September 2014

Quantitative Easing comes to Europe - European Central Bank

Announces new Money Printing Program



The European Central Bank just announced a massive new stimulus program. Concerned about the
stagnant economy in many of the Eurozone nations, the ECB will start a Quantitative Easing (QE)
program next month, buying as much as 40 Billion Euros of asset backed bonds in an attempt to
increase inflation and spur the economy and employment.
http://www.reuters.com/article/2014/09/04/us-markets-global-idUSKBN0GX01P20140904

Quantitative Easing comes to Europe - European Central Bank Announces new Money Printing Program
Gevers Wealth Management, LLC
September 2014
Page 2

Why is this Important to Me?

The US Stock market soared in tandem with the Federal Reserve QE programs that started in mid
2009. QE is a form of money printing, and is a government manipulation of the money supply and
markets. (For a more complete explanation, please see our client letter, QE3 What Does it Mean to
Me And what is Quantitative Easing Anyways! http://www.scribd.com/doc/106570139/QE3-What-Does-
it-Mean-to-Me-And-What-is-Quantitative-Easing-Anyways-Gevers-Wealth-Management-LLC

Fed domestic money printing programs have increased the monetary base in the US by five fold since
its inception. QE is widely credited with the US stock market jumping over 100% since QE started; a
10,000 point move in the price of the Dow J ones Industrial Average.


www.financialsense.com



Investors will remember that global stocks although generally providing positive returns, have lagged
behind US stocks now for quite some time. QE like this program, and at this scale, has never been
done in Europe before.

Quantitative Easing comes to Europe - European Central Bank Announces new Money Printing Program
Gevers Wealth Management, LLC
September 2014
Page 3


In our May client letter I wrote that:



Will QE in Europe have the same impact on global/euro stock markets that the Feds QE has had on
the US stock market? There are no promises or guarantees for the future, and Europe has different
economic challenges than we face here however investors and Wall Street are very optimistic about
the potential beneficial effects. We will be watching our international stock allocation closely in the
coming months.

Does QE Work?



It is clear that QE has boosted asset prices like stocks and real estate. The big question is what will the
long-term ramifications of QE be? Unfortunately no one knows the answer to that. Current QE
programs, as well as the accompanying levels of government debt are unprecedented in economic

Quantitative Easing comes to Europe - European Central Bank Announces new Money Printing Program
Gevers Wealth Management, LLC
September 2014
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history. No one living (or dead) at the Federal Reserve, ECB, Bank of England, IMF or BIS has any
experience or past history to guide them in making these decisions. Lets hope and pray for wisdom for
their choices.

We are living in a global financial experiment. As investors we need to continue to diversify widely,
especially against unknown/unforeseen risk, be constantly refreshing our liquidity and income needs,
and try and understand the level of risk in our portfolios.

I hope all of you had a great summer and had lots of opportunity to enjoy the wonderful weather. Here
in Seattle we gloried in the warmest temperatures in recorded history for J uly and August. The Gevers
family enjoyed our typical outdoors adventure themed activities; mountain biking, river rafting, fly
fishing, BBQs, and sleeping on our deck under the stars were all part of our summer. We are refreshed
and reinvigorated, and looking forward to our next review meeting with you.

Warm Regards,


William R. Gevers
Financial Advisor




Gevers Wealth Management, LLC
5825 221
st
Place SE
Suite 102
Issaquah, WA98027
Office: 425.902.4840
Fax: 425.902.4841
Email: wgevers@geverswealth.com


Quantitative Easing comes to Europe - European Central Bank Announces new Money Printing Program
Gevers Wealth Management, LLC
September 2014
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The views are those of Gevers Wealth Management, LLC, and should not be construed as individual investment advice. All information is believed to be from reliable
sources; however, no representation is made as to its completeness or accuracy. All economic and performance information is historical and not indicative of future results.
Investors cannot invest directly in an index. Please consult your financial advisor for more information. Securities and advisory services offered through Cetera Advisor
Networks LLC Member FINRA/SIPC. Cetera is under separate ownership from an any other named entity.

PS: We have been repeatedly asked by clients if they could share these e-mail notes with their friends or neighbors. Please
feel free to forward this with the stipulation that it may only be forwarded if done so in its entirety with no portions omitted.
We would be delighted to share our comments and opinions with your friends, and welcome your comments and feedback.
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Copyright 2014 William R. Gevers. All rights reserved.


US Money Supply, US Dollar, and Inflation/Deflation Watch

"Neither a wise man nor a brave man lies down on the tracks of history to wait for the
train of the future to run over him." - Dwight D. Eisenhower


US Money Supply Adjusted Monetary Base

(http://research.stlouisfed.org/fred2/graph/?s%5B1%5D%5Bid%5D=AMBNS#)





Quantitative Easing comes to Europe - European Central Bank Announces new Money Printing Program
Gevers Wealth Management, LLC
September 2014
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US Dollar Price (DXY) USD Index Measured against Other Currencies


(http://barchart.com/chart.php?sym=DXY00&style=technical&template=&p=MC&d=H&sd=01%2F01%2F20
00&ed=&size=M&log=0&t=LINE&v=1&g=1&evnt=1&late=1&o1=&o2=&o3=&sh=100&indicators=&ad
dindicator=&submitted=1&fpage=&txtDate=#jump)























Quantitative Easing comes to Europe - European Central Bank Announces new Money Printing Program
Gevers Wealth Management, LLC
September 2014
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Inflation/Deflation -Year to Date Price Increase in Commodities and Basics as Measured by
Futures

(http://www.finviz.com/futures_performance.ashx?v=17)



Quantitative Easing comes to Europe - European Central Bank Announces new Money Printing Program
Gevers Wealth Management, LLC
September 2014
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Velocity is a measure of how quickly money is spent. High velocity is typically a precondition for inflation.

(http://research.stlouisfed.org/fred2/series/MZMV)