Looks like someone's flying back ATM. Realistically speaking, what can be done to pause or worse yet reverse the momentum back on the bullish side? How much interest rate cut will make you rethink the current trajectory? How real is the PPT "threat" I'm working under the assumption that this admin will not bee shy about propping the market. So feel free to go wild with your hypotheticals; this is mostly an information gathering thought experiment to make me raise an eyebrow when I see the news. https://markets.businessinsider.com...onavirus-rages-stock-market-2020-2-1028938046 How the Plunge Protection Team (PPT) Might Work On Monday, February 5, 2018, the Dow Jones Industrial Average (DJIA) experienced a drop that was twice as large as its biggest point decline in history. However, arbitrary and aggressive buying cut the decline in half in one day. On Tuesday and Wednesday of that week, stocks opened lower, and each time aggressive buying buoyed the markets. That aggressive buying, some say, was being orchestrated by the Plunge Protection Team. Or, to take a more recent example: The Plunge Protection Team's aforementioned teleconference on Dec. 24, 2018. That whole month, the S&P 500 had been heading towards a record decline—the motive for the team's meeting—and the DJIA dropped 650 on the 24th alone. But when trading resumed after Christmas, the DJIA rallied over 1,000 points. On the 27th, it lost half those gains, until a late-day reversal stopped the slide, and caused the market to close 600 points up. That's no coincidence, conspiracy theorists argue.
There is a lot the government can do through changing pension policy, which gives them another option to stimulate growth without the consequences the other economic policies have. See the links below. http://morganisteconomics.blogspot.com/2019/03/pension-pumping.html?q=pension+pumping http://morganisteconomics.blogspot.com/2019/03/optimal-pension-saving.html?q=optimal+pension+saving http://morganisteconomics.blogspot....-can-be-taken_8.html?q=optimal+pension+saving
The Fed can print more money.. then directly purchase securities to provide "buying support" to the markets... much as they have done in Japan.... which is reported to own 75% of the total ETF market. That's not only astonishing, it also has not been as effective as envisioned.
I don't think the government / Fed / etc will rush into this too quickly. With major spread in the USA now seemingly inevitable (see how the CDC are prepping the public for this) they need to keep the "bazooka" in reserve for when the crisis really hits here. China's radical mass quarantine measures and total economic shutdown of the affected areas has created a great deal of fear that the same thing will end up happening in NYC, Chicago and LA. The main thing at this stage is to see how things evolve in SK and Italy. If they end up being forced to duplicate China's policies (which seems fairly likely at this stage) then markets will stay weaker for longer. If it turns out to not be much of a hit to economic activity, then they'll recover more quickly.
"That's not only astonishing, it also has not been as effective as envisioned" Can you give the obviously short list of government actions that have had positive outcomes for the general population.
our last "the sky is falling" happened late last year, so just hang in there snowflakes the good feeling will come back sometime next month.
Yes in the United Kingdom they reformed pension policy to hit the economic targets better than any other time I am aware of, it made treasury cost efficiencies too. You can see the evidence at the Success page of my blog morganist economics.
Wow, OP is quite the drama queen and a well-known partisan poster. Stocks are down less than 10% from a huge series of all-time highs. No wild conspiracies are needed right now. Besides, the biggest gov't intervention was in the Obama era--it's not even close. The end of marked-to-market accounting (on almost the day of the 2009 bottom) Almost 8 straight years of ZIRP A big and hugely inefficient stimulus dump Obama's buddy Warren Buffett (world's biggest market cheerleader) getting involved and being a major TARP beneficiary Endless rounds of QE