DJ MARKET TALK: Punch Will Run Out At QE2 Party, Eventually
1:05 (Dow Jones) Stocks and commodities have rallied ahead of the Fed's expected dive into QE2, but the run won't last, Michael Shedlock says at his Global Economic Trend Analysis blog. "We're in this mess because of overleveraged consumers, businesses, and financial institutions...You don't cure a problem caused by excessive liquidity with more liquidity," he says. "The problem isn't falling prices, but falling demand for loans." Enjoy the QE party while it lasts. "Unfortunately, it adds to the problems in the real economy, and it surely adds to the Fed's exit problems down the road," Shedlock says.