This is the latest Forbes column by David Dreman. He thinks stocks and gold sniff inflation in the air.
"Big Ben has done it again, but what he's done he didn't mean to do. QE2 is the moniker affixed to the Fed's second round of quantitative easing, a salvo to jump-start the economy and stave off deflation. Last month the Fed, in a bit of monetary magicianship, began buying the first of what will total at least $600 billion in U.S. Treasury securities by next summer. Ben Bernanke said he wants to keep interest rates low to nurse the nascent recovery into something robust and self-sustaining."
"Unfortunately Fed Chairman Bernanke has an almost flawless record of poor forecasts and policy decisions since his tenure began in 2006. On Mar. 28, 2007 he said, "The impact on the broader economy and financial markets" of the subprime mortgage meltdown "seems likely to be contained." He followed this zinger on June 9, 2008, with a declaration that the danger of a "substantial downturn appears to have diminished." This, of course, was only three months before Lehman Brothers imploded and the economy collapsed."
David Dreman recommends to buy insurers Chub (CB, Financial), drug companies Merck (MRK, Financial), and energy companies Marathon Oil (MRO, Financial). and bank JP Morgan (JPM, Financial).
Read the complete column
"Big Ben has done it again, but what he's done he didn't mean to do. QE2 is the moniker affixed to the Fed's second round of quantitative easing, a salvo to jump-start the economy and stave off deflation. Last month the Fed, in a bit of monetary magicianship, began buying the first of what will total at least $600 billion in U.S. Treasury securities by next summer. Ben Bernanke said he wants to keep interest rates low to nurse the nascent recovery into something robust and self-sustaining."
"Unfortunately Fed Chairman Bernanke has an almost flawless record of poor forecasts and policy decisions since his tenure began in 2006. On Mar. 28, 2007 he said, "The impact on the broader economy and financial markets" of the subprime mortgage meltdown "seems likely to be contained." He followed this zinger on June 9, 2008, with a declaration that the danger of a "substantial downturn appears to have diminished." This, of course, was only three months before Lehman Brothers imploded and the economy collapsed."
David Dreman recommends to buy insurers Chub (CB, Financial), drug companies Merck (MRK, Financial), and energy companies Marathon Oil (MRO, Financial). and bank JP Morgan (JPM, Financial).
Read the complete column
