It’s obvious that via QE and the effects of substitution, the Fed has been indirectly funding equity purchases for a while, but are we to believe that central banks are themselves buying equities? If I recall, the Bank of Israel openly buys stocks and I wouldn’t be surprised if the Bank of Japan isn’t shy about doing the same, but there seems to be more of a stigma attached to the Fed and the ECB making direct equity purchases.
The broader implication is the question of how equity prices can be taken seriously when one side of the exchange is funded with a substance (fiat money) without bona fide scarcity.
I’m having difficulty inserting the hyperlink to the story, but it’s on ZeroHedge.com under the title “It’s Settled: Central Banks Trade S&P 500 Futures”