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This blog post originally appeared on RealMoney Silver on Aug. 11 at 7:33 a.m. EDT.

"At this stage of recovery, you want Fed policy to be accommodating for investing, but you don't want it to be the reason for investing." -- Mike O'Rourke, BTIG

To me, the market is looking for love in all the wrong places.

Yesterday was a case in point, as market participants waited breathlessly for the


decision. Tuesday's quantitative easing (QE) "lite" was initially considered a positive, but, not surprisingly and upon further reflection, the

S&P 500

futures plummeted overnight.

In reality, QE lite doesn't move the needle, and lower interest rates have failed to stimulate growth over the past several months. Indeed, the most interest-rate-sensitive sector, housing, is now turning lower.

Consider that we are now nearly a year into "recovery," yet all the discussion this week is about the need for more monetary easing and the need to lower interest rates further. Doesn't this point to the frail economic foundation and to weak fiscal policy? And doesn't the generational low in interest rates mask the fundamental differences in place in this cycle? Yet, the Fed is acting no different than the previous Greenspan regime.

Federal Reserve policy has likely done as much as it can and as much as it should:

  • Zero-interest-rate policy stopped the Great Decession and the economic freefall, but it has failed to create jobs.
  • Quantitative easing has also helped to halt the financial crisis, but it did little to encourage small-business hiring.
  • TARP stopped the carnage in the banking system, but it did little to encourage lending.
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Monetary (and quantitative) easing may no longer be the solution to the plight of the sluggish and shallow recovery in the domestic economy. A

new playbook

is needed to create jobs, and the uncertainty of tax policy and the costly burden of regulation must be addressed.

Consider me from Missouri, as I am not optimistic that our politicians will reverse policy any time soon, but, in the interests of growth, they should consider it.

Investors, too, are now in a show-me mode, as they wait for more economic data points.

The continued economic ambiguity argues in favor of a conservative investment strategy and below-average positions.

Err on the side of conservatism during these uncertain times.

Doug Kass writes daily for

RealMoney Silver

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Doug Kass is the general partner Seabreeze Partners Long/Short LP and Seabreeze Partners Long/Short Offshore LP. Under no circumstances does this information represent a recommendation to buy, sell or hold any security.