Friday highlighted once again the importance of maintaining a long bias to stocks at least for now in an investment portfolio regardless of your long-term outlook for the global economy and its markets. In a surprise revelation, the Bank of Japan announced that it was raising the stakes on its already unprecedented monetary stimulus program. In short, they have essentially decided to push the accelerator even further through the floor. The stakes are higher than ever with this latest policy move, and the stability of the global financial system may ultimately hang in the balance. But such are worries for another day apparently. In the meantime, it is worthwhile to consider the sustained near-term impact on global financial markets, including both U.S. and Japanese stocks.
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