Skip to comments.Is the U.S. stock market rigged?
Posted on 03/31/2014 12:26:58 PM PDT by C19fan
This month marks the fifth anniversary of the current bull market on Wall Street, making it one of the longest and strongest in history. Yet U.S. stock ownership is at a record low and less than half of Americans trust banks and financial services. And in the last two weeks, the New York attorney general and the Commodities Futures Trading Commission in Washington have both launched investigations into high-frequency computerized stock trading that now controls more than half the market.
(Excerpt) Read more at cbsnews.com ...
Saw them talking about this on FOX this morning too.
The consensus was yes but tough noogies.
Is the pope catholic?
All this is no where near as important as the central bank bubble, though.
From a long lost Day Trader....”The Masses Lose their A**es”
NYSE: A well developed con job
That’s kinda the whole base philosophy of stocks.
Manipulation, timing, luck, and even a little actual reality for show.
My chances would be better at a casino.
There is a distinction between small stock investors who buy and hold for long term gains, and small traders, who aim to make many small, quick gains and must compete with the market distorting manipulations of large traders. Cautious small investors can do well, sometimes remarkably well.
I don’t think it’s really rigged. The HFT traders do make profits. In effect, they skim a bit, and I think the practical effect of this is to widen the bid-ask spread a bit. The market is still a lot more fair than 30 or 40 years ago when there was a mandatory bid-ask spread quoted in fractions of a dollar, and the brokers pocketed the difference. Now, the brokers and market makers are dealing in penny spreads... and yeah, the HFT guys pick up some... but regular investors are a lot better off than they used to be.
Don’t forget about the stimulas money that banks get for negligible interest rates to use for free in the stock market to make billions . When it all comes crashing down it won’t be pretty.
Long term buy and hold with dollar cost averaging has left me with more net worth than if I had put the money in the bank or CDs all these years.
Yes, the past 13 years have been pretty miserable as a buy and holder, but so have banks and CDs.
And yes, the market is rigged, which is where the big profits are. It is there for the big corporate guys to rob the small investor, like in 2008-2009, when so many small investors sold short, pulling out their money when the market was way down.
People that stayed all in when the market was down came out fine. In my case, I got all out at around the peak and stayed out, so I am fine too.
But yes, the market is rigged and plenty of small investors get greedy too late to make good profits and scare too easily after big sell offs. They are basically buying high and selling low and transfer their money to the big corporate guys.
How so? If it trends up... or down... in a predictable manner... you can make a fortune anticipating it. I don't believe you can, though.
Can there be any doubt ?????????????????
Yeah it's wired for some. Just look at Congressmen's net worth before and after they leave DC.
Much more fair then when Joe Kennedy made a fortune kitting stocks.
Where do you think our trade deficit dollars end up? Our government penalizes the heck out of any foreign entity wishing to invest in a US business start up or real estate. Yet that same foreign entity can purchase stock online without being hit with all the regulation.
When you put Goldman Sachs in charge of our monetary system, you can expect them to rig the game in their favor.
The HFTs function as toll booths. They do their best to get a little bit out of each trade by front running it. Could be a nickle collected over billions of trades a year.
Front running means their computer program has ways of anticipating a trade. So the HFTs buy that stock and sell it to you for a few pennies more than you would have paid otherwise. This takes place in a fraction of a second.
Do this a millions of times a day and you are rich
YES..... people are buying stuff(actual assets) with currency created fiat.... out of nothing..
Almost as much cotton candy bull sperm as currently being inseminated by the White House..
Not as much but almost as much..
Hillary got “lucky” in the cattle futures market.
Many of our congressmen got “lucky” in the stock markets while in office. Enough to retire as millionaires.
Soros and other big boy billionaires know the markets inside and out and how to influence them.
It’s difficult to compete against insider trading and instantaneous computer-generated transactions.
If you know the markets better than these guys, go for it.
As for me, I’m going to play the lottery or casinos where I know my chances (statistically). Who knows, I might get “lucky”, if lightening strikes once or twice. /s
Of course it’s rigged. And this is the reason people started day trading.
It’s been years, but I read the biography of William Boyce Thompson, who had gotten rich as an owner of copper mines. He was a director of the Federal Reserve Bank of New York from 1914 to 1919 and was twice (1916 and 1920) a delegate to the Republican National Convention. He quit the mining business and had a seat on the New York Stock Exchange. He reportedly said he was going to New York to, “shear the sheep”.
I was reading about his involvement with the Red Cross mission to Russia. This was a means for Wall Street to finance the Bolsheviks.
Do institutional investors manipulate hysterical retail investors for profit in certain sectors? Absolutely!
That said, if you are not hysterical and are not easily manipulated, you can do well in ETF's (which own a basket of stocks). Of course, you must choose the right ETF.
I realized that in the late 60s early 70s. Things have just deteriorated since then.
The only real "option" for outsiders is through participation in large, well managed mutual funds.
Rigged? No. Heavily manipulated, yes.
Why buy and pay for mutual funds and their managers when you can buy the broad market, or the S&P, or the NASDAQ with an ETF which outperforms such mutual funds.
Oh, it’s true there are individual manipulative plays. But, I’m not sure they really matter. Stocks usually reach the floor if they’re worthless. But the market as a whole... I think it works.
One of the best things Graham said, repeated by Buffett, was that in the short run, the market is a voting machine; in the long run, it’s a weighing machine. I’m not a short-term trader, myself.
P.S. We know the markets are manipulated when Jim Cramer on live TV says he can tank Wal-Mart stock...then does.
I place my wife and myself in the "remarably" well class over the past 5 years and over the past 40 years, very well.
Perhaps the super rich do better over all but we are happy with our gains.
Buying a security is like betting in a casino. The house has the odds, but they occasionally allow someone to win in order to keep the suckers at the tables.
If I had made some small different choices I could have more money, but what would I have done with it?
It's not your brokerage firm, because they don't control stock prices. It's certainly not the companies who issue the stock, because their senior officers cash in their options when their stock performs well. It's not the institutional trading desks, because they are competing with each other to make a profit.
It must be the proverbial "they" or "them" that no one seems to know.
watch the gold market. almost every day, just before open, then fed dumps gold contracts to try and keep the price of gold down.
they don’t care about losing ‘money’... since they’re literally printing it.
“they”, “them” and “I don’t know” have been doggin me from the time I was little.
CBS News is rigged. I believe nothing CBS says.
THE Berlin Stock Exchange still existsas 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.
Now they hide my keys.
it’s not just the unseen movers. Little ole me could not help but notice when trading through Schwab when I bought something through them the transaction would always take 3 or 4 days. The settled price was always the highest quote for that period. When selling the contrary was always true. Stick it Chuck.
"Step right up ladies and gentlemen!!"
You have it right.
Traders with massive capability have an advaantage in the short and very short term.
Those who buy and hold are not substantially effected by that advantage. If you set the buy or sell price, you get what you want or don’t. Then , you try again.
no, not at all.
If you carefully search out and buy a mutual fund you will get a return much better than at the casino
Indeed. Cramer even admitted in an interview that he used CNBC to help manipulate prices of stocks in which he had a position.
I also watched the market depth activity (at Schwab) and set my order limit at a price which I like but which will get executed. If the market moves away, I make a decision to either raise the price by cancelling and re-entering the order or leave the order as is to see if the market comes back to me.
A limit order at a specified price will be executed at my price or better...or it will not be executed at all.
Once executed, the stock is mine, but the transaction settles over the next three days. In fact, if I want, I can resell the stock before the transactions settles.
In effect, they skim a bit, and I think the practical effect of this is to widen the bid-ask spread a bit.
The penny pricing has NARROWED the spread ,,, the NYSE hated to go to it because it put their people out of business (the market makers that have seats and their traders in the pits) and gave the profits to the huge HFT wirehouses... now there is basically no backstop to an out of control market is a bad trade is entered... say a price wrong by a few decimal points or a LARGE quantity that can’t be realistically filled..