Lowers Long-Term Interest Rates

• One of the quantitative easing steps taken by the Federal Reserve is to buy long-term U.S. Treasury bonds, long-term corporate bonds and other long-term assets. This reduces long-term interest rates on bonds. This, in turn, provides companies with the ability to sell long-term bonds at lower repayment costs. Companies sell long-term bonds to raise large amounts of capital for large projects.
  
  

Keeps Interest Rates Low Longer

• In addition to buying long-term securities, the Federal Reserve cuts its short-term loan rate to zero and announces that it will keep rates at zero well into the future. This causes banks to build cash reserves as they take interest-free loans from the central bank. In turn, theoretically, banks ease up on loan restrictions to corporations and the public (this wasn't happening in 2010-2011). Companies use loans to increase production and consumers use loans to buy products from companies, causing the economy to grow and corporate profits to rise.
  
  

Stimulate Exports

• As the government prints more money, the dollar becomes weaker relative to other world currencies. Dollar inflation makes products produced in the U.S. cheaper for foreign buyers. As a result, demand for U.S. products increases, allowing companies to sell more products to overseas distributors. According to Bloomberg, in September 2010, U.S. exports climbed to their highest level in two years.
  
  

Commodities

• When the dollar becomes weaker, commodities such as oil, gas, coal, steel, gold and silver, gain in value by comparison. This occurs because the intrinsic value of commodities remains unchanged while the value of the dollar shrinks. As a result, profits rise for mining, oil and other commodity-based companies. Rising profits, in turn, translate into higher stock prices for investors.