Groundhog Day

Investors love when the Central Banks print money to help solve the sovereign debt and banking crisis. As investors we have seen this many times before.  Looks like a scene from the movie groundhog day as the actions have been repeated time and time again without any real lasting solution to the main economic issues.  Will companies expand or borrow money to create jobs? No. Are savers being wiped out by low interest rates compared to inflation. Yes. Any answer to high unemployment rates in the U.S. and Europe?  No.  Is the short-term stock market artificially inflated by these actions? Yes.  Is the long term world economy being hurt by these short term actions? Yes. The world eeconomy will be facing even more headwinds as the ECB and the Fed drains the liquidity added. Investors need to be careful what they ask for on Groundhog Day. Just as a reminder, the Fed has offered dollar swap lines and the amount has been increasing since May up from $22 to $30 billion. The Euro problem is worse not better as these lines are not zero and heading higher again. Look at the link by the New York Fed required for full disclosure to taxpayers. http://www.newyorkfed.org/markets/fxswap/fxswap_recent.cfm. In my opinion this is the last great time to exit the market. We have seen this movie before.