Sunday, November 3, 2013

Dow and Monetary Base, Part III






















There was a correlation between the Dow and Monetary Base of 4.9.  This means each billion dollars of printing by the Fed would increase the Dow by 4.9 points.  Then it dropped to 4.7.  Now it has dropped to 4.3.  There still is a correlation, it just isn't strong.  Since the Fed is still pumping at $85 billion/mo, the Dow should rise by 365 points by the end of the year, to about 16,000.

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