>> the CME Group, the exchange in Chicago, has an incentive program under which foreign central banks could buy stock market derivatives like the S&P contracts at a discount.
Now please close the loop and explain exactly how buying *derivatives* “props up” the market.
I’ll wait patiently.
There’s about a quadrillion dollars worth of credit derivatives which are basically a form of insurance against these kinds of losses. When the world economy crashes hard who will pay for them?
It can create an arbitrage opportunity . Sell the derivatives and hedge by buying the etf(spy). Buying the spy then leads to rising individual stocks on the same principle.