Come Again?

Stocks are up, so the nice people at Bloomberg, feel compelled to tell us why.  The fact is that a move of 0.50% is essentially a statistical non-event.  However, hand a couple of eager journalists the job of "explaining why" and they will dutifully call everyone they know until they come up with a reason.

So Ms. Nazareth and Mr. Kearns, who apparently are stuck with this no-win situation at Bloomberg,  publish the following treatise titled: U.S. Stocks Advance as Fed Says Policy Makers Wanted More Stimulus Action

Right from the title I get lost:  "Policy Makers Wanted More Stimulus Action?" Wait! Aren't these people empowered to take action? What kept them from taking the actions they wanted to take? How has this changed just because we can now read it in the minutes?

In a vane attempt to quench my thirst for meaning, I read on:

“You still have the Fed in your corner,” Mark Foster, who helps manage $500 million at Kirr Marbach & Co. in Columbus, Indiana, said in a telephone interview. “That gives you confidence in a market like this especially after the volatility we’ve seen in the last few weeks, which was so unsettling.”

As opposed to what Mr. Foster? Is there any chance that the Fed would not be in your corner? (I assume he means the money manager's corner).  Do you think the stock market (Note to naive reader: when this guys say market, they mean stocks) sold off because the Fed was no longer in your corner? The rest of us thought it had to do with the US economy slowing down and, more importantly, proving that QE2, measured by housing, employment,  and GDP, did not work, in addition to the credit problems in Europe.  Apparently, it was just a case of the Fed not showing enough commitment to the stock market.

I keep reading more reasurances about the Fed having everything under control and then, to my surprise, I run into this:

The S&P 500 slumped earlier after the Conference Board’s index of consumer confidence fell to 44.5, the lowest level since April 2009, from a revised 59.2 reading in July, the research group said. It was the biggest point drop since October 2008. Economists predicted the gauge would fall to 52, according to the median forecast in a Bloomberg News survey.

Wait! Shouldn't the market trade down on something like this? Haven't we heard ad nauseam that the US Economy is 70% consumption? How come the market ignores this fact and chooses instead to focus on the Fed minutes from Aug 9th? The market discounts six-months into the future, some evangelist of the market efficient persuasion yells from the other room.  Really? I guess that means some great event will happen six months in January 2012 (six months from now in case you don't want to count).  In fact, it will happen and not happen and then happen again since our sacrosanct oracle has made several U-turns this month.   Come to think of it, I hope these U-turns don't mean the market doesn't really know.  That would be devastating to the American psyche.  We can tolerate wars, terrorist attacks, a depression, and several bad presidents, but to accept that the market is not efficient and that it often moves randomly or capriciously based on emotions rather than future tangible results would be a national disaster.