"Your guide to the next 12 months":
Everything changed March 18 (at least for the short run; in the long run, probably not quite so much). That's the day the Federal Reserve announced it would buy $300 billion of U.S. Treasury notes.
There's nothing subtle about this: The Fed is printing money in order to stimulate the economy.
At least that's the theory. Over the next year, we'll find out if the real economy responds to theory. But in the short run, the Fed's move has had powerful effects.
It sent the U.S. dollar lower against the euro by 3.2% and the yen by 2.3% as investors anticipated that lower U.S. interest rates and higher U.S. inflation will result from adding $300 billion to the money supply.
Gold rallied, jumping 6.6%, as did oil and, indeed, just about every commodity and every stock linked to a hard asset.
The effect was so strong that on March 19, as the indexes fell, commodity stocks rallied, with investors snapping up commodity stocks as hedges against inflation.
