It is important to understand that the Dow is moved by people who thought that Bernie Madoff is a genius and that Pets.com was worth tens of billions of dollars. And, they somehow could not see an $8 trillion housing bubble right in front of their faces.

The people who move markets are not people with a deep understanding of the economy or anything else. It would be absolutely crazy to try to run economic policy based on the peculiar quirks of the Wall Street crew.

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