The markets have long had quantitative easing to back stop them. Mentally, the markets and investors always knew the Fed was printing money and putting major support under any sell off. This worked as a self fulfilling prophecy, helping every dip be bought. As of last week, quantitative easing has concluded. The major concern now is that the markets are insanely inflated and when the next dip comes, investors will remember that the Federal Reserve is no longer back stopping the markets. This may mean panic and major selling could continue, creating a crash like scenario. While every past dip was bought, investors always know the Federal Reserve had their back. Now the average investor understands the Fed is no longer there. A small pullback may trigger a much larger crash like market correction.

Gareth Soloway

InTheMoneyStocks