You've got to remember that the market has been rising consistently on lower than average volume. Banning shorts would just diminish liquidity to a further extent, until the market would basically crawl to a halt. I don't even think this admin is that stupid, but who knows what they are capable of doing at this point ?? This artificial prop-up, though, is getting utterly ridiculous.
What you call an artificial prop-up (I am not suggesting there is not a subsidy in the markets) is best viewed as simply GENERAL CONDITIONS. These are the times we live in. This is the backdrop we trade with. Fighting general conditions (as Jesse Livermore would say) is a bad bet. I too think the market is overextended but that doe not mean I intend to short it Monday morning. Why be early?
Here is part of your enlightenment: First on November 25, 2008: Specifically, the Fed said that it would buy as much as $100 billion in direct obligations from the housing-related government-sponsored enterprisesâFannie Mae, Freddie Mac, and the Federal Home Loan Banks. In addition, it will buy $500 billion in mortgage-backed securities (MBS) backed by Fannie Mae, Freddie Mac, and Ginnie Mae. Second on Federal Reserve Bank of New York: On September 23, 2009, the FOMC announced that the Federal Reserve will purchase a total of $1.25 trillion of agency mortgage-backed securities and gradually slow the pace of these purchases, anticipating they will be executed by the end of the first quarter of 2010... CNBC Monday Jan 11, 2009 http://futurestorm.blogspot.com/2010/01/us-government-is-being-funded-by-shell.html â¦the Federal Reserve is not letting that happen. Instead they are swooping in and "buying" any treasuries that have not been sold at extremely low interest rates. In this way, the Federal Reserve is keeping interest rates at ridiculously low levels. You see, if interest rates on treasuries started to skyrocket, that would immediately cause interest rates on everything else throughout the U.S. economy to fly through the roof. If interest rates did skyrocket, there would be a massive cascade of mortgage defaults and personal bankruptcies and it would be an absolute death blow to the U.S. economy. So instead of letting the free market have its way, the U.S. government and the Federal Reserve are manipulating the markets in an effort to keep interest rates artificially low. But they can't do it forever. And they are making the long-term economic problems of the United States far worse. By flooding the U.S. financial system with cheap dollars, the U.S. government and the Federal Reserve may be able to prop up the U.S. economy for the moment, but they are also ensuring the death of the U.S. dollar. When you put more dollars into the system, the value of each existing dollar decreases. When you put gobs of new dollars into the system, the value of each existing dollar will ulitmately end up dramatically decreasing. The dollars that you are holding right now are never going to have more value than they do today. Someday when you wake up and a loaf of bread costs ten dollars, you can thank the Bush administration, the Obama administration and (most of all) the Federal Reserve for shoving the U.S. economy into the toilet. At this point, nothing can save the U.S. dollar. Use them while they can still buy you something. Because the day is coming soon when it may be cheaper to use dollars as toilet paper than to actually use them to buy toilet paper. And all of this money is finding its way into ... Bonds? Health Care? More treasuries? Creating Jobs? Guess where...
The fed is going to crash the US equity Markets (and all the other propped up brothers and sisters) a la 1987... bond yields are getting ahead of where the US wants them to be in order to support their own debt levels, and allow for its citizens to maintain an economy which is most functional courtesy high level of debt and low rates. The link doesn't exactly overlay my point regarding a bond market / stock event, but it shows that bonds lead stocks, and we are already seeing poor auctions in 10 yr treasuries for one. http://www.cherokeefilmfestival.com/Workshops.aspx
In my long term account, I began buying puts for <Sept> , I do think we are due some correction, 10-20 percent....
Rabbitone ... As I said in the post right before your arrogant lecture, those are simply general conditions. Easy to see and react to. A rigged market by definition is one in which participants are doing something surreptitiously. By your standard the housing market has been rigged for more than 50 years by home mortgage loan deductions. That's one of maybe a dozen examples one could find. The times we live in shape our view of markets. Here is what I said in the post you ignored: 04-03-10 03:55 PM What you call an artificial prop-up (I am not suggesting there is not a subsidy in the markets) is best viewed as simply GENERAL CONDITIONS. These are the times we live in. This is the backdrop we trade with. Fighting general conditions (as Jesse Livermore would say) is a bad bet. I too think the market is overextended but that doe not mean I intend to short it Monday morning. Why be early?
What I wrote was three quotes. Two from the New York Times and I copied the direct quote from CNBC. But you call me âarrogant lecturerâ based on their material? Tell me did you eat a lot of paint chips when you were a kid? http://www.telegraph.co.uk/finance/...s-Bernanke-shuts-down-his-printing-press.html By Ambrose Evans-Pritchard Published: 6:35PM BST 04 Apr 2010 ââ¦The US Federal Reserve has completed its purchase of $1.7 trillion (£1.1bn) of mortgage securities, agency debt and US Treasuries, the conjuring trick of "credit easing" that allowed Ben Bernanke to create stimulus equal to 12pc of GDPâ¦.â So you believe the fed generating 12 percent (out of thin air) of GDP is general conditions? Tell me what collor is the sky in your world?
They created 12% of GDP growth by using stimulus to prop the economy, its all an illusion yet so many still believe there is a recovery along the way.
or its actually working. do you really think the market would be this strong this long on an illusion? the market sniffed out this good news months ago that is why it has refused to pullback. do you think you have better insite than a market composed of millions of smart people?