US Treasury accused of manipulating markets - again?

Discussion in 'Stocks' started by slapshot, May 12, 2010.

  1. OK, let's assume for this discussion that there is at least some truth to the PPT aspect of USA equities.

    Charles Biderman from Trim Tabs went onto Bloomberg a few months ago and said that there were NONE of the 7 money flow characteristics of every other bull market in recent history.

    He pointed out that 80% of the rally's gains came in the post-market via futures buying during illiquid periods - when the market is a lot easier/cheaper to manipulate - and that arbitrage to this activity was the only thing that was driving equities higher.

    He said that the rally continuing as long as it had was flying in direct contradicton to the fact that institutions were net sellers of equities and that mutual fund outflows exceeded inflows.

    When asked directly who was doing the manipulative shadow buying, he said "I can't prove who is doing it - just that it is happening." Now, he is a pretty conservative guy and very well-regarded for his data. Not a radical or conspiracy type of guy.

    And certainly any rational person can see that the macro-economic situation of the USA in virtually all aspects - employment, housing, growth, etc. - has certainly not justified such a large rally. Even our own Gov. is blatantly changing how they count jobs and calculate GDP to cover up this miserable failure.

    So here is the theory: that if the Treasury or PPT has been doing most of the buying, then in order to "sell" their new Consumer Financial Protection Agency bill, the Administration needed a new crisis. That is why the market spiked down so hard, because there is no true liquidity or buying. And that all of the short-term trading folks that had been trading up with the "rally" suddenly decided to sell - volume was super-high on that plunge, like 9 times the average I thought I heard the t-heads say. And with no real public and/or institutional participation, there was nothing to hold up stock prices like real bids at thick levels, hence some stocks dropping to .01 - and NOW here comes the full-court press on this takeover bill.

    If you think this is insane, consider that the new health care bill had a shadow provision that allowed Uncle Sam to completely take over student loans with no debate - they really snuck that one by us, to very little outcry because it got lost in the debate about health care.

    Thoughts or comments?
     
  2. Your paranoia is justified. They're out to get you. :cool:
     
  3. dude i've been writing about this for years. yes its a rigged game that you can still win. just play the game and do what they do and learn to surf the waves as they come. your not going against the tide your trading with it.
     
  4. a5519

    a5519

    One of the main duties of the US Tresury is to manipulate markets. They must do their job.
     
  5. I have a theory too... I believe that Britney Spears is an extra-terrestrial alien and she is the one manipulating all the mkts.
     
  6. After she shaved her head, she certainly looked like an alien.

    You can argue that the Fed manipulates markets by keeping rates where they are. Free money to the banks, who do not lend with it, but put it into asset classes.
     
  7. I think you'll find that the banks actually deposit that money back at the Fed to earn their 25bps. Moreover, putting money into asset classes, is lending, innit?
     
  8. Uh, no. It's not.
     
  9. Why not? How are the two different? What is a bond purchase, for example, if not lending unsecured to the issuer?
     
  10. It does ultimately get you to the same place: either way its printed money/credit expansion.

    Back in the day, 'lending' to businesses etc. would result in price inflation. Nowadays it results in asset bubbles.
     
    #10     May 14, 2010