The Fed Cannot Stave Off The Inevitable Market Revaluation

The Fed has yet to learn that you can't fool Mother Nature for very long, but it's about to get a punishing lesson.

Did the Federal Reserve's QE2 program last year simply push the inevitable stock market decline forward a few months? It would seem so. In Remind Us Again Why Anyone Should Own Stocks For the Next Two Years (August 3, 2011) and The Junkie in the Pool and False Idols: Faith in Wall Street and The Fed Has Has Eroded (August 10, 2011) I included a chart of the current S&P 500 plotted against the two Great Bear Markets of last century, the Great Depression-era Dow Jones Industrial Average (1929 crash) and the Nikkei stock market from 1989.
 
It certainly looked like all the Fed accomplished with its $600 billion QE2 was stave off the inevitable by a few months:

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