It will be very interesting to see if indeed the Fed implements, in one form or another, a third round of quantitative easing. I follow the financial markets pretty closely since I am in that line work and I am very curious to see how our markets and our overall economy will perform once QE2 comes to an end at the of this month. Clearly, the stock market benefitted during the periods of QE, but the overall economy did not.
Here is a chart that I have constructed which highlights the periods of QE1 and QE2. Constructing charts of this kind is something of a hobby for me. I have been a student of technical analysis for well over 20 years and in the past I constructed my charts by hand, with pencils, markers and graph paper. I still do maintain a few handmade charts, but I now construct most of my charts using websites, such as Stockcharts.com (which I highly reccommend), that are specialized for that purpose. I do not make recommendations to buy or sell individual stocks or ETF’s on this blog, but I do discuss certain “big picture” economic topics from time to time. It will very interesting to revisit an updated version of this chart in 3 months, 6 months and one year from now.