Why shouldn't the government openly purchase securities such as equities or derivatives ?

reply to post by ATS4dummies


That is a good one, but taking into consideration how things works, the government should not have ownership of corporations right? but as today corporations actually runs the government.

While the only money that government should take from the hard working class is for infrastructure and defense, we the people now have to support the failing corporations after they cause economic crisis in the nation and globally.

Still everybody complains that we have to reform health care that is growing like a monster and sucking everything, but nobody in Washington is complaining about the growing eating monster that has gotten fat and lazy under privatization, the military complex that most of the budget ends in the hands of private corporations

Still the government doesn't have to "buy anything because already it has the tax payer money bind to be wasted an abused by those in power.

So in other words let the corporations run free and make mistakes while the tax payer will pay for it at the end.

What I want is the taxpayer to make bank and I want our government to start running this program where we the taxpayer profit.

This is just the craziest idea. A stock market doesn't work when someone announces they're going to buy x trillion dollars of equities. You would get a huge short squeeze and spike in the market at which point the smart money would unload it all on the average joe just as he's hitting the buy button. It would CRUCIFY the public not help them.

reply to post by GreenBicMan


For one thing, government directly interfering with the entire market would be the definition of socialism. If you're cool with that...

reply to post by mythatsabigprobe


Why would you sell into government intervention?

Shorts would be wiped out - if you reread the OP I already stated that would be a tough consequence but those are the risks you take when your hypothetical loss is infinity. Thats called Market Risk, and you have to deal with it

EDIT: You could actually make a case for selling into it I suppose - there could actually be many reasons I retract that

[edit on 6-2-2010 by GreenBicMan]

reply to post by seattletruth


I dont care what I am labeled as long as we make money.

reply to post by GreenBicMan


The problem is that in America no longer the littler man is allowed to actually proper in invention and free will, that is now the exclusive rights of the powerful running the nation behind the government.

It was a time when we the people could have done many things to stop what is going rampant in the nation when it comes to division of classes and allocations of power, but now we are all under their foots.

The government, now a corporation run by corporations doesn't need permission from the people anymore to do as they wish with the American tax payer money so why would the government even take into consideration allowing something to benefit the hard working class at all.

reply to post by marg6043


Thats right.

I want to take that back and give the power of manipulation to us.

Imagine getting a paycheck from Tiny Tim every month for $1500. This is in addition of course to your normal work wages you earn.

I cannot disapprove of that.

reply to post by GreenBicMan


Neither me, but as you know the government takes and takes and actually doesn't give anything back.

I laugh when people makes such a big deal about getting money from the government either with stimulus (that we have to pay at the end) or with tax returns, ( after all it is you hard earned money that the government is taking while making profits on it during the tax year, you get yak)



[edit on 6-2-2010 by marg6043]

reply to post by marg6043


Heres the deal.

We dont give ****, but we take.

We basically finance our own debt in reality anyways, this is just the icing on the cake.

reply to post by GreenBicMan

Friday IMO was a case of people covering right when Dan Hoenig was speaking about interest rates

I see 100+ moves on the DOW in a matter of mins being suspect.. I don't think there was a universal waiting for Dan to speak about Interest (which everyone knew wasn't going anywhere anyways..) to make a move. It was a big, big money, moving very fast.

Coulda been banks. Could been the PPT, if there is even a difference between the two.. or it coulda been everyone collectively, though I doubt it.

Regarding this topic I really do not see the downside to intervention in markets if all news is disclosed before it happens

If you disclosed before hand (well today we are going to be X, and sell Y) then everyone would trade accordingly to reap profits. It would be insider trading made public. The down side is quite obvious: It's money that wasn't there to begin with, increasing general capital which consolidates at the upper tiers of the economy, decreasing the buying power of the lower tiers, while simultaneously increasing prices in general due to direct inflation.

That debt number you hear is make believe.

It's not make believe at all?

A portion of our budget "services" debts.. for every dollar we borrow, we pay a percentage. Granted, right now the percentage is very low.. if it were higher, the yields would eat a larger percentage of our budget. But every dollar we spend on servicing the debt, is taken away from other aspects of the budget..

It also deteriorates our Dollar...

Debt should never be underrated.

reply to post by Rockpuck


I was referring to the derivative debt number, not national debt. That debt is make believe because they are calculating it with leverage. That doesn't make any sense.

Also, if you read my post on market thread, Dan Hoenig carries just as much weight as any Fed President, or more, because he is the only voting member doing such. EDIT : Voting to raise rates. He eased his rhetoric big time on the Dow Jones Newswire, I looked at that and then I looked at the TV and the market jumped immediately. I get the newswire service btw, so that's the only way I know that.\

EDIT x2:

Its funny though. When the market can drop in freefall nothing is nefarious. Dow jumps 100 points in 5 minutes and its PPT. It doesn't make any sense, especially on a Friday where no one wanted to be short going into PIIGS etc.

I want to announce it beforehand to let the market rally. That is my plan. It is going to be like Big Ben and Ill say Im going to pump in 5 trillion dollars over an "extended period of time". Same exact thing goes on today in my eyes, maybe it just happens a little bit. Only difference is I want paychecks coming to us not them.



[edit on 7-2-2010 by GreenBicMan]

[edit on 7-2-2010 by GreenBicMan]

[edit on 7-2-2010 by GreenBicMan]

It is for the same reason why lottery officials are not able to play the lottery.

Second line.

reply to post by TruthWithin


No, we are just financing our own debt, and letting be purchased in our markets by foreign entities. Think about it. It's just a semi revised plan of what we are doing right now.

In addition, I dont think its insider trading when everyone profits on it in the USA month by month.

[edit on 8-2-2010 by GreenBicMan]

reply to post by GreenBicMan

When the market can drop in freefall nothing is nefarious

Good point. Cannot deny it. Though I'd say any movement (that fast) is probably consolidated money, somewhere, most likely a bank.. they move the markets.

Also, I completely agree with the derivatives. Margin Trades are actually lumped into the Derivative Market definition .. the number is highly inflated, if even correct at all.. it's an estimate.. Most of the truly dangerous derivatives are so complex and interwoven, not to mention secretive that no one knows who bad the real problem even is. Especially since the Feds have been doing their best to eat everything up to hide it from the markets.

reply to post by Rockpuck


It's just a number for media to mull over.

IMO here is what happened.

There were a lot of resting buy stop orders sitting at a certain area close to where that climb was. It was pretty obvious someone went "fishing" and took them out. There was a span of wicked volatility after that from 0 to -40 like 2-3 times.

Either someone was making a statement, or there was a real tug of war there. I think that is totally psychology of the herd and nothing more. It could have been someone getting liquidated as well. That happens a lot on ES (Mini SP 500)

You also have to think on a Friday before all of this stuff possibly going down this weekend, think about if you were an institution with 10 million shares short of IBM sitting on the table. You would probably want to take half that risk off the table especially when you could buy it back at the lowest price of the week.

We formed a high volume hammer. Expect a big Monday IMO.

[edit on 8-2-2010 by GreenBicMan]

Yo, Greenski, it can't happen like that because...........

...T + 3! The brokers gotcha by the short hairs. Now don't it?

Money supplies always increase in order to keep the game in motion. The ''game'' ultimately is to control the holders of your currency. You want people bonded to you. You want people beholden to you. To do this you want to keep inflating the money supply in order to keep the motion steady within your borders, and also to get new folks hooked outside your borders. The country that can hook the most users is going to be the winner ultimately in the Earth control contest. You have to make more money available to current and prospective game players all the while maintaining the illusion of steady value.

You've got natural population increases inside your border, and you've got new players brought online outside your borders, which require you to print more money so everybody can have some to spend. And you've got those people who are the best at attracting money and they will accumulate it, while most people just rotate it through their personal accounts from payday to payday and accumulate little. So most stay broke while the best players get more and more money in their accounts. These black holes of money attraction take money out of the pockets of the little guys. So you've got to constantly be putting more money into circulation in order to keep the flowing going with government paychecks, welfare checks, military checks, bank loans for building, etc.

Remember you have to control the money supplies rate of increase, and sometimes temporary decrease, in order to steer the game for best game play, always keeping in mind that supply inflation causes people to doubt the worth of their currency. You have to constantly keep people hooked on the idea that the currency is worth something in relation to what they thought it was worth yesterday. A new car isn't $4000 anymore, but then again an engineer doesn't get paid $8000 per year anymore either. So in a way the Fed has managed to keep the game going while everybody still believes that the currency is worth what it used to be worth. Only the numbers have inflated. But the life you buy is still about the same across the board.

Pumping unlimited money into the stock machine will mess up the game play because the rate of inflation would be so astronomical you would end up devaluing the currency. You can't inflate the money supply too quickly. It has to be paced in a somewhat natural manner, abstract but natural. The amount of money that would be necessary to constantly drive the stock market up would be ''unlimited'' and that would just not do. That would cause the whole game to fail. Plus you can't push the market up like that. The market pushes down. Remember Bull and Bear? Mr. Bull is irrational and jumpy and easily incited. Mr. Bear is more cunning and ultimately more powerful. When brokers have the ability to ''naked'' short you simply can not put enough money in to keep the market going up against the wish of the brokers. Get it? The brokers run the stocks. You CAN NOT drive a market higher if the brokerages want to take it down. The central banks and governments of each country run the money supplies and compete with each other for the most attractive living arrangements and most satisfied, productive and beneficial populations. The brokers run the stock market. It is a capital gathering machine that attracts currency towards those who believe themselves to be the best stewards. The stocks don't make currency. They take currency. You can't just keep pumping it in with reckless abandon without catastrophic effect.

Call the time ''T''. Start the Bid at $10 and the Ask at $11.

I'm a broker. The first thing I do is go short and hit the Bid for $10. I now have $10. I am only one single broker though, and the other brokers are ganging up to take the market higher. I'll catch on eventually, but for now I'm going to have to play catch up. The market closes at $11/$12. That's T.

Now it is the next day. This is T+1. The market opens at Bid $11, Ask $12. The first thing I do is hit the bid for $11. Now I have $10 from yesterday and $11 from today, for a total of $21. The other brokers are still going higher though. They want the market at Bid $12/Ask $13. Oh well, tomorrow is another day.

Now here it is the third day, T+2 for me and my first short sale. The market opens at Bid $12, Ask $13. The first thing I do is go short some more and hit the bid for $12. Now I have $33 in my account and I am keeping track of three short sales at $10, $11 and $12. The other brokers are still going higher. Market closes at Bid $13, Ask $14. If forced to cover all my shorts at the asking price of $14 I would be liable for 3 x 14 = $42. All I have is $33. Oh well, tomorrow is another day.

Alright. Day four. The day of reckoning has arrived. It is now T+3 for me and my first short from $10. The market gaps like crazy and opens at Bid $17 and Ask $18. Who cares? Not me. I'm having fun. The first thing I do is short again hitting the bid twice for $34 (17 x 2). Now I have $67 in my account. I've got to settle my first short from $10 so I cover at the asking price of $18. Now I've got $49 in my account and the game continues. I have more and more cash, more and more shorts, a higher and higher price, and when the other brokers finally decide to take the market down I will learn a bit and make a killing.

EDIT: This is a really simplified example, but remember, I'm a broker so I'm holding all the cards (ie. all my customers' cash and stocks) and I can balance my book as long as nobody demands too much cash withdrawal. Most people buy and hold stocks, so I'm safe. At least until there is a major run on my brokerage operation.

[edit on 8-2-2010 by Cabaret Voltaire]

You know I've got my own ideas, but here is an interesting article by Charlie Tarango about self-delusional Bulls.

"The basic attributes of a Bear Market Rally are all present today. The belief that they will wreck the system to protect the Participants is purely Self-Delusion. In the Zero-Sum game of Markets, ask 100 Participants if they will be in the 1%"

"Capitalism is the Voluntarily Transfer of Wealth from the Hands of the Many to the Hands of the Few – where anyone can become one of the “Few” – and some do – no matter how unlikely."

"Here again, Jesse Livermore's words of wisdom are instructive – and applicable to “Capitalism” as a whole. The “Mark-Up” ( the long slow Inflation ) is the set-up – but the real Money is actually made on the downside as it is liquidated ( the Deflation ) – contrary to popular belief."


[edit on 8-2-2010 by Cabaret Voltaire]

find a way to make this plan favor the big politcal donators and it may then have a snowball's chance

risk appetite (equities) is waning for now

quotes.ino.com...

and we can argue about PPT till the cows come home....but hoening talking about interest rates ....really? rates will stay very accomodating for an extended period.....the market knows this.....

I want people to think about the following...stop and think

the 10,000 level is psychologically important to the treasury /fed/admin/ corporations.... to maintain the illusion that we are recovering....WHICH helps determine people's future EXpectations...and thus influence their Consumption/spending....thus avoiding the "death spiral in jobs and spending" is this rocket science? really now ......

and no it doesn't make joe 6 pack ....go out and buy a ferrari....but we are talking about....enough to make a significant swing (3-6%) in GDP ....not to mention HELP avoid a reinforcing cycle of demand decrease (less spending....more unemployment...etc)...and this is BEN's ....damn Gaurantee promise to the big wigs....he will not let asset deflation happen as he sits on his butt....he will do whatever it takes to avoid that



[edit on 8-2-2010 by cpdaman]