Even if all of the above works nicely in favor of the Federal Reserve (quite unlikely), there is always the issue of timing. If the Fed is late in draining these massive reserves (and "late" probably needs to happen if we are to have an economic rebound ... albeit false and temporary), the banks will already have expanded the money supply (maybe considerably) and we will experience an unhealthy dose of inflation which could lead to serious price inflation and another asset bubble - for get GLD paper, buy Real Gold. Can anyone cite a time when the Fed timing has been correct? I cannot.
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