THE FED: NIGHTMARE OR FANTASY ISLAND. The FED is an organization that has no common sense and only understands theory which is as worthless – by Todd Horwitz, Bubba Trading


Todd’s Daily Video here:


Boss, the plane, the plane as Tattoo used to yell out the Mr. Rourke. That feels like the market we have now, Fantasy Island. We have a stock market that knows no bounds and continues to try and push to new highs although they are few percentage points away from those highs.

The markets are overvalued and based on cheap money created by the Federal Reserve, an organization that has never made the right decision. The FED is an organization that has no common sense and only understands theory which is as worthless. Theory is fine for a plan, but plans need to be flexible.

Let’s take a look at what has transpired the last 9 years the FED, the middle class continues to dwindle down, the FED has created 5 trillion in more debt, and wages continue to stagnate. To their credit, 401ks and IRA’S have grown, we can’t eat or save but our retirement funds look good. Of course, that’s if you have a 401k or IRA, which many don’t because they aren’t working and if they are they are struggling to eat.

Wages suck, credit card and margin debt are at all-time highs, but at least the stock market is higher. We continue to hear about job growth but nothing about wage growth. Health care is still a disaster, the deficit is over 20 trillion and growing by the second. Here is a reference to how much that is; a million seconds is 11 days; a billion seconds is 32 years and a trillion seconds is 32,000 years.

In other words, the deficit will never get paid back it will only get bigger. We are in Fantasy Island which promises to turn into a nightmare unless we wake up before it’s too late. It’s never too late to address a problem but the first thing that must be done is to admit that you have one.
I don’t foresee the FED ever admitting they have a problem but it’s obvious that they do, and they have no way out until they make the tough decision. We need an audit of the FED and the government, until that is done the middle class will continue to fail. Either we put a tourniquet on spending and become fiscally responsible or we bleed out.

Keep those stops tight
Todd “Bubba” Horwitz


Financial & Political Commentary



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About the author

Todd Horwitz - Author of “Average Joe Options“. Todd began his trading career in 1980 at the CBOE. He was one of the original traders in the OEX & helped start the SPX. He is a member the CME where he trades S&P futures as well as foreign currencies & is a regular contributor to CNBC, Bloomberg, BNN, Fox & many other major news networks.