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Welcome to the "Wolf Creek Pass" School of Monetary Policy

I don’t know if you folks remember that hit ditty: a humorous tune about two truckers attempting to manhandle an out-of-control 1948 Peterbilt down the “other side” of Wolf Creek Pass – a death-taunting section of U.S. Highway 160 where the elevation drops a hefty 5,000 feet in a relatively short distance.

The song’s two characters – a truck driver named Earl and his brother, who’s his partner as well as the song’s narrator – are taking a flatbed load of chickens on a speedy trip down this winding, two-lane Colorado highway. After the narrator gives Earl the above-mentioned warning, the ancient semi’s brakes fail.

From there on down, the narrator tells us that the brothers’ trip “just wasn’t real pretty.” The truck careened around hairpins and switchbacks, and then raced at an uncontrolled 110 mph toward a tunnel with “clearance to the 12-foot line” – with chicken crates sadly “stacked to 13-9.”

The drivers and the runaway Peterbilt “went down and around and around and down ’til we run outta ground at the edge of town… and bashed into the side of the feed store – in downtown Pagosa Springs.”

Believe it or not, I started thinking about this funny old country tune the other night – right after I’d read a piece about QE3 and the U.S. Federal Reserve.

As zany as it first sounds, the parallels are striking.

  • Alcoa (NYSE: AA) Kicks Off First Quarter Earnings Reports That Could Put Brakes on Market Rise Investors will get a front row preview to the first quarter earnings season when bellwether Alcoa Inc. (NYSE: AA) reports its results Tuesday after the close.

    The aluminum producer is the first major U.S. company to release its first quarter earnings report, and these closely watched results often set the tone for the earnings season.

    But investors shouldn't get their hopes up - expectations for first quarter earnings are low.

    Earnings growth for the first three months of 2012 was lackluster at best - even though the stock market produced some of the best quarterly market gains since 1998. The Dow rose some 8%, the Standard & Poor's 500 Index gained 12%, and the NASDAQ nearly climbed a whopping 19%.

    If this latest batch of earnings comes with a plethora of nasty and unwelcome surprises, the recent market rally could be derailed.

    Sam Stovall, chief equity strategist at S&P Capital told the Associated Press, "It's supposed to be a very weak quarter, but Wall Street is freaking out because they don't understand why."

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