http://market-ticker.denninger.net/
Remember the movie "War Games"?
"SHaLL we PLAY A GAME?"
THERMAL NULCLEAR WARFARE
Those freaky launch strike screens come to mind.
Yeah sick association I know, but if you think about all those "stop sets" going off as a nuclear launch in someones life, you can see how I got that picture.
The games rigged people and today shows you just how rigged it is.
Karl says you have no recourse.
My mind says BULLSHIT.
This was HUMAN ERROR, who the hell was running the programs?
high-frequency trading and direct-exchange connected computers
The DOW (and other indices) dropped hard. The response in the computers connected directly to the exchanges was instantaneous and produced this:
A computer-driven bid collapse followed and the result was a more than 1,000 point selloff.
I'd be suing somebodies asses BIGTIME. This kind of thing ain't no different than the Honda thing. It's time to MAN up (now that corporations are equal to a human entity), they need to own up to the financial harm that they imposed upon others through there insatiable need to feed their greed.
The buck stops WHERE?
This sort of thing has to be stopped.
This was not humans - it was pure computer algorithm trading. If you had stops set, you got blown out way below any reasonable trading range with no recourse. Margin requirements were raised instantly on futures which sure didn't help.
This was essentially the 1987 program-trading crash powered by the fastest CPUs money can buy, and points out that these systems do not have social utility and at times like this they are unbelievably destructive.
The banks and others who have argued for innovation have just proved once again that their brand of "innovation" means that the average investor gets bent over the table. You cannot, as an investor, be in the market until these outrageous practices are permanently barred from the exchanges.
I was on the right side of the destruction today, but I could have very easily been on the wrong side and gotten badly hurt. As it stands I'm quite certain there were tens of thousands of individual traders who went so far into negative equity in the futures market and got immediately liquidated that we will be hearing of blown up accounts and bankrupted traders for weeks if not months.
To those who say that we have "restored confidence" in the markets and "the worst is beyond us", I want everyone to remember very carefully the early 2007 market collapse that originated in Asia and came over here - the event that began my writing of The Ticker.
When governments tamper with markets as has been done over the last year and change to the point that true liquidity leaves and is replaced by computer-driven volume, this is what happens as there is NO UNDERLYING BID.
VOLUME IS NOT LIQUIDITY. Liquidity creates volume but not the other way around. We have deluded ourselves into believing that a handful of major banks passing shares between each other funded with zero percent loans equals "liquidity."
Showing posts with label Dow Jones. Show all posts
Showing posts with label Dow Jones. Show all posts
Thursday, May 6, 2010
Saturday, May 30, 2009
The Second Crash -On the Way and Unstoppable
http://www.321gold.com/editorials/casey/casey052909.html
Tuesday, October 9, 2007 started as a nice day in New York City. A lovely early fall day, with the temperature still a balmy 80° at 2:00 in the morning. By evening, though, the temperature had dropped twenty degrees, the clouds had rolled in, there was thunder and rain.
As with the weather, there were some hints of trouble here and there on Wall Street. But all in all, things could not have seemed better. Little did we know, the stormy end of 10/9/07 signaled a very large bubble that had just popped.
That was the day when the Dow Jones Industrial Average hit its historic peak. From there, it was all downhill - slowly but steadily at first, and then violently after last August - until the Dow bottomed (for now) on March 9 of this year. Over that span, the index lost 54% of its value.
It's been a crushing blow to just about everyone. But it's already being referred to as the crash. As if the unpleasantness were now all behind us. More likely, in the future it will be seen as, simply, the first crash.
Don't believe it? In a moment you will, when you see the scariest graph of the year.
But let's quickly recall
Tuesday, October 9, 2007 started as a nice day in New York City. A lovely early fall day, with the temperature still a balmy 80° at 2:00 in the morning. By evening, though, the temperature had dropped twenty degrees, the clouds had rolled in, there was thunder and rain.
As with the weather, there were some hints of trouble here and there on Wall Street. But all in all, things could not have seemed better. Little did we know, the stormy end of 10/9/07 signaled a very large bubble that had just popped.
That was the day when the Dow Jones Industrial Average hit its historic peak. From there, it was all downhill - slowly but steadily at first, and then violently after last August - until the Dow bottomed (for now) on March 9 of this year. Over that span, the index lost 54% of its value.
It's been a crushing blow to just about everyone. But it's already being referred to as the crash. As if the unpleasantness were now all behind us. More likely, in the future it will be seen as, simply, the first crash.
Don't believe it? In a moment you will, when you see the scariest graph of the year.
But let's quickly recall
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