Crooks, Computers, and the Coming Crash

Silver Bear Cafe ^ | 09/06/09 | Graham Summers

[djf]

As stocks continued to rally into September, one has to ask one's self, "just who's buying this rally?"

The answer?

Computers and no one else.

I've written extensively about the computer trading programs that are dominating this market. All told, High Frequency Trading Programs HFTPs control 70% of trading volume on the NYSE.

However, at this point, five stocks (yes only five) account for 40% of the trading volume on the market. Those five stocks: Citigroup, CIT Group, Fannie Mae, Freddie Mac, and AIG. Think about that, five stocks out of several thousand, are accounting for 40% of ALL trading.

And what do the five have in common?

[djf]

So when the Dow trims 4500 points in one day you can bet yur 401K it'll be because of a "computer glitch..."

[djf]

Ping!

[freekitty]

All friends of Obama & Co.

[djf]

These guys buy and sell presidents. It doesn’t make a single dam bit of difference if it’s a republican, a democrat, or a purple people eater party.

[Former Proud Canadian]

Mark for the coming crash.

[Joe Boucher]

Ya know America is the economic engine of the world.
If we were to crash that hard do you have any idea what things would be like is say Latvia or the Sudan? Maybe Honduras?

[freekitty]

Hope they remember how the politicians Westinghouse bought turned on Westinghouse and sold them down the river. That is what is going to happen to GE and Goldman Sachs.

[jacquej]

My best guess for the “crash”?

We will see it by the end of the first or second week of November. Both the USA chart and the Fed Reserve chart are under significant stress around that time.

Hope I am wrong, though, for most of the people in the US are not ready for this.

[CharlesWayneCT]

I stopped buying stocks a while ago.

Imagine my surprise when I found out that my computer was an addict, and had it’s own E-trade account on the side. It had been skimming money off of my trades for years.

Now my computer is thousands of dollars in debt, and it’s processor is being repossesed next week.

A sorry end to a cautionary tale. If only I had turned off the wifi when I went to bed at night.....

[yorkie01]

This is a phoney market with Tim Geithner’s monetizing of our money/debt using foreign banks behind closed doors. It will come back to haunt us with super inflation and widespread unemployment. This is how this administration is ‘improving’ our economy.

[djf]

Lol!

Deal is, though, that these guys are trying to squeeze every single small percentage of a possibility that they might make a profit.

My guess is that that’s why the stock numbers went from denominations in quarters “Yuck,Co closed today at 7 1/4”
to denominations in exact pennies.

I’m not sure how many actual jobs are tied to the level of the Dow. If it fell a couple thousand points, most folks would still have their job.
They might not ever again be able to afford a vacation, but they would still work.

[TruthFactor]

I'm have my 401K with Fidelity. Before all the market problems I had it spread out between equities(65%), bonds(30%) and cash(5%). Then the market tanked. I lost 25% before I decided to do something. In Oct. of 08' I went 3/4 into cash and effectively stopped the bleeding. Then in late Jan. 09' I jumped into China Fund and Pacific Rim Fund with 3/4 of the total and made back my loss + 5%.

But, last week I put it back into 3/4 cash(stable fund) again. I smell an ill wind. I think we're go'in down baby, way down.

[djf]

Heard a rumor last night that some of the Saudi sheiks are starting to demand payment - in gold.

[George from New England]

I am 80% in Fidelity precious metals fund (FSAGX), 10% in UDN and 10% in cash. Still got 1000 shares of MSN, a Chinese co.

[djf]

If we were to crash that hard do you have any idea what things would be like is say Latvia or the Sudan? Maybe Honduras?

For them, actually, not much worse.
They are alot more used to living hand-to-mouth.

But after a couple weeks of not being able to afford Happy Meals, yur average soccer mom is liable to pick up an HK-91 and head down to the mall!

[encm(ss)]

I don’t believe his numbers. They don’t match up with the market. Sorry.

[philetus]

I think when America’s economy crashes, the whole world will be in the sh!thouse.

[Neidermeyer]

My guess is that that’s why the stock numbers went from denominations in quarters “Yuck,Co closed today at 7 1/4”
to denominations in exact pennies.
******************************************************
BEEEEP! Thanks for playing ... the change to pennies was because GS saw that they could frontrun larger numbers of equities daily if prices were quoted in the smallest possible denomination.

The level of the DOW 30 may not be critical in itself but the ability to raise $$$$ for expansion and operations through the equity market is critical ... we’re about to see bonds crash in response to the higher interest rates coming at us .. with no alternatives to raise cash we will see a huge number of businesses fail... and even if a particular business is well run and cash rich they could easily be killed if a critical supplier dies off. How long can Boeing make airplanes if a chemical critical to bonding kevlar fabric/carbon fiber fabric just wasn’t available at any price?

[IDontLikeToPayTaxes]

I’ve been buying short and ultra-short ETFs. I’m basically shorting the DOW and S&P 500. :)