Charlie Jamieson, Executive Director at Jamieson Coote Bonds says the Fed has a track record of dishing out stimulus each time the S&P has fallen around 20%. “Historically under QE programs we’ve seen stimulus for the market at that level. When the Federal Reserve finished QE1, the S&P dropped roughly 20% and they immediately launched QE2. When they finished QE2 the S&P dropped 19% and they immediately launched “Operation Twist.” Operation Twist, they tried to stop early and we had what was famously referred to as the “Taper Tantrum” and they immediately extended the program. So you’ve seen a history of Federal Reserve action… (which) supports the market around those levels.” Watch the interview for more detail and the levels that Jamieson sees support from current pullback.
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