Zeev's Turnips Patch-No Politics (ZEEV)

[Ace Hanlon]

There is more to the recent pattern that helps explain why the rally has been so strong.

Bad news hits in the morning. Bonds rally sharply while stocks drop modestly. Then stocks rally back into plus territory by the close while bonds keep most of their gains.

It is the persistent rally in fixed income that is largely responsible for the great strength of the stock rally IMHO. Fixed income generally dropped during past bear market rallies, but this time is very different.

"Moral hazard" from the Fed plus renewed faith that if easy money does not solve a problem, even easier money will.