In a stunning turn of events this week, the Federal Reserve defied economists' expectations that the central bank would rein in quantitative easing. Expectations were for a $10-$20 billion reduction in the Fed's $85 billion-a-month bond purchasing program. Instead, the Fed vowed to continue buying bonds until additional evidence suggested that the economy was on a firmer footing.
I am not surprised with this course of action as Ben Bernanke has clearly stated in his writings and speeches that he strongly believes the Great Depression was extended by incorrect fiscal policy focused on tightening money supply. For that reason, we expect Quantitative Easing to remain alive and well for the foreseeable future.
(Read more: No Fed taper brings back talk of currency war)
This is not to say that interest rates are destined to remain low forever; clearly rates will rise as economic activity expands. The stumbling recovery playing out at present qualifies as economic expansion, and given that monetary agencies around the world are injecting billions of dollars into economies, additional progress appears likely.
For investors, the consequences of the Fed's stunning action include the following:
* Equity markets are likely to advance as rates remain low and companies benefit from discounted borrowing costs.
* Low rates mean a weak U.S. dollar and, in turn, higher global sales for U.S. companies selling to countries and corporations around the world.
* Fixed income assets will rally as investors recognize that fears over a massive increase in rates are overblown.
* Emerging markets will rally as concern fades that a rapid withdrawal of quantitative easing will siphon money out of emerging market economies
* Home sales and mortgage refinancing activity, which were beginning to face a headwind because of rising rates, will increase.
The Fed's action will have consequences for your strategy that you need to consider now; it really does matter to your long term investment success.
(Read more: The most important part of taper decision)
I'm always astounded when investment gurus suggest that one can invest without weighing current economic policies and macro conditions. In a world that is more connected than ever before, it's our view that global conditions make a huge difference towards investment success and the Fed's decision is one of the many factors to consider.
—Michael Yoshikami is the CEO and founder of the investment committee of Destination Wealth Management.