Proof Of How QE Works
There’s so much confusion out there about how money gets from the Fed into the stock and bond markets. I see the comments in my Twitter feed. People are clueless. Like how M1 is causal. Or how the Fed pumps money into the banking system and that doubles back somehow to speculative bubbles.
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The US stock market finished session down on Friday, 15 January 2021, as investors negative sentiment was generated in reaction to disappointing earnings news from financial giants Wells Fargo, Citigroup, and JPMorgan Chase, and report from the Commerce Department showing a continued decline in U. S. retail sales in the month of December. Concern over a slow rollout of COVID-19 vaccines has also weighed on sentiment.
At the close of trade, the Dow Jones Industrial Average index dropped 177.26 points, or 0.57%, to 30,814.28. The S&P 500 index shed 27.29 points, or 0.72%, to 3,768.25. The tech-heavy Nasdaq Composite Index declined 114.13 points, or 0.87%, to 12,998.50.
Major benchmarks also notched weekly declines, with the Dow off 0.9%, and the S&P 500 and Nasdaq both down 1.5%.