Is The US Government proppingup the US markets?
- Thread starter morse
- Start date
All I can say is that if they're proping up the mkt, they're doing a lousy job! 
The only institution that can "prop up the mkt" is the Fed and they have limited ability to do so. Not sure what you're thinking of here...
The only institution that can "prop up the mkt" is the Fed and they have limited ability to do so. Not sure what you're thinking of here...
Can't imagine how they'd do it w/o a "Deep Throat" somewhere finding out...
Plunge Protection Team
...Manipulation happens in the stock market on a daily basis..
...The PPT has enormous power and if it chose to make full use of that power it could certainly push the stock indices considerably higher. The Fed, a member of the PPT, has an unlimited ability to create dollars, so if it really wanted to the Fed could print enough currency tomorrow to buy the entire stock market. (There is, of course, a practical limitation to the Fed's currency-creating ability in that the more dollars it prints the weaker the US$ would become.) ...
http://www.kitco.com/ind/Saville/july052002.html
I think this link was also posted in this forum sometime earlier.
Josh
...Manipulation happens in the stock market on a daily basis..
...The PPT has enormous power and if it chose to make full use of that power it could certainly push the stock indices considerably higher. The Fed, a member of the PPT, has an unlimited ability to create dollars, so if it really wanted to the Fed could print enough currency tomorrow to buy the entire stock market. (There is, of course, a practical limitation to the Fed's currency-creating ability in that the more dollars it prints the weaker the US$ would become.) ...
http://www.kitco.com/ind/Saville/july052002.html
I think this link was also posted in this forum sometime earlier.
Josh
I remember that link, but I still find it hard to believe that they could get involved with equities w/o anyone knowing about it. But, hey, nothing about the govt surprises me any more. Plus, the way I look at it - they're just one more institutional player that would have only limited ability to break a trend. But it is an interesting subject.
On the night of August 5 a large German mutual fund "reallocated" out of bonds into equities. They bought an enormous amount of S&P futures through Morgan Stanley exactly when the trading was at its thinnest.
August 5 was a horrible day in the markets. Horrible news in the economy, all the indices dropped 2-3%, etc. When I went to sleep the futures were caving in and Japan was down 4%. When I woke up in the morning S&P futures were up 15 pts.
The German mutual fund story was told to me by two different sources on August 6:
a. a market maker at Morgan Stanley
b. a guy at Alger Funds who mentioned specifically that the S&P trade went through Morgan Stanley.
The market has not looked back since.
The question is: was this mutual fund following the bidding of the "Plunge Protection Team"? Were they acting independently? Is it even true? Who knows.
I do feel, by every method of measuring the market, the market was undervalued and grossly oversold in July and the first three days of August. Is it "better" now? Are we in a bull market or just a bull cycle in a bear market? Unclear. The momentum is upwards now but we know that could turn on a dime. My idea is to just buy solid companies with lots of cash, no debt, good yields, and growth, and all should be ok in the long run. Even if its a bit stressful along the way.
August 5 was a horrible day in the markets. Horrible news in the economy, all the indices dropped 2-3%, etc. When I went to sleep the futures were caving in and Japan was down 4%. When I woke up in the morning S&P futures were up 15 pts.
The German mutual fund story was told to me by two different sources on August 6:
a. a market maker at Morgan Stanley
b. a guy at Alger Funds who mentioned specifically that the S&P trade went through Morgan Stanley.
The market has not looked back since.
The question is: was this mutual fund following the bidding of the "Plunge Protection Team"? Were they acting independently? Is it even true? Who knows.
I do feel, by every method of measuring the market, the market was undervalued and grossly oversold in July and the first three days of August. Is it "better" now? Are we in a bull market or just a bull cycle in a bear market? Unclear. The momentum is upwards now but we know that could turn on a dime. My idea is to just buy solid companies with lots of cash, no debt, good yields, and growth, and all should be ok in the long run. Even if its a bit stressful along the way.
I think it was President Coolidge that said; "the business of America is business!"
My personal opinion is that the major players will spend (short term loose) billions to create a "bottom" and bring the public back into the game. Greed will again overtake fear and common sense and the public will provide the financing for business. If not for the public where would the money come from? Would they borrow it from banks? Can you imagine bankers loaning billions for the stupid assed internet plans we suckers bought stock in? Roflmao. They will not let the Goose that lays Golden eggs die. No way!
~EC
My personal opinion is that the major players will spend (short term loose) billions to create a "bottom" and bring the public back into the game. Greed will again overtake fear and common sense and the public will provide the financing for business. If not for the public where would the money come from? Would they borrow it from banks? Can you imagine bankers loaning billions for the stupid assed internet plans we suckers bought stock in? Roflmao. They will not let the Goose that lays Golden eggs die. No way!
~EC
Don't be fooled---the govt has and does do it.
