The Greatest Show on Earth: Stock Market Three-Ring Circus (Fed, Treasury,
SEC), but anarchy ensues with no Ring Master! This statement issued by the SEC
on short-selling rules
is beyond belief. The lengths they are willing to go, in order to shore up the
market indices, is unreal. Confidence has been lost, can they really believe
this kind of measure is going to make investors happy? As happy as the were
over the “bail-out” of AIG?
Millions of investors entrust their savings to our securities markets because
they can be confident that our markets are orderly, liquid, efficient, and
rational, said Chairman Cox. The turmoil in today’s markets, particularly in the
financial sector, is challenging that assumption for ordinary Americans. Markets
are the best tool a free society has to price and allocate assets across a
complex economy, but as is well known from experience, sometimes the wisdom of
crowds is supplanted by crowd behavior. We need well-functioning markets
to help us draw the line between reasonable miscalculation and error or
something worse involving the failure of due diligence, self-dealing, and
conflicts of interest. It is thus vitally important that the market mechanism
continue to inspire investor confidence.
Dang shorts! It’s all the short sellers!! Sure it is! It couldn’t possibly
have anything to do with bad management and billions of dollars in losses. I
take issue with much Cox had to say (like “ordinary” Americans), but the most
ironic part of this statement is about “self-dealing” and “conflicts of
interest.” Who would know more about that than The Federal Reserve, the US
Treasury, and the Securities and Exchange Commission? Billions of dollars are
being poured into the banking system everyday, (through overnight loans,
7-day/28-day/name-a-day loans), in an effort to stabilize the financial
system.
How do you know your country’s financial system is in major trouble?
1. Banks start merging
2. They start filing for bankruptcy
3. The government gives them Billions of dollars for daily operations
4. The government encourages China to buy them all
5. The SEC blames stock short-sellers for their demise
6. The government just puts them all into conservatorship
Tomorrow, the US is selling $30B in 76-day bills. The US government is
trying to raise money. Are we having freaking fun yet?? I am “short” this
market, and I will stay short. We will have a bear market rally at some point,
and when we do, I will play some long positions and short even more! With
everything we know now, I believe this market is way over-valued.
Chuck will place some charts in this post shortly.
(GLD Daily Chart)
(QQQQ Daily Chart)
Wells Fargo (WFC) Daily Chart
Financial Sector (XLF) Daily Chart
