Somebody Stop Ben !

The markets are at a very very critical juncture now. Tomorrow would be the moment which would have changed the destiny of the people for the next 30 years.While Helicopter Ben wants to kill deflation by flushing the market with dollars, the equity markets are rejoicing as if printing money is good.It would have been taboo if we would have said this couple of years back.There are no free lunches in this world. Something gotta give, If Ben wants to create inflation by printing money by reflating all the real assets (aka commodities) in this world, Inflation is going to roar in the next 5-10 years.

If Fed wants to print money like it was no tomorrow, the following would happen in the next few years if Ben wants to enact as he has said in his deflation speech of 2002.

• Gold is going to touch $2500 in the next few years once the short term overbought conditions are dealt with.
• Commodities are going to rally like mad.
• US treasury yields are doing to soar after the markets comes out of this QE dope.
• The equity markets would rally not because we have economy growth but to compensate for inflation.

Our Indian economy could be subject to a huge shock after all the short term euphoria is done. The surge in commodities would kill our current account deficit. It might help the IT sector (6% of GDP) but what about the other sectors.

Somebody stop Ben!!!!!