It's about time someone else chimed in. I was just about at wit's end. Were MrChips and I the only ones reading this thread for the last 12 hours?

 

Ron, I concede, you're right.

 

MrChips, if I sounded like I was attacking you, I apologize. I was frustrated, but my intent was to keep our OP and any other novices from being misinformed.

 

I try not to argue with people who know more than I do.

 

AC does not pass through the Re bypass capacitor.
The capacitor holds Ve at a constant voltage and hence eliminates the negative feedback.

I may have misunderstood the Op's last question. I was assuming he was asking how AC current could flow through a capacitor and DC not flow. I assumed he meant in 'any' capacitor, not the one in his circuit. Sorry for any confusion.