Posted on 04/07/2014 10:47:28 AM PDT by Errant
Everyone's talking about Michael Lewis' latest book Flash Boys and HFT (high-frequency trading) and whether the markets are rigged.
What they're not talking about is how the markets have been set up for institutionalized rigging.
I'm not kidding.
The markets are rigged. You're going to have to get over it and deal with it.
The rigging is in the system and that's just the way it is...
As to HFT, I'll get to that...
But you can't pass judgment on HFT until you understand how cascading technology and unintended consequences landed us in the deep end of the dark pool we now call the market....
And who really set the perfect table for the problem...
(Excerpt) Read more at moneymorning.com ...
Ping-a-Ling!
The Market it’s self is now an abstract ponzii scheme
Gotta sign up to read it.
S&P Tumbles From Record-High To Red Year-To-Date In 2 Days
I've learned however that the ability of the TPTB to keep the game going is often underestimated.
If it wasn’t rigged, you wouldn’t be allowed to participate.
One could buy and hold for long periods of time, over which micro-second strategies are quite irrelevant.
Buy-and-hold works when you’re in a long-term bull market.
We’re not in a long-term bull market. That ended at the end of 2002.
Under our current circumstances, IMO, that strategy will better be applied to silver coins and maybe a little silver and gold bullion. But you probably already have those bases covered.
I think we're entering at least another recession, if not a serious depression. I'd wait for a crash before buying large caps or even medium caps now, even considering a declining dollar. There might be a few emerging tech stocks to consider in the 3d printing, security, war fighting, food production, and crytocurrency categories tho.
BFL
The big boys have always had advantages over little guys. Not just in trading but in life in general. Deal with it. One can’t beat traders by trading in and out. However one should not use this as an excuse to not be in the market at some level compatible with one’s age and risk tolerance. With bonds at ridiculously low rates one has to have some amount in stocks to offset inflation. I have some in stocks, little bit in bonds and a lot of cash. But that’s me.
There was public news a long time ago saying that the government or Fed was buying stocks but would not exercise control over companies that received majority investments. So money has been shifted between stocks and bonds, then back in order to continue propping the dollar unnaturally high internationally, prevent the bond collapse, prevent repudiation of debt, etc. It appears that the plan is to slowly shrink the economy to fit only the most worthy without any major market fluctuations and without expanding domestic manufacturing.
Reminds me of a talk Mark Faber gave a few weeks ago about unlimited printing creating unequal bubbles. Sooner or later bubbles pop and the rush will be on to find the actual values, creating much turmoil in the process. Such is always the eventual outcome of artificial manipulation of markets. We however are in a much worse predicament in that we’ve now got a runaway government and its spending on our hands with millions dependent upon ever increasing debt.
Sure, but now is not the time to enter the market after years of an effort to artificially inflate it, IMO. I'll just sit this one out, if you don't mind.
THE Berlin Stock Exchange still exists—as a building,
as an institution with large offices, with brokers and
bankers, with a huge organization for daily announcement
of stock and bond quotations. But it is only a
pale imitation of its former self and of what a stock
exchange is supposed to be. For the Stock Exchange
cannot function if and when the State regulates the flow
of capital and destroys the confidence of investors in
the sanctity of their property rights.
The glorious days when millions of marks daily
poured into the Stock Exchange, when the bonds and
securities of foreign countries were handled, when new
concerns and trusts were promoted and exciting speculative
maneuvers were staged—those glorious times have
long since departed, and even the doorkeeper who
vividly remembers the excitement of the “good old days”
does not believe that they will ever return. Yet the
decrepit machine still runs.
From the Vampire Ecconomy, 1939
Even so, I think it's the artificial support of the market that has created a far worse problem.
Very well said.
well the stock market is not even close to a casino as far as probabilities of losing your money. Dollar cost average into a conservative mix of stocks and bonds over 40 years and you will do fine. Not so much with a casino.
BFL
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.