The goal to US economic policies is simple: make things cheap and everyone has a job...means low unemployment rate and low inflation. Everything they do is trying to achieve these two goals. The Fed and the US Government is concerned with the US companies to make money or for the stock price to go up only to the extend that it helps them to achieve these two goals. Since the uprising of the stock market usually help lower the unemployment rate, Fed would not want to see stock market goes down by so much.
On the other hand, Fed also do not want to see inflation. In other words, Fed would like to see the stock market goes up because the "Value" of the stock goes up not because the stock is simply getting expensive(that's inflation). With the value of dollar gets very weak and oil gets expensive, EVERYTHING is going to cost more against dollar, including those stocks traded in dollars.
I think US is going to see inflation over next three months. And I do not believe that FED will have the guts to cut the interest rate more.
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