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Stocks Hit New All Time High Just After Bullard Says “Valuations Are Stretched”

Courtesy of ZeroHedge. View original post here.

With the Fed finally admitting it is confused by the "mystery" of inflation, it has also become painfully clear how perplexed it is by the biggest asset bubble in history that the Fed and its central bank peers have blown. But don't call it a humorless bubble.

Case in point, on Wednesday afternoon, St. Louis Fed president James Bullard, who is best known for i) flipflopping from the Fed's biggest hawk to its most wimpish dove and ii) invoking QE4 any time the S&P has even a 3% correction,  said that while “bubble is a strong word", admitted that "equity valuations may be stretched.”

Then, demonstrating phenomenal observations skills, the chief bubble blower said that ”certainly the whole market is up. A lot of it is associated with a few stocks” that are “tech stocks with exceptional valuations.” And just in case there was any confusion why said tech stocks have exception valuations, Bullard then clarified "I am the most dovish member of the FOMC. I used to worry about inflation pressure.”

Ah yes, yet another "economist" who doesn't realize that inflation comes in two places: real economy prices, where the Fed's policies have been a complete disaster, and asset prices, where they have succeeded in unleashing hyperinflation.

And just to confirm that while he is lamenting the bubble the Fed has created, he wants even more of it, Bullard then said “we do not need to be preemptive in trying to get ahead of inflation developments.”

Yes, #Ref!

And while Bullard then went on to cement just how clueless he truly is, claiming that “low productivity has been the key culprit in low GDP growth”, and apparently not 350% debt/GDP, and saying that “you probably won’t see in the U.S. a better labor market than we have today. This is probably as good as it gets” referring to an economic "recovery" built on the backs of several million waiter and bartenders, just after Bullard's warning that "equity valuations may be stretched", the S&P went on and hit a new all time high for one simple reason: the algos know that should the market fall, it will be hacks like Bullard who will come screaming for QE4, 5, and so on, as they watch their precious centrally-planned experiment in "wealth effect" creation on the verge of collapse.


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