Most are probably familiar with the quote attributed to Einstein that insanity
is doing the same thing over and over again and expecting different results.
The financial version of insanity is expecting a crash or even a sizeable
correction while the Fed is engaged in quantitative easing.
Since the current round of QE is open ended, that raises the probability that
the QE III fueled rally may surpass in length the previous rallies.
The weekly chart below illustrates the point:
There's also the question of whether the belief that one can print his way
to prosperity may also be some form of insanity. But we'll discuss that topic
at a later date.
For the time being, the trend remains up for all the major indices, in all
time frames.
George Krum is the author of the "CIT Dates" blog and several
books available on Amazon.
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