here is a very good read...

All of a sudden, I love Ben Bernanke. This past week when the FED surprised the market and lowered the discount rate by one half point, the whole game changed. It's blast off time.

It's amazing how quickly the rhetoric changed out of the talking heads in the media spotlight. On Monday, the "R" word was plastered all over CNBC. Here's how the argument goes. The lack of liquidity in the system has forced banks to raise mortgage rates. The gigantic raft of foreclosures in the exotic, sub prime mortgage market was causing a meltdown. It's a proverbial hang over from the last housing boom.

This massive bubble of mortgage death, along with a very slight increase in the unemployment rate, was going to send the US consumer to the sidelines, thereby causing a RECESSION (the "R" Word). Earnings would then fall apart, and the market would follow suit.

Here's what cracks me up- on Wednesday, one day after the FED's move, there was a new bunch of talking heads out there spewing forth the "new" problem. On Monday it was falling property values and "deflation" or "disinflation". On Wednesday, the "I" word was being bandied about by every market genius capable of getting his or her mug front and center in the media. "I" stands for INFLATION- INFLATION is going to destroy our economy now- after all, gold and oil are both pushing to new all time highs. It's going to be 1979 and Jimmy Carter all over again.

Not, it's not- it's more like 1998 all over again. However, this time it's without AOL trading at a PE of 200 or JDSU with a PE of 700. It's the S&P 500 trading with a PE of 15, and forward looking operating profits over $100 per share.

Bernanke's move sets us up for a whole new game in the market. Look for major PE Expansion over the remainder of the year, more aggressive earnings forecasts, and stocks breaking out. Large caps will be first, followed by smaller names as money starts to flow down to stocks that haven't moved in a while.

This next leg up in this bull market could be the strongest. This could make 1998 to 2000 look weak- why?- one word- Globalization. There is more money chasing less ideas on a global basis. There's more demand for goods and services than there has ever been. There is more expansion capability thanks to emerging markets. We're starting from much more reasonable valuations.

Tuesday was a complete game changer. Sure, we'll have some non-believers whining about inflation, the falling dollar, and rising oil prices. Don't listen. Once again, the doom and gloomers will end up with egg on their faces.