Mention that the Fed may have been engineering equity price outcomes in polite company and you will be scorned as a wacky conspiracy theorist.   Earlier this month, the people at Trim Tabs went public with the observation that they could not see where the money flow was coming from to explain the 2009 rally, and suggested maybe that the "plug" involved the Fed.

The Contrary Investor, a subscription site I gladly pay for year in and year out, put up an intriguing and well argued piece last night that shows how this "plug" might have worked.  In short, the Fed conveniently times its MBS purchases for option expiration week, liquidity provided therein to TBTF banks goes to their prop desks, up go equity markets. Repeat each month.

Stabilize the housing market, get 201(k)s back to 301(k)s, and we will be in the clear.  It certainly seemed to be working.  Oddly, the resentment against GS prop desk profits may in fact reflect deep-seated public resentment against the stock market ramp, which retail investors have not embraced.  Do they know it is "fake?"