The market has rallied off the 2009 lows, and most people are convinced that the Fed powered the move. In fact, most were certain that once QE ended, the market would drop. And, they currently maintain this conviction despite the fact that the market has continued significantly higher well beyond the cessation of the QE program.

Anecdotal and Other Sentiment Indications

“Markets are manipulated.”  “The only reason the stock market is this high is because of the Fed.”

Yes, I know.  We have all heard these reasons as to why the market is as high as it currently stands.  Most simply have not believed in the stock market rally, so they have been searching for reasons that “make sense” to them.  And, since they cannot find any reason based upon their fundamental perspectives as to why the market is so high, they simply default to “it must be the Fed manipulating the market.”

As for me, when I don’t understand something, it would push me to find a methodology which can appropriately explain why the market has acted in a way that most did not foresee.  However, I do not have to engage in such a search, as our methodology expected what we have seen years before it occurred.  So, clearly, I am not a believer in the “manipulation” theory bought into by the masses.

Now, I know that most of you who read this article are quite certain in your beliefs that central banks control it all.  But, if you actually open your mind to the potential that this is not really true, it may save you a lot of pain in the future.  Let me give you some issues with which the manipulation theorists would have to grapple, and are unable to explain, which “should” make you question your beliefs.

The best and most clearly obvious examples I can point to are in the Forex world. 

The Fed and The USD

For those who have been following my analysis since I began posting it back in 2011, you know that I do not buy into the common “market-think.”  In fact, when so many were looking for a dollar crash back in 2011, I was calling for a multi-year rally in one of my first public articles: