Stocks have moved dramatically on the "bad is good" theory of investing in recent weeks. That theory states that more bad news will motivate the Federal Reserve to go to QE3 and inflation will be the result, driving equities and other assets higher. The flaw in that thinking is that investors simply don't understand what QE actually does and why additional QE will not have any impact. To assume that QE3 will work to expand money supply and regenerate inflation is a flawed assumption. Investors who are basing their investment decisions on QE3 are going to be disappointed. A little refresher course on Money and ... (full story)