More Easing? Really?

With the markets on the edge of their seats in anticipation of the recent announcement of QE3 by the FED, it begs the question, should we really be getting more monetary stimulation?

While evidence demonstrates that the government bailout prevented a full fledged financial meltdown, the actual quantitative easing has not managed to stimulate anything more than a tepid, if not feeble, economic resurgence.

Small businesses remain crowded out while the big boys freeze or slow hiring until both the economic and regulatory environments become more appealing.

Pundits may be clamoring that the rally is banking on it, but banking on what? An artificial injection of cheap money? That screams dependency to me. The market's rally is dependent on help. In no way can that be a sign of a healthy market. So where does that leave us? Well, either we feed the beast or we let it adjust to life without handouts. Either way a big move happens one side or the other.

Don't get me wrong, I appreciate a nice rush into equities as much as the next guy. Infuse my LEAPS with lives of their own,I don't mind, but don't forget to set trailing stops. Up or down my LEAPS will be dressed in high delta tops with high beta bottoms. But I digress.

Personally, I think more easing will provide more of the same and simply hold off the bitter pill that is needed. I suppose there is some validity to the argument that we need to address our economic issues only once the volatility spillover from Europe becomes more positive, given the globalized nature of today's markets, blasé bla. But then, do we also wait for the BRICS, who are enduring slowdowns of their own? Maybe Bernanke knows?

Lets hope that for the sake of future alpha, Bernanke chose the right course.