This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Fed Policy Creates Wall Street Shenanigans

Least Favored in 2013: Featuring the year's shockers from Wall Street to Washington. Read Fed Policy shenanigans; Tech spies; SeaWorld tragedy; Caterpillar-China scandal; Bud Beer scandal; Bill Ackman's Herbalife; LIBOR rigging; Forex Scandal; and check out this video CEO Walk of Shame.
 


NEW YORK (TheStreet) -- Wednesday's Federal Open Market Committee meeting celebrates the fifth anniversary of the 0.0% to 0.25% federal funds rate, which has been bailing out the big money center and regional banks but has not trickled down to help to consumers and small businesses on Main Street.

The statement from Wednesday's FOMC meeting implied that we will likely celebrate a sixth anniversary a year from now. The Federal Reserve did decide to begin to taper its quantitative easing programs in January lowering monthly purchases of mortgage-backed securities by $5 billion to $35 billion per month and purchases of U.S. Treasuries by $5 billion to $40 billion.

Fed policy has been designed to lower long-term interest rates but instead longer-term yields are on the rise. The yield on the U.S. Treasury 10-Year note was as low as 1.614% on May 1 and traded as high as 2.929% after the Federal Reserve's statement. This puts upward pressure on mortgage rates while refueling speculation in commodities and the stock markets.

Ben Bernanke's monetary policy has resulted in Wall Street shenanigans that allow professional investors and traders to speculate in commodities and the stock market resulting in bubbles that always pop. The housing bubble popped between mid-2005 and mid-2006 and is now re-inflating. The crude oil bubble popped in mid-2008 and the gold bubble popped in the third quarter of 2011.

The easy money and Wall Street shenanigans had the major equity averages to peak in late-2007 with a quick bear market into March 2009 when the S&P 500 test the devilish 666 handle. The rally since than is creating the biggest stock market bubbles ever.

1 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,151.40 +19.43 0.11%
S&P 500 2,000.80 +1.82 0.09%
NASDAQ 4,558.7040 +5.9450 0.13%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs