The major stock market indexes are surging higher today as the European Central Bank says it will buy bonds from struggling banks. This is the same procedure that our own Federal Reserve Bank is doing with it’s quantitative easing plan. All that is happening is capital reserves are being created and this is causing inflation. When the markets inflate the asset prices increase. This makes individuals feel better. As we all know from Black Friday when people feel better they spend money. Well this is what the central banks in Europe and the United States are now trying to do. To their credit it has worked so far, however, when this party ends it will be ugly. This is truly a traders market.
