Fed facing a dilemma

walmart results hit a death knell into dow, dow looks peaked out for now, in line with my earlier forecast on dow.

check here for walmart's chart:
 http://finance.yahoo.com/q/ta?s=WMT&t=6m&l=off&z=l&q=b&p=&a=&c=
you will see the stock is being unloaded over two round tops and sure to go down further.

we all heard of us economy picking up, but walmart is telling us a different story, the general public is not buying at its stores, why?

with food, fuel and utility costs all gone way up in the past few years and still not much rise in pay, the general public has to cut back on its spending, even at walmart.

fed's continued qe has caused food fuel and utility costs gone way up though the housing and stock markets have also zoomed, but the wealth effect has only generated spending from a small part of the population, the larger general public is squeezed in their budget for basic living and have less to spend elsewhere.

the recent labor unrest at McDonald is a good case in point, those are the people who can hardly live a decent life with all basic costs gone up so much.

would fed continue her qe?

if she does, then there will be more labor unrest, housing and stock markets will shoot through the roof, many stocks may suffer from declining revenue because of inadequate or squeezed spending.

if she doesnt, then house prices will reverse its current trend. stock markets will tank or suffer serious corrections denting spending of the even small part of the population who has enjoyed the recent rise in house and stock markets.

let's see how fed can strike a balance without causing too much shocks to the market.