Minimize

Welcome!

Little Green Men?

Big Al
August 28, 2015

Click download link to listen on this device: Download Show

What is meant by “manipulating the markets”?

Discussion
14 Comments
    Aug 28, 2015 28:41 AM

    Chris:
    What would an interest rate rise do to the drillers who are operating on big debt to pump more oil that nobody needs?

      Aug 29, 2015 29:17 AM

      Nothing immediately; but it would make it more cumbersome to roll over such debts as they came due, as the lenders would think twice about loaning more $ if it cost THEM more to do so.

    CFS
    Aug 28, 2015 28:57 AM

    Well said Mr. Temple about manipulation. I could only find two specific interventions of market propping up this week.

      Aug 28, 2015 28:47 PM

      I totally agree. Clearly there are times where Central Banks and all countries add support to the markets both overtly and covertly, and instances where larger financial institutional investors will run stops, and dump contracts on the markets in after-hours and pre-market trading when volume is thin. However, the constant trumpeting of manipulation talk every time there’s any movement that someone doesn’t like get old. I think Chris’s thoughts were on the mark on this topic.

    CFS
    Aug 28, 2015 28:06 AM

    Since it was at night, the little green man obviously was not a Leprechaun looking for his pot of gold at the end of the rainbow.

      Aug 28, 2015 28:14 AM

      No, upon further reflection I have come to the conclusion that it was a tap dancing coyote.

      Amazing just how our 14 pound guard dog (Caly) goes absolutely nuts whey one of those critters gets on our deck!

      Aug 28, 2015 28:26 PM

      CFS – It was clearly Irishtony. 🙂

    jed
    Aug 28, 2015 28:21 AM

    agree with your manipulation ideas – its absurd that the fed is playing in these markets on a daily basis

    Aug 28, 2015 28:14 PM

    The manipulation nonsense is just newsletter writers playing into their subscriber’s confirmation biases. Most people make poor investment decisions but don’t want to accept the responsibility for their own decisions. They therefore gravitate to so-called experts whose beliefs are closely aligned with their own. This way, it’s much easier for people to accept being wrong if their “gurus” are wrong as well. And since both they and their guru missed the call, then there has to be some other explanation for being completely wrong. And that’s when it is easiest to just blame manipulation or some other unpopular third party like the bullion banks, the Fed or China.

    Here are some questions to ask yourself if you want to know if your guru is legit. Since most of these guys only follow assets like US stocks, gold and oil, then how have they fared during the dramatic moves in the current trends? Since 2009, how much of the nearly 250% rally in stocks have they participated in? For gold how much of the over 40% selloff have they caught since 2011? And how many have played the nearly 65% selloff in oil in the last year? Many of these gurus come out bragging when they catch small countertrend moves but how many have actually played the main trends for even a portion of the time? If they are selling their abilities to call tops and bottoms then you would have to expect that they participated in at least some of the current trends. If not, then why would you believe that they will be able to get you aboard the next major trend change?

    Aug 28, 2015 28:27 PM

    The market has just been following oil the past 2 days with perfect correlation. The Fed could just support oil to keep the market healthy.

    Aug 29, 2015 29:06 AM

    I was just looking at the 1999 events ingold for another blog post:

    The low in gold was (on the gold fix) 252.80 on 20 July 1999. The pop up in gold was in September/October 1999 to $326.25 on 5 October 1999. Gold was back at $255.95 by 2 April 2001. It was nearly a 2 year bottoming process on that basis but was actually even more spread out. So patience is going to be needed!