So, today a new and huge intervention designed to save Europe was announced. Do you think that Central Bankers woke up this morning and decided to announce it the day before option expiration? Or perhaps this was formulated this past weekend at the G-7 meeting.
Nevertheless, at about 2pm on Monday afternoon, the American equity market began a two day move that has rallied the Transportation index up 10% and the Nasdaq Composite up 6%, in two trading days. Do you think this move was because “uppy is goody and downy is baddy”? Not a chance.
We function in a market environment that relies almost exclusively on government policy and intervention, more than any time in modern market history. The fact is that government at the highest levels and industry are intertwined. And as we have witnessed firsthand, shortly before a major announcement is made, markets stage unusual moves both on the upside and the downside. Today’s announcement is no different.
We live in a time where there is MORE INSIDER TRADING than at any time in modern history. But because it comes from the Government itself, nothing will ever be done about it.
So I suggest that every investor constituency hire a very high level international banker or ex-policy-maker to get the information firsthand and for themselves.
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Well written and needed to be said. Thanks Scott.
The good, the bad, and the insiders…
What?
You mean you didn’t get the e-mail?
😉
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Let the truth be told. Good stuff.
Nice blog entry.
If you can’t beat’em join’em
Huge intervention was/is quite predictable. You gotta get ahead of this stuff.
Remember back when the futures on Sunday were down over 300 points, and in the 10700 range? You were posting about someone calling you out and saying you missed the 8/8 bottom confirmation on 8/22? We’re 500+ points higher now. You were too busy trying to mimic Mauldin, Pritchard, Tice, Roubini, etc. etc. etc. They’re just trying to sell speech tours and books, and I’m sure they make no money from trading. How could they? You want to be in that company? Great. We’re going to S&P 1240 before the next correction, and we look weak at 1208 at this moment. Go ahead and buy TZA at $41. I’ll buy it in the mid-30’s.
Scott, SO TRUE. But, there has to come a point when the Govts can’t act, then we get our true bottom imho. BTW, Still looking for clues of a leak on the Fed meeting next week.