The Fed is playing an interesting game. One the one hand, rates must remain low to fight deflation, encourage borrowing and keep the economy moving slowly forward. On the other hand, rates must eventually rise, but the Fed is also terrified about a steep sell-off in the stock market. Not only would a sell-off undermine consumer confidence, lower stock prices might leave banks in a precarious position due to toxic assets still on their balance sheets.  

How high do we think the Dow can run? I’m sure we’d all like to see recent losses reversed. But that fact is, our banking system has changed in ways we don’t yet understand, we’re in the early stages of a global recession that could send American unemployment through the roof, and given recent earnings estimate adjustments, the S&P 500 trades at a not-so-cheap-anymore 17X earnings.