100% wrong. The primary purpose of the Fed is to stimulate confidence in times of economic contraction and to temper inflation in times of economic growth.
As much as we all want to believe that our economy is built upon a rock of fundamental safety, it is not. All economies do well in times of confidence and suffer from the lack thereof. Bernanke understands this and has consistently been able to provide the economy with jolts of confidence when it needs it most.
QE1 policy was the reason we avoided a Depression. Although it didn't propel us to high growth or result in a return to lower unemployment it did put a stop to the free fall of both data points. That in and of itself was a big, big deal.
Now we get QE2 at a time when the recovery had stalled. Stage one of the market recovery lasted from the March 2009 low until the end of the year. Stage two of the market recovery could never get off the ground. It has been stuck in neutral (tight trading range) for 10 months as housing, unemployment, eurozone crisis, tight lending, etc... keep a cap on the cycle.