http://www.ritholtz.com/blog/2009/09...-real-economy/

9/16/09 from M. Ramsey King Securities, Inc. The King Report

Yesterday Bernanke said the recession has probably ended. If the recession has ended shouldn’t the Fed at its meeting next week at least stop QE and the massive monetization of mortgages?

Benito: “Even though from a technical perspective the recession is very likely over at this point, it’s still going to feel like a very weak economy for some time”.
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Traders and investors must contemplate what course of action the Fed will announce and enact after next week’s FOMC if ‘the recession is probably over’.

If QE, which is due to expire, is renewed, stocks should rally but commodities, gold and inflation plays should rally far more. The dollar should tank. China should go apoplectic. Benito will look foolish for saying “the recession is likely over”. Bonds might rally initially but then look out below.

If QE is not renewed, stocks and commodities should tank; the dollar should soar and bonds after initially declining should rally. China will be appeased. Benito will have validated his rhetoric with action.

Given that the select few have been informed about coming policy before the non-connected, it is incumbent upon investors and traders to scrutinize the usual suspects for hints about Benito’s next ploy.

So which will it be?