How the stock market is manipulated by insiders

The manipulations are more obvious now, futures are played with in conjunction with stock trades to drive in prices in a desired direction, market fundamentals, logic, and an semblance of ethics be damned,

One can achieve a comfortable margin of safety by working with other hedge funds to go long or short the identical stocks and futures in concert.

Today it’s clear that the market transactions may have less to do with an asset’s actual valuation in a normal trading environment than with its desired valuation in a manipulated one.

It’s a true tail wagging the dog phenomenon that enriches well-placed gamblers at the expense of everyone else.

I’m not trading much now. The manipulations are so obvious (and unrelated to reality) that it seems pointless to try to understand what’s happening, much less place an intelligent trade.

7 Comments

  1. I thought everybody knew that the stock exchanges were no more than large gambling casinos for the rich. What chance of honest assessment when millions can be made by manipulation, this is capitalism, that’s how the markets work, it is not about ethics and morals, its all about money and getting very, very rich and to hell with the others. Believing it to be other than this is rather shallow thinking.

    • I tend to agree with Sharif Abdullah: the stock market is by definition NOT capitalism, precisely because of those features John mentions. But it wants us to believe it is inherently capitalist. Capitalism (as Adam Smith saw it) is by definition regulated and oriented toward the benefit of society as a whole. That’s not Wall Street.

      The entire top tier of government, finance, and Wall Street looks more like feudalism these days than it does capitalism– benefit the rich at the expense of the poor (and anyone else in their path). But then, it’s been some time since we practiced anything like capitalism at the national level in this country.

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