The big banks love Ben Bernanke for the free money they've been given over the last few years. They have been direct recipients of his QE policy and the companies that have benefited the most.
Yet Bernanke's dovish 'print-more-money' statements on Wednesday has not seen large financial stocks like JPMorgan Chase & Co. (JPM) and Wells Fargo & Co. (WFC) rally. While the whole market was sharply up, Thursday, JPM and WFC were flat-to-lower. Does that mean the smart money is questioning what Ben Bernanke said?
Smarter Than The Average Investor
Perhaps the smart money is smarter than the stock market as a whole, realizing that the Federal Reserve will be withdrawing at least some of its QE before the year's out.
As an investor or trader, one must pay close attention to this divergence between the stock market in general and the financial stocks in particular. Indeed, something is wrong when the market rallies because Ben Bernanke says he's going to print money forever and the financial stocks can't catch a bid.
Gareth Soloway
Chief Market Strategist
www.InTheMoneyStocks.com