Stock Market News Today: Unraveling the Mysteries of Profitability

Decoding Stock Market News Today: The Path to Profitability

Updated July 2024

Before you even think about taking stock market courses, it is imperative to understand that free-market forces ceased to exist long ago. Suppose you know that simple principle. You will realise that most of the material in these stock market courses being marketed to naive investors is even worse than rubbish. At least rubbish can be recycled; the paper used to print this gibberish might be helpful to start a big bonfire.

In most cases, the experts behind these books do not know anything about investing but have a master’s in fiction and should thus focus on dealing with fictional events.  What we decided to do today is post an extended essay on the topic of market manipulation. If you understand what it is and how it’s utilised to separate the masses from their money, the information you glean from this will be ten times more useful than that you could ever hope to obtain for a series of stock market courses.

Stock market news today: Forget the News. It’s akin To Rubbish.

Instead of discussing the News factors, let’s examine market manipulation. It’s natural and exists. It’s neutral, neither good nor bad, and, in a twisted way, necessary.

Let’s start by looking at a predator in the wild: a Jaguar. When there is plenty of food, all the Jaguars can feed well and relax, as there is plenty to go around. However, it seems unfair if one looks at the situation from the prey’s side.

The deer are just trying to get a drink of water or eat some grass, but each time, it has to play Russian roulette with its life. If the Jaguar were eliminated, you would have too many deer, resulting in overgrazing and severe constriction of the existing food supplies.

So, the Jaguar needs to maintain equilibrium. If the number of Jaguars suddenly goes up, we have another imbalance, and the existing food supply is threatened (there is not enough deer to feed all the Jaguars). Once again, nature intervenes, and the weakest Jaguars die off; only the strong ones remain.

Random Stock Market Reflections

Before we continue, let’s deviate for a second

On a separate note, acquiring a firm understanding of technical analysis holds tremendous significance, as it empowers individuals to identify market turning points and navigate the complexities of crowd behaviour, herd mentality, and the bandwagon effect.

These psychological phenomena can significantly impact investment outcomes, often leading to adverse consequences. By incorporating the principles of Mass Psychology into your investment approach and embracing contrarian investing, you can mitigate the risks of blindly following the crowd.

This comprehensive strategy helps you avoid succumbing to the emotional biases that can cloud judgment and instead make informed decisions based on objective analysis.

 

Applying the above analogy to the markets, we get the following:

The masses are the Deer; they want to find a way to grow fat without doing much. Even worse, they want to build lots of money for a time when they least need it. This period is called retirement. It is incredibly amusing that everything is sacrificed, including good health, youth, pleasures, etc., to put money aside for a time when practically nothing works as well as it once used to. If the masses are so happy to kill themselves slowly, why should it be terrible when the predators come in and do the same job but 100 times faster?

The Jaguars represent a few sophisticated investors, big brokerage firms, etc.

Their function is to wait and watch the deer (masses) get nice and fat; then, they strike their fatal blow. In this case, the markets crash when the herd is net long or suddenly take off when the masses are net short.

Then you get times when the food supply is thin, and even the Jaguars are now threatened as they turn on each other to survive. (By the way, this has been happening in the markets for the last few months). This is when you see big companies go down (Long Term Investment Capital is an example.), and many big investors suddenly find themselves penniless. The Jaguars that survive this period of hardship emerge even more potent, and leaner and will feed ten times as much as soon as the food supply is replenished to equilibrium levels.

Taking it one step further, in the good old cavemen days, we had to worry about wild animals attacking us, and either we killed them or were killed in the process. So perhaps the markets are just an extension of the kill-or-be-killed lifestyle our ancestors were once subjected to and whose genes we still carry.

Fast forward:

Instead of hunting or defending ourselves against wild animals, we are now hunting each other because the amount of food there is limited. So, the only way to survive is to keep the masses fat and stupid. Thus, when the fatal blow is delivered, predators will have ample food in the coming winter.

Stock market news today: The Markets Are Manipulated

When everyone screams that the markets are manipulated at the top of their lungs, they seek someone to come in and ensure everyone wins. In this case, it’s just another form of socialism as everyone will remain thin and not feed well.

We all know nothing is fair in life, and that in most cases, it’s not your studies but a matter of who you know that helps you climb the ladder. As the number of participants increases, so will the so-called level of manipulation because even more individuals are now competing for the same food supply. Ultimately, this ratio is king; 90% must and will lose to sustain the remaining 10%.

This ratio will never change; no amount of whining or screaming will help you. The only escape is to become a predator or perhaps a parasite and ride on the back of the predators.

Stock market news today: News won’t Save you, But Education Could

Some examples of manipulation and how we keep quiet about them:

1. Being fooled into believing that one must do everything possible to save for one’s retirement. In other words, give up the best years of your life to try and enjoy the worst years of your life.
2. Absorbing all the rules that come with your culture. Were you allowed to study the laws in several cultures and then come up with your set of rules?
3. Being told that working like a dog from 9 to 5 pm is the right thing to do and that doing that for 30 years plus is what life is all about.
4. Being told that higher education is the key to everything, in many cases, this higher education is actually the worst one can receive. However, along comes Tom, the neighbourhood idiot, and oh, his Pa just happens to know the CEO of IBM. Tom now has a six-figure income and drives a top car while you slave away after graduating with honours.
5. You are being told that the American dream is to buy a house with a 30-year mortgage strapped around your neck to give you the illusion that you own the place. If that same money were to be invested in an investment yielding 5-8% yearly, you would be far better off.

Conclusion

A market can be a dangerous place for novice investors. Despite knowing that most people lose, many still enter with the hope of striking gold. Without educating themselves, they enter with their innocence or stupidity, thinking they can take on seasoned predators. But when they get bitten, they scream. There are two options: either stay out and live a safe life or jump in, but do so knowing that you will be attacked several times and will most likely lose the first couple of rounds.

However, if you spend time educating yourself before and while going through those painful experiences, you can emerge victorious. Every war is just a composition of battles; sometimes, one has to lose several fights to win. So, the next time you feel like screaming, redirect this wasted energy to your brain and sit down to work on a plan. This way, you might find a way to join the winners.

Now, let’s demonstrate why market manipulation is inconsequential. All you need is a pencil, ruler, and some understanding of trend analysis. You have to spend some time learning this concept. However, it is straightforward, and in the future, we will provide some free lessons on our site.

Let’s look at the most manipulated market in the world: The Gold Market.

Source: www.prophetfinance.com

If you are familiar with fundamental trend analysis, all the nonsense about manipulation can be put to rest with a pencil stroke. The red lines represent downtrend lines, and the grey ones represent uptrend lines. So, if you look at the last hyper-bull phase, you will see two grey trend lines; one could have sold or shorted the gold markets when either trend line was violated. By the way, we are using monthly charts; if one uses weekly or daily charts, the moves can be timed even better.

Go long gold in 1977, sell at the end of 1980 or the end of 1981 when the main uptrend line was broken.

Go long again in the middle of 1982 and sell around the beginning to middle of 1983. Go long in 1985 and sell 1988. Go long in 1993 and trade in the middle of 1996. Go long again towards the end of 1999 and sell in early 2000. Finally, hold until the end of 2001 or early 2002. However, we might be close to generating another sell signal.

If you do not know trend analysis, this will look a bit difficult, but remember you cannot play any game without learning the rules. Trend analysis is not that complex to understand, and if you are going to play in one of the most dangerous areas in the world, you owe it to yourself to spend more time learning and less time whining.

It is by the fortune of God that, in this country, we have three benefits:
Freedom of speech, freedom of thought, and the wisdom never to use either.
Mark Twain 1835-1910, American Humorist, Writer

George J. Paulos
Editor/Publisher
Alternatives for Financial Freedom
Proprietor, www.freebuck.com
Editor, The Gold Letter

 

Stock Market News Today & Market Manipulation

I have always been intrigued by the similarity between “economy” and “ecology”. Both words are based on the same Greek root “Oikos” which means house, implying that the ecology and the economy are environments we live in. These two environments have other similarities. They are both complex and chaotic systems with a myriad of interrelationships. Both environments are inhabited by humans who are subject to their forces. They are both only dimly understood by science yet actively manipulated by people. Our ecological and economic environments are often hostile and unforgiving.

So, we attempt to tame our surroundings.

It is natural for people to re-engineer their environment to make life more pleasant and predictable. We spray swamps to eliminate bugs, we dam rivers to prevent floods, and we manipulate currencies to protect our domestic businesses. All these activities are intended to promote better living, but they all have secondary effects that may result in a crisis.

Many environmental activists fondly recite the old saying, “It’s not nice to fool Mother Nature”, implying that interfering with the natural order of ecological relationships is courting disaster. In an incredibly complex environment such as an organic system, it is almost impossible to manipulate just one separate component because all components are dependent. The alteration of one process may lead to cascading effects in other processes previously believed to be independent. Chaotic systems often react this way, leading to unintended consequences when interventions are attempted. These results can be witnessed in the continuing high rate of species extinction and global warming.

Economic systems are remarkably similar to ecological systems.

Both systems are Darwinian in their natural form. They promote strong individuals and communities by weeding out the unfit. They evolve to create more complex and specialised organisms that fill specific niches. Economic organisms are called businesses. They form and grow to meet society’s changing needs. Businesses are most effective when they are left to pursue their interests without interference from the authorities. But totally free economies can be brutal places. The marketplace is unforgiving of failure.

Stock market news today: Virtually all societies regulate their economies in one way or another.

Most of this regulation is in place to ensure that no single individual or community will unduly experience the brutality of the free marketplace. Subsidies, tax policies, unemployment insurance, and many other regulatory tools are used to smooth out the economic bumps and promote egalitarian outcomes. Over time, these policies lead to unintended consequences that make economies less efficient.

Financial markets can be considered the “virtual” economy. Stocks, bonds, commodity contracts, and currencies are not the economy, but they represent economic entities and exhibit the same Darwinian nature. Financial markets are also highly regulated and manipulated for ostensibly the same reasons as economies. Lock limits, circuit breakers, trading halts, short-sale rules, and many other market manipulation tools are in place to smooth the bumps and protect investors from the dreaded market crash. Unfortunately, many of these measures also lead to unintended consequences by mispricing securities and encouraging excessive risk-taking. In other words, market intervention makes markets inefficient.

All of the economic and market manipulations listed above are overt.

They are conducted in plain sight of all participants and are subject to strict rules. Because of this transparency, it’s hard for market players to gain an advantage by using them. However, many manipulations are conducted covertly without public disclosure. When critics talk about “market manipulation,” they usually refer to these covert activities. Manipulation efforts such as Plunge Protection Teams, gold leasing, and other activities are conducted secretly to produce desired outcomes that are in the authorities’ interests.

These covert market interventions are the most sinister and harmful to the markets. Since they are not publicly disclosed, there are no strict rules on how these manipulations are conducted. This gives market players who have access to the intervention a tremendous advantage. Market participants will ultimately discover any widespread market intervention. If the authorities continue the charade, participants will start believing that the markets are “rigged” and unfair. Such a loss of faith would be the equivalent of market pollution, easy to spoil but challenging to reclaim.

There is a vigorous debate about whether such covert market manipulation is occurring.

Anecdotal evidence is building to support the accusation of widespread market intervention by government authorities and large institutions. Many investors now talk openly of the “Greenspan Put”, referring to the belief that the Federal Reserve, in conjunction with market authorities, is actively supporting the markets with monetary policy or direct intervention. I believe we are starting to see the effects of such covert policies on all financial markets. Government actions essentially dictate currency markets. Bond markets tremble under the threat of Central Bank purchases. Precious metals sag under the constant influx of supply by overt government sales and covert leasing. Stock markets anticipate the big anonymous buyer in the futures pits who places support under prices when the markets dive.

In all of these markets, the primary object of investor interest

is supposed to be the condition of earnings, interest rates, inflation, or supply and demand. However, with many of today’s investors, the primary focus of interest is the timing and intensity of interventions. Because of this, we see pricing in many securities that make little sense. There are always mispriced securities, but this seems to be the rule these days rather than the exception. The goal of manipulation appears to be to maintain the current pricing structure and avoid the consequences of a dramatic repricing event.

It would be overstating the case to blame all market inefficiencies on market manipulation, but volatility and pricing are at historical extremes in many markets. Any market movement to correct these extremes seems to be mysteriously averted. Could this be the invisible hand of manipulation? I believe that, in some cases, it is. However, in the long run, market manipulation schemes will always fail. The market is more significant than the participants, including the authorities.

© 2004 George J. Paulos
Editor/Publisher
Alternatives for Financial Freedom
www.freebuck.com l The Gold Letter l

s.

Stock market news today: Views From John Tyler

Is The Market Manipulated?

There is no doubt that the market is manipulated. However, the greatest obstacle is our fear and greed. Market manipulation, defined as moving the market other than buying and selling shares, is part of the market, has always been, and shall always be!

When Dow theory was being formulated, it was a major principle that the significant trend could not be manipulated; this probably still holds as regulators seek to curtail and penalise the most blatant forms of market manipulation and inventiveness to circumvent these increases.

We should ask, is all manipulation bad? If we believe that malevolent forces are at work, we can assuage our sense of inadequacy. There is someone else to blame for our lack of success.

Manipulation can serve many ends. I have argued that the US dollar is pushed up by the BIS and the G7/G8 cabal (see ‘The Secret Oil Rescue’), and no cogent evidence has been advanced to contradict this view.

The evidence continues to mount in support of this!

The first chart looks complicated, but it only compares the oil price to some currencies. When oil prices climb, we see a shift in various inter-currency relationships. This occurs in the face of basic market fundamentals (one of the typical hallmarks of manipulation), leaving some form of market manipulation as the cause.

Period A to early April 04: stable oil-or so it appeared- we had observed the HUGE backwardation in the far oil contracts, showing a tightening of supply. The Yen is rising at the expense of the Euro.

Period B to late May 04: oil breaks out, and the $US Index gives two hard pushes at the expense of all other currencies.

Period C to mid-July 04: it looks like the fight against rising oil prices is won, and the other currencies revalue against the $US

Period D to present: oil breaks out and the $UD is pushed up against all other currencies again!

Sometimes we need more sophisticated methods to see the effects of manipulation.

In this example, we use the standard deviation of the spread between various bond-backed exchange-traded funds. I came across this example when doing research for our subscribers.

In the following chart, the top window shows a standard deviation measurement between the Bond-related ETFs for various maturities. This is plotted against the TIP for reference. We do not use the TIP to help calculate the top window trace, as this would be “double-dipping”.

The relationship should fluctuate, but anything too big means a fund flow bottleneck between sectors of a highly derivatized and typically liquid market.

We are seeing several two sigma plus events, which are unusual.

The first started when “the secret rescue” to cap the oil price began. The next was needed to “plug a leak”.

However, the third, or 4.5 sigma event, was the “king hit.” This is the big rundown in bond prices as bonds were sold off to provide cash to fund the secret oil rescue.

A six-sigma event is a major economic meltdown, like the Russian crisis that took LTCM. Those with a scientific background will find it ironic that the whole pattern looks like interference!

Points 4 and 5 are the rapid moves back into bonds to rebalance the 4.5 sigma inequality.

This is nerdish stuff and not much use for trading except to say that with regular two-plus sigma events, it’s not easy to trade rationally, so stand clear!

The bottom line is that if the US dollar had not been manipulated, we would currently have US $60 a barrel of oil!

To summarise:

• Manipulation exists
• Not all manipulation is bad
• Manipulation is often difficult to detect
• It’s no excuse for trading losses!

© 2004 John Tyler
“Fortune favours the informed.”
www.Trader007.com l www.infognome.com l

Stock Market News Today By Gale Bullock

Proprietor, www.pgtigercat.com

Market Manipulation…. Is it a good thing, a bad thing, or is it… Inconsequential?

Sol Palha, our Editor Guru, wanted the panellists to  “dig deeper by looking at Nature” for this Contrarian Round Table topic. “In the jungle, not everyone can survive… someone has to be killed for the other species to survive.”  — Sol Palha

How true that is! Being a Zoologist by degree, I call it Darwinian Theory.

This relates to the origin of species and the laws of the survival of the fittest. This also involves knowledge of Ecology and ecosystems. Did you know that forest fires as an act of nature are a good thing? Probably didn’t. Neither did the Federal Government when it tried to limit burning in the Muir Woods out in the Peoples’ Republic of California near San Francisco.

The FED’S [Federal Government] found out through Mother Nature that a little lightning strike now and then is a good thing for those little tree saplings. Perhaps Mr Greenspan and his pack of thieves [criminals], stealing our money through legal tender fiat FRNs should have been Zoologists first, instead of economic, econometric central bankers? Perhaps taking some ecology, eco-system, and other related Zoology courses on micro and macro markets could improve the efficiency and efficacy of market manipulation. [1]

Trying to expose market Manipulation

Anyone who knows the name Bill Murphy knows www.gata.org and www.lemetropolecafe.com. Mr Murphy and his cohorts (including Reg Howe Frank Veneroso and James Turk) have worked for years trying to expose the market manipulation and rigging of the bullion markets, based on the work of Summers and Barsky’s Gibson’s Paradox [3], which started under Slick Willie and the Airedale. Slick writes a book; the Airedale becomes a NY Senator, and they buy a mansion only the Hunt Boys in Kansas City could afford. We all know the FED through JPChase, Goldman Sachs, and a few other partners in crime can rig the bullion markets, including gold and silver prices.www.gata.org sent a report [4] years ago to the Ship of Fools, aka, the US Congress, about what was happening.

All these guys hopped a 747 to KC to go to Priscilla’s to buy dirty sex DVD videos they can watch on their laptops. At the same time, they appropriate and usurp both our money and our sons and daughters for pre-emptive wars for the sake of no oil and perhaps a few strategic military bases in Mesopotamia, aka the Fertile Crescent. Gee, Whiz! Why is gasoline $2.00 a gallon? Some DVD, huh? With John Embry’s and associate’s report on the gold and bullion market manipulation just released on August 24, 2004, at Sprott Asset Management in Toronto, Canada, it appears that markets can be rigged quite effectively. [5] When markets are rigged, folks get hurt economically, from the investors to the workers within that industry. That’s a bad thing.

Dirty Financial [Economic] Sex on Wall Street? Nahhhhhh!

I like to think about economics, sex, and money. Fits my Zoological background. That’s what Washington, D.C., is all about anyway, isn’t it? The combination of economics, sex, and money combine to make power. Political power. The power to control. The power to tax and spend. The power to manipulate markets. The power the Federal Re$erve, our central bank [which is nothing Federal, nor a Reserve of any kind] has. To rig markets. To rig Wall Street. To destroy our money.

To create the Working Group on Financial Markets (the Plunge Protection Team) to hold up financial markets, including the DOW and the NASDOG [6]. Mike Bolser’s work at www.gata.org andwww.lemetropole.com documents the Federal Re$erve’s use of the repurchase agreements to inject liquidity into the Wall Street market through key players to keep the Ponzi Shell Game going and the DOW above 10,000…. Or is that a leaky tank problem you flunked in Calculus 101, Dear Reader? Didn’t know Dirty Economic Sex and Calculus were related, did you? Nope, there’s not a lot of math involved in turning a trick, but the Ship of Fools, as well as Them There Boys at the Federal Re$erve, would have you all believe it is Calculus ‘over your heads!’  However, it isn’t. But, it is smoke and mirrors, the Grand Great Oz behind the curtain.

Hummmm…. Good, Bad, or Inconsequential?

Slick Willie redefined “is.” John Maynard Keynes redefined “good” as fiat money because we will all die anyway. Milton Friedman redefined “bad” through monetarist policies of just printing more of the stuff. So far, no one has redefined “inconsequential,” —  to my knowledge anyway! Let’s make an attempt at redefining “inconsequential,” shall we? The suggested reading is Karl Marx’s Communist Manifesto, printed in the 19^th Century. Welcome to Central Banking 101! A correlation has occurred! [7]

How the Inconsequential Cookie Crumbles?

Dear Reader [Jane and Joe Six-Pack, Wake Up!], would you like to take my cookie crumble test?

If you and your Mom and Dad have a home paid for and no debt, you get a cookie – a Nabisco Vanilla Wafer. If you and your Mom and Dad have all vehicles paid for, you get a cookie — a Nabisco Oreo, Double Stuffed. Now keep going! If the $50,000 REC Travel home for trips to Texas, LA, MS, AL, or FL is paid for, you get two cookies — all Rocky Roads, Archway Style!

If there are no leftover college tuition loans, you all get three cookies —  Archway Molasses!

If you all were out of Wall Street in 1999 or early 2000, or before the most significant market crash in history, you get a lifetime supply of 5-pound bags of Nestles’ chocolate chips and can bake your darling Toll House Cookies — whenever you want!

If you are in debt up to your eyeballs and in hock to the manipulative banking cartel, you may believe that investing in a rigged casino is the best way to get rich quickly. However, in rigged markets, I take the position it is better to be in cash assets than try to play at present with the Big Boys – that is unless one has already done their due diligence and knows how to play Wall Street and the central banking cartel – learning how to think for oneself, going against the spin of the Shills on Wall Street.

Jungles as Global Markets? Greenspan & the Boys Bake Toll House Cookies….

Going into the Kondratievian Winter Wave Cycle, under Austrian Economics, Von Mises, Hayek, Rothbard, and the other Economically Astute Austrians, the FED discredited in their propaganda, without cookies or chips for us everyday folks to bake with. Placing the FED’s hands in your pocket or purse is the Federal Reserve’s definition of “inconsequential.” Mr Greenspan and his Boys bake global economies. Sometimes, like in Argentina and Turkey, they burn the cookies severely. The elements of spin-ministering that come from the mouths of the other Bad Boys are so hilariously funny that it is frightening knowing these cooks are in the kitchen and that these Bad Boys are appointed, not elected, by Main Street America.

Dallas FED McTeer says we should all hold hands, buy an SUV like Ale-Gate-ors, and everything’s hunky-dory. Bernanke just got a contract for a fleet of jet helicopters with printing presses on board for helicoptering FRNs [money], and his statement to the Global Markets that we have a printing press defies logic.

The French also did at the time of the French Revolution, and they lost their ASS-ig-Nat [assignat is the name of the currency they inflated]! [8] The Green Man, as Sir Richard of Russell, calls him, says stuff like real estate can’t be a market bubble since all real estate markets are local. Ha! He also urges folks to take out ARMs for their home and home-equity loans ‘cause folks can save a lot of money. Ha! We think that’s like shooting yourself in the gonads, Zoologically speaking, with a Colt .45! As Dirty Harry [Clint Eastwood] says: “Go ahead! Make my day!

Inconsequential?

Perhaps that’s the way the Boys at the FED view it. The FED Boys are in the Jungle. Mr Darwin will prove the fittest to survive. The only thing is, there is no electricity in the Jungle, nor any Oven, to bake cookies and rig markets. If it’s a gas oven, the combination of no gas and no electricity may shoot Ponzi in the foot with that Colt .45. If Ponzi misses and shoots his Gonads, Zoologically speaking, we suspect they will define their poor aim at targeting select markets to rig and control as being more consequential, than inconsequential. If so, would that not be a non-sequitur? Have Latin, Will Travel!

Dénouement and Wrap this Thing Up with a Petty Bow

If my Mom Alice in Kansas City driving a gold 1991 Lincoln Town Car [with 115,000 miles] can figure out the trickery of Mr Greenspan and his Bad Boys at the Federal Re$serve on market manipulation, by reading my friend Ed Griffin’s Creature from Jekyll Island, anyone can.

These Bad Boys rig the markets through the Federal Re$erve central banking cartel, as well as the Bank of NY, JPChase, Goldman Sachs, and the rest of the criminals. Free markets? No way, baby! Ponzi Shell Game, you betcha! Park your money? 3% Treasuries fixed, with no link whatsoever to the Bastard [spurious, bloated, false] GSEs, which are going to one day blow up, melt down, and make both Enron and Long-Term Capital Management look like a 5-year old’s Birthday Party Celebration. Inconsequential? I don’t think so! Hello, Appraisal Institute! – Are you listening????  Chips Ahoy! [9]

© 2004 Ole Bear
Aka, Gale Bullock
Proprietor, www.pgtigercat.com
Email

Footnotes:

[1] See Chapter IV, Origin of Species, Natural Selection, or the Survival of the Fittest.

[2] The Priscilla’s chain in Kansas City is a chain of Adult Stores and a pretty classy operation. These folks have some very high-profile and very upscale stores in some of the best target markets of Greater Kansas City. When you can drive to the mall and by Priscilla’s, they must do something right in their Book of Business. We have been told their prices are far below those in Greater Washington, D.C. It is economical to take a Boeing 747 for a Ship of Fools massive shopping trip – since they didn’t know how to read the www.gata.org report on the Gold Derivative Banking Crisis. I know about the company since my little sister, Rebecca, day-trades their stock successfully. Grin.

[3] See also: Gibson’s Paradox

[4] See: Gold Derivative Banking Crisis at this link: http://www.gata.org/test.html

[5] John Embry – “Not Free, Not Fair: The Long-Term Manipulation of the Gold Price” found at www.sprott.com. This is a 71-page [pdf] file essay and is currently making international news.

[6] See Google Search Link for Working Group on Financial Markets and the Plunge Protection Team.

[7] For the online Communist Manifesto. Part of the Marxian tenet for the Great Society [a reference to Guns and Butter, an economic policy of Lyndon Baines Johnson, former US President, who fiasco in a tiny country called Viet Nam] was a central banking system. There are also some other corollaries among Marxian theory with respect to government and economics, which closely resemble what I saw with I turn my chair a full 360 degrees. Benjamin Franklin said that the Founding Fathers created a Republic with the Constitution… as long as we could keep it.

[8] See Fiat Money Inflation in France: How It Came, What it Brought, How it Ended by Andrew Dickson White. This was written in the 1870s! What a micro-gem on the Histories of the Markets!

[9] See Creature from Jekyll Island: A Second Look at the Federal Reserve, by G. Edward Griffin.

See Also: What Mr Greenspan Really Thinks?, by Dr Larry Parks. The link will take you to the reading list page at www.fame.org, and you can view the [pdf] file online.

© 2004 Gale Bullock, MAI, SRPA, SRA
www.pgtigercat.com l Realty Reality

Peter Spina
Proprietor
www.gold-seeker.com

Stock market news today from Peter Spina

“MARKET MANIPULATION IS IT A GOOD THING, BAD THING, OR IS IT INCONSEQUENTIAL?”

Market manipulation distorts free-market values. If you do not allow pure free-market supply and demand fundamentals to dictate equilibrium prices, a price variance will occur. The gold market is a great example of this situation. Over the past few decades, central banks have been dumping their citizens’ gold reserves onto the market. This extra supply has bridged a huge gap between the gold market supply and demand fundamentals.

During this process of central bank gold liquidation, the price of the metal was pushed to extraordinary lows, which forced many mines to halt production and companies to fold. The cost of mineing gold became uneconomical at market prices, and the supply shrank further. Exploration all but ceased. The industry became decimated during this two-plus decade-long bear market.

For those observing the destruction of the gold market over the prior years,

it became evident that a massive shift from actual representative values had occurred. In other words, a very lucrative opportunity emerged, which continues to this day. Therefore, gold market manipulation is harmful to true market pricing yet very profitable for those who enter the market once extreme discrepancies occur and cannot be maintained.

The manipulation of the gold price leads to a distortion of other inter-market relationships. According to some respected industry observers, as gold is a measure of the value of the world’s fiat paper, accurate currency prices are also distorted as the corresponding barometer is being purposefully managed. In an economic system of checks and balances, gold’s inability to reflect true market prices via known and unknown management by the world’s governing powers gave the ability to distort other markets as well.

Market manipulation is harmful when reflecting true valuations.

This situation is even more harmful when market participants are unsuspecting of the distortion. Transparency is a must if investors are to understand the true nature of the marketplace. I do not believe this can be said of the gold market at this time. Investors should work and support the efforts to provide this transparency if they believe in free markets. Without this, how can free people make educated choices? It simply is impossible.

© 2004 Peter Spina
Proprietor
www.gold-seek.com  l

 

Alan Lunt
Contributor
www.tacticalinvestor.com

Stock market news today: Who do I take the knife to?

Farmer and Sons, dust storm, Cimarron County, Oklahoma, 1936. Photographer: Arthur Rothstein.
The drought that helped cripple agriculture in the Great Depression was the worst in the climatological history of the country. By 1934 it had desiccated the Great Plains, from North Dakota to Texas, from the Mississippi River Valley to the Rockies. Vast dust storms swept the region. http://www.english.uiuc.edu/maps/depression/photoessay.htm

Manipulation of the markets is no more different than what a farmer does with his dogs when he rounds up sheep and cattle.

You could put a ring around the fact they, the sheep and cattle, are not happy. They bleat and moo their opposition to anything that will listen. The farmer has ruined the peace and tranquillity of their day. But is this manipulation to their detriment or to and for the greater good of the mob? The farmer would say yes, it is. Fresh grass and new scenery await. But from the mob, one or two always complain and try to get the better of the shepherd and the dogs. They get a nip on the nose…… or rump for their efforts. The one with the biggest stick wins for the time being.

In the markets, there are always those who try to get the better of the shepherd.

In the case of the US, this would be the administration of GWB. To be in politics takes money, big money, and there is always a payback involved. So, the money men are setting the scene for the future as they fund or buy a candidate. That is blatant manipulation, but it is perfectly legal. A giant stick wins.

Is it fair to the bears when the ESF steps in to hold and reverse a steep decline? You know as well as I do what the noise from the mob would be like. But hold on a minute. A steep decline is a disaster for an economy; money lost, liquidity dissipation, unemployment and business failures. That is not the situation the moneymen bought when they funded their candidate; they don’t want their money to be lost. The shepherd is also looking for the greater good of the entire farm, not just a sector of the farm.

Every advisor, commentator, investor, and leader is trying to manipulate the market to suit their agenda.

They accept everything that occurs in their favour as correct and bleat loudly when that belief system is challenged. The logical conclusion is that the Bears win half the time, and the Bulls win half the time. In this game, 50% is not good enough to survive. What does that say about biases?

The other aspect no one seems to be too interested in is that the market has been in the hands of the moneymen since the formation of the Federal Reserve in 1913. That was Senator Aldrich’s aim when the clandestine meeting was held on Jekyll Island. The life and times of the average man changed forever.

The absolute worst situation I found myself in when farming was the winter drought of 1989.

I had no access to irrigation, so the animals and the man suffered together. I told myself that every day was a day closer to rain. I was right. It rained, and then, in 27 days, there were 23 touches of frost. The ground froze, and so did the grass. It was an agricultural Kondratiev winter.

As much as I hate printing money and subsequent consumer price inflation, it is only logical that the Federal Reserve would turn on the irrigation.  What they do when the frost starts is another matter. Mother nature has a way of returning everything to normal, but both extremes are tested before she does. Be careful what’s wished for; it may just rain.

© 2004 Alan Lunt
www.tacticalinvestor.com  l

David Gobel
Chairman & CEO
The Methuselah Foundation

Manipulation Or What 50 years have taught me so far

Sometimes, it’s good to go back to basics to see clearly. For instance, money is a device to facilitate cooperation. It is based on human memory and the ability to believe that there is such a thing as “the future.” When you combine memory and belief, you can get faith and hope. The utility of money is founded on faith and hope.

Historically, Money has proceeded from the utterly tangible and intrinsically practical such as sheep, land and salt, to the symbolic (i.e. you can’t eat it or plant it…gold, silver, jewels) to the abstract/hypothecated (paper money, big stones with holes, seashells) and finally for the first time in history, we have virtual or invisible money (electronic bits in the cyber-ether, ledger entries). At each step in the process of virtualization of money, there are dramatically lower transaction costs, dramatically higher probabilities, and ease of counterfeiting by either criminals or governments.

In the first instance, there’s not much use in trying to counterfeit a cow. It’s pretty easy to discover that two guys in a cow suit are an udder fraud when there’s no milk coming out. So, the trust component of physical property/commodities is high…not much need for faith or currency laws…but transaction costs are also very high. At the other extreme, where we are today, money has become so hypothecated – so gaseous that it’s like the barely remaining grin left over as the Cheshire cat disappears – managed by a rat’s nest of rules and regulations to ensure the continued legitimacy of the currency.

Stock market news today: Hot Money controls everything

Opportunities and temptations for market manipulation correlate with virtualization and the speciation of money.

Today, we have literally tens of thousands of money creators tenuously connected with government official mints. Each of these creators contributes a variant species of money. Some examples of these species are stocks, bonds, derivatives, credit cards, receivables factoring, loans, balance entries in computer networks, futures contracts, etc.

Let’s take a look at stocks as one example of money creation. Who creates stock? An entrepreneur gets an idea, gets two experienced business buddies to join in and incorporates a concern with 10,000,000 shares of stock. The store has zero value, or for legal purposes, par of .0001. The founders then use their reputations from past success and a back-of-the-envelope plan to get funding from angel investors. The stock is now worth 10 cents per share. The company has no product whatsoever.

Stock market news today: Why do angel investors invest in nothing?

Because they believe in a highly abstract concept called a market. What does this “market thing” purport to offer to angel investors? A collective group of individuals who have

1)   More money than they need today who, out of fear of and greed for the future, are willing to bet excess money for the promise (see: mutual fund salesmen) of additional money in the future to fund a thing called “retirement” – otherwise known as “slow death”…i.e. I want the best slow death money can buy. (or see: www.methuselahfoundation.org)

In aggregate, this excess money (capital) presents an opportunity to take the original nothing (stock) that the angels bought from the entrepreneur and to offer it later with more nothing (the angel’s money electrons floating around in a network somewhere). By the time the stock gets to an IPO, there may really be some “somethings” in the company – perhaps some patents and a proof of concept with some reference customers who say they will buy lots more of these things. So, long story short, the original par value of nothing has grown infinitely to perhaps $15 – $135 a share at the IPO. No one from the Federal Reserve or the Mint has created any money. The company did it through “the market.” Legal counterfeiting.

With these fundamental dynamics in place, we can now examine and compare similar phenomena in nature…Earth – the ultimate venture capital incubator.

Our story begins as the sun beats down on the ocean, where tiny sea plants (phytoplankton) objecting to the heat respond by releasing high quantities of cloud-forming particles on days when the sun’s rays are especially strong. The compounds evaporate into the air through a series of chemical processes that result in especially reflective clouds. This, in turn, blocks the radiation that is bothering the phytoplankton. In other words, they make umbrellas made of clouds.

These clouds move over land masses and drop rain onto savannahs, where gravity collects the excess water into pools. Over time, a microcosm emerges at the pool that attracts animals interested in the benefits of the pool – even though they did nothing to create the water or the ecosystem. As the herds grow, predators arrive who discover that when the herd’s heads are down while sucking from the pool, their backs are turned and they are easy prey. The predator’s strategy is to get as much herd as possible, while the getting is good.

Naturally, such easy prey attracts more and more predators – eventually leading to organised and cooperative behaviour – such as lions who hunt in packs. This makes it more and more difficult for an individual predator to compete – in fact, the pride will turn the individual predator into prey until they are removed from the competition. Thus, predation becomes institutional in nature.

Of course, the herd notices that some of them are getting “killed” from time to time,

but they have concise memories (http://www.adm.uwaterloo.ca/infocs/Study/Curve.html) and frankly don’t care about what happens to the “other gazelles.” They herd simply because each herd member has a better probability of not being dinner when it’s hunting time than if they were alone. If the herd drinks too much of the pool, the whole system adjusts as both prey and predators die off proportionately.

Gradually, the equilibrium of prey/predator emerges, where everyone gets what they individually need. The herd receives low energy / low yield slow but steady food, and the predators get their highly concentrated hits. As long as the predators don’t scare the herd so severely that they induce a stampede, everybody who is not dead is happy. If the predators go too far, they will cause a stampede. Everybody in sight gets trampled, exhausted and terrified…interestingly, the pool is not mobile. So, while the pool may have been depleted due to overdrinking by the herd, gradually, the incubator function will cause more rain to fall, and the pool will again begin to fill. The stampede will become a hard-wired memory in the herd, and many will refuse to return…but some who’ve been through it all before will return early and get lots of free drinks. The mesocosm of sun, clouds, rain, pool, herds and predators is –  “a market.”

Are our financial markets manipulated? Of course. The real question is: Are they IMMORALLY or ILLEGALLY manipulated? One can answer the question simply by asking: Is it like predators to be nice and play by the rules?

For a clear “spin-free” answer, enter the following query into Google …

“neither admitted nor denied” OR “admit or deny” settled

Go ahead…do it now.

What you get is a list of over 4,000 hits listing the evident proof that market predators do what they do…and unlike most industries, Finance has a unique “get out of jail free” capability built into the law…all they have to do is turn over a large portion of the carcases – the settlement – over to the masters of the feast – and then they can go back to their predations.

So, to review, entrepreneurs make stock out of nothing to generate money (which is nothing) to convince angel investors to contribute their nothing in exchange for nothing (stock) in the hope of getting nothing. Gradually, there are enough nothings that sometimes Something (product/service) pops out. Then, in the hope of getting lots of these and similar things in the future (which never actually exists – there’s only NOW), the herd invests their nothings in the hope of getting lots more nothings in the future to buy the things. Along the way, day traders (piranha) and brokerages/investment bankers (organised predators) convince themselves that they provide a service to society by managing the pool, culling the herd and shepherding the sheep…and the master of the feast works to preserve the natural order of things.

Some of you may object to the characterization that so much activity is based on nothing.

It’s way too hard to take seriously. As anecdotal evidence, I offer up the curious case of Therese Humbert, whose apparent wealth generated enormous economic activity in late 19^th century France. “…In her elaborate Parisian apartments on the Avenue de la Grande Armée, Thérèse kept a strong box. It was supposed to contain four documents. The first was the final will of an American millionaire, Robert Henry Crawford, naming Thérèse as sole beneficiary…” Until it was found that she actually had – and had always had – nothing. See:http://www.nytimes.com/books/00/07/09/reviews/000709.09kaplant.html

How can it be that almost no one has ever heard of perhaps the most powerful economic actor in late 19th-century France? Because more than anything, those who sell investments in the Emperor’s new clothes can never admit and therefore remember that after all is said and done – the emperor was and is naked. There is no money. Thus, Markets are indeed manipulated – or rather, PEOPLE are manipulated. To spend their lives in pursuit of nothing.

So, what is REAL?

Curiosity applied intellect, love, kindness, air, water, fire, perception, mountains, family, death,  Life – the key thing is Life! If you were an oil well, as you aged, you would qualify for a tax deduction – an “oil depletion allowance.”  Are you a depleting asset? Invest in real things – life first and foremost – while there’s still time.

© 2004 David Gobel
Chairman and CEO
(and former day trader)
The Methuselah Foundation
www.methuselahfoundation.org
www.methuselahmouse.org
(202) 306-0989

Wayne Krautkramer
Proprietor
Zarathustra

MARKET MANIPULATION OR INFORMATION MANIPULATION?

We are inundated with market manipulation and conspiracy theories. I will attempt a logical inquiry into this phenomenon. For a good lesson in information manipulation, your best bet is to go to the stock market. If you think Marty Schwartz is an isolated case, read Ray Dirk’s story. Therefore, I shall confine my study to the commodities markets. The commodities markets are the oldest in the world. The various commodities provide significant amounts of data for analysis. If effective manipulation exists, one will be able to track its effects. We will define successful manipulation as having interfered with a commodity’s ability to exhibit the normal accumulation, distribution, and trending zones. This creates an objective benchmark for this inquiry.

Any discussion of market manipulation must be reduced to the elements

that might create a belief in the phenomenon. We must first deal with our need to believe in market manipulation. Since evidence of market manipulation is sparse, what generates this tendency to suspect manipulation or conspiracy? We must further define the process to differentiate between the attempt to manipulate the markets and the actual manipulation of the markets. A further distinction is necessary. One must distinguish between those processes that are manipulatable and those that are not. For example, political and social processes are manipulatable and may be nothing more than manipulation, coercion, and conspiracy.

Stock market news today: Physical processes are subject to the laws of nature,

And any attempt to successfully manipulate these processes is possible only by complying with the physical laws involved. One could be found in the position of claiming the laws of nature manipulate the markets. This forces us to examine the true nature of markets. Are they controlled by man or some more considerable force? The final question is the definition of market manipulation. Are we speaking of the intraday price action or daily price action? The weekly and monthly price charts will show a different picture. Trading ranges behave differently than trending markets.

Do we tend to believe in manipulation and conspiracies? The answer is yes! Our social world reveals attempts to coerce, manipulate, and regulate in every facet of social interaction. The attempt to control outcomes to our benefit is part of our survival mechanism. It is an indisputable part of existence in society. However, this does not prove that these conspiratorial efforts effectively manipulate markets. Aesop once said, “And the mice voted to bell the cat.” Many activities are beyond the power of social pressure.

The laws and pretensions of humanity are just foolishness when confronted with the power of nature.

Therefore, any intelligent discussion of market manipulation must properly differentiate between social creations and phenomena based on physical reality and its laws. A steel mill would be an example of a process that is indifferent to society’s schemes.

The only way to increase output is to improve the inputs or evolve a new technology that requires a complete understanding of metallurgy principles. Wishing, hoping, dreaming, and screaming are irrelevant. Social activities and politics are the domains of emotions and perception manipulation, not the commodities markets! Again, J. L. Livermore has anticipated our question. Livermore said, “I sometimes think that speculation must be an unnatural business because the average speculator has arrayed his nature against him.

The weaknesses that all men are prone to are fatal in success in speculation- usually, those very weaknesses that make him likeable to his fellows or that he mainly guards against in those other ventures of his where they are not so dangerous as when he is trading in stocks or commodities.”

Stock market news today: Manipulation of Information is rampant

The most crucial facet of market manipulation is manipulating information about the market.

This is the rock that sinks most investors’ ships. George Soros made an interesting observation of market information. He said, “Economic history is a never-ending series of episodes based on falsehoods and lies, not the truth. It represents the path to big money. The object is to recognize the trend whose premise is false, ride that trend, and step off before it is discredited.” This observation comes from the most excellent currency trader alive. I believe he has thrown down the gauntlet regarding the value of the information you receive.

Does market manipulation exist, or is it merely the lies and deceptions about markets that are the manipulation? George Soros has shared his experience. Leo Melamed, the founder of the International Monetary Market (Chicago Mercantile Exchange), gave a speech. In this speech, Futures, the Coveted Scapegoat, he said, “Derogatory comments, defamatory innuendos, inflammatory jokes, false accusations, misleading opinions, half-truths, out-and-out lies, that is the fate and burden of futures markets. Thus, it has been throughout time and will no doubt continue. And why not? From time immemorial, predicting the future has been a hazardous occupation.”

We are now ready to look at commodities.

Copper is a good market for discussion. Copper is one of the most necessary commodities in the industrialized world. It is also one of the best economic indicators. Copper is really a gift to a trader if one looks at a 20 to 30-year monthly chart. It follows a very discernible trend. The weekly trend is also reliable. Gold is a little different in its movements. It has a mystique due to its prior role as a backing for currency. It was the backing for many currencies at one time. Richard Nixon “freed” us from the gold standard on August 15, 1971. Since then, there has been no currency in the world that is redeemable in gold. This has not affected the gold trend. It is still a good trading commodity with very discernible trends.

Gold is a very valuable metal with unique properties for medical and electronic applications. It also functions as fine jewellery.

It exhibits a well-defined frequency and has excellent liquidity, which is paramount for successful trading activities. The gold market’s liquidity is far superior to the copper market. Gold may provide more trading opportunities now because it is not a currency equivalent. We must remember that the objective is to make profits. Let the rest make political statements. As we look at these markets, we can observe clearly defined patterns of accumulation, distribution, and movement between these zones. Learn how to identify these opportunities and let the market do the work.

When one looks at these markets every day, reality seems to shift.

There appear to be many opportunities for profit-making. However, Tom Baldwin, the legendary bond trader, has publicly stated that he uses monthly charts. Tom Baldwin is a floor trader and uses monthly charts. Hello, people! The world’s most successful individual bond trader does not trade against the trend. Ed Seykota, who has the best track record in the world for general commodity trading, has publicly stated that day trading is the equivalent of feeding a slot machine. Seykota knows about slot machines as he lives in Incline Village, Nevada. Leo Melamed said, “How much better and more fun it is to be a lover.

A trader who is a lover is a trending player

—The trend is his friend. He seeks out the trend of the market and romances it.

He loves the market, whether bull or bear; he follows wherever it leads. If it’s in an uptrend, he’s bullish or leaves it alone; if it’s in a downtrend, he’s bearish or stays out. He does not try to pick reversals or outsmart the world; he merely wants to follow the market’s direction. When a lover increases his position, his original position is profitable, and the market shows continued promise. Lovers also have losing positions but never allow it to become a fight with the market. Unlike the fighter, the lover never closes his eyes with righteous indignation; I will be correct. Unlike the fighter, the lover seldom blames a loss on the market.

He may be wrong, but never the market.” Having placed day trading and trading against the trend into the appropriate file on your desktop (recycle bin), we have removed the significant illusions of market manipulation. I should mention that there is a world of difference between finding a good market entry point and determining the trend.

Trading ranges act differently than trending markets.

It was not long ago when trading ranges were called On The Side. Professionals would move on to markets that were trending. Anything can happen inside a trading range. Many times in a market’s history, a trading range has turned out to be a trend reversal. J. L. Livermore never bought or sold a market in a trading range. Richard Davoud Donchian, Bernard Mannes Baruch, and W. D. Gann avoided trading ranges. Trading ranges are just another rock waiting to sink the investor’s ship. Remember, speculators can not buy hull insurance!

Finally, we must deal with the question of the nature of the market itself.

Does man control the markets? The commodities markets are based on natural, physical substances and life’s necessities. The contracts for grains, oilseeds, metals, and exotics are based on the actual cash market for these commodities. The same is valid for petroleum contracts. Seasonality, weather, plagues, and cycles are just variables controlling the commodity supply. Nature rules this world. El Nino and La Nina have more impact than foolish legislatures or cartels who want to manipulate the outcomes.

Your governments may appear to control demand, but nature always controls demand and supply. Nature even controls your government. One good plague or natural disaster can devastate the human population. Perspective is critical when listening to the stories of manipulation, conspiracies, or even the purported power of government. This study excludes financial markets. The new financial commodities are different and have yet to stand the test of time!

The results of this inquiry suggest that market manipulation in the commodities market is more myth than reality.

However, information manipulation is rampant. Ed Seykota warns of this problem. Seykota is always terse and calls all such information “funny metals”. All the information you need is contained in the price and volume histories. I know some will disagree with this conclusion, but it has the advantage of overwhelming evidence. The greatest traders in the world agree with this conclusion. This has been true for many generations. E. H. Harriman, Philip Danforth Armour, August Cargill, J. P. Getty, J. P. Morgan, Gustavus Franklin Swift, and many other masters of markets add to the evidence.

There is only the trend, and the Trend, and the TREND!

© 2004 Wayne N. Krautkramer
Proprietor
Zarathustra
Email

Originally released on September 21, 2015, and consistently refined over the years, the most recent update was conducted in July 2024

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