Jesse's Café Américain Sun 2010-05-09 09:08 EDT

PLUNGE! 1987 Style Sudden Drop in US Stocks Driven by Program Trading and a Ponzi Market Structure

Jesse

US equities were gripped by panic selling as the Dow plunged almost 1,000 points driven by a cascade of 100 share high frequency program trading, estimated to have been about 80% of volume. Gold rocketed higher to $1,210...This is highly reminiscent of the 1987 crash driven by a flawed market structure based on automated trading and bad theories. The entire stock market rally which we have seen this year off the February lows resembles a low volume Ponzi scheme, and formed a huge air pocket under prices. This US equity rally was driven by technically oriented buying from the Banks and the hedge funds. There was and still is a lack of legitimate institutional buying at these price levels. This was machine driven speculation enabled by the lack of reform in a system riddled with corruption...

1987 Style Sudden Drop; Jesse's Café Américain; plunge; Ponzi Market Structure; program-trading; Stocks driven.

Sun 2010-02-28 12:06 EST

THE PRAGMATIC CAPITALIST >> Buffett Partnership Letters

Warren Buffett

February 1959 Letter February 1960 Letter January 1961 Letter July 1961 Letter January 1962 Letter July 1962 Letter December 1962 Letter January 1963... (THE PRAGMATIC CAPITALIST)

Buffett partnership letters; pragmatic capitalists.

Unqualified Reservations Fri 2009-12-18 10:03 EST

Expiring liquidity facilities: bad plan, Stan

Mencius Moldbug

I predict: serious financial disturbances will occur on or before February 1, 2010. Or soon thereafter...I also have a serious - ie, verifiable - prediction. I predict that before the end of 2010, probably well before the end of 2010, possibly even before the beginning of 2010, the Fed will be forced to renew these facilities or others like them. In other words, I predict that its attempt to kick the liquidity junk will not succeed. In the end, I believe all these "temporary" facilities will become substantively permanent - just like the original LF, deposit insurance.

Bad plans; Expiring liquidity facilities; Stan; Unqualified Reservations.

Wed 2009-12-16 15:41 EST

Steve Keen's DebtWatch No 31 February 2009: ``The Roving Cavaliers of Credit'' | Steve Keen's Debtwatch

``Talk about centralisation! The credit system, which has its focus in the so-called national banks and the big money-lenders and usurers surrounding them, constitutes enormous centralisation, and gives this class of parasites the fabulous power, not only to periodically despoil industrial capitalists, but also to interfere in actual production in a most dangerous manner-- and this gang knows nothing about production and has nothing to do with it.'' [Karl Marx] Marx's analysis of money and credit, and how the credit system can bring an otherwise well-functioning market economy to its knees, was spot on. His observations on the financial crisis of 1857 still ring true today...

31 February 2009; credit; Roving Cavaliers; Steve Keen's Debtwatch.

Fri 2009-07-24 00:00 EDT

naked capitalism: Guest Post: AIG CDS Unwind Goes From Waterfall To A Trickle

*** banks' fixed income trading desks generated phenomenal profitability in January and February hadnothing to do with actual trading of fixed income and everything to do with AIG's hamheaded (and loss-generating) unwind of its CDS book''

AIG CDS Unwind Goes; Guest Post; naked capitalism; trickle; waterfall.

Tue 2009-04-21 00:00 EDT

naked capitalism: Guest Post: The Banks Were Profitable In January And February Thanks To... AIG

by Tyler Durden; ``phenomenal scam...continues unabated in the financial markets, and now has the full oversight and blessing of the U.S. government, which in turns keeps on duping U.S. taxpayers into believing everything is good''

AIG; bank; February Thanks; Guest Post; January; naked capitalism; profits.

Tue 2009-04-21 00:00 EDT

Calculated Risk: LA Port Import Traffic Collapses in February

Calculated Risk; February; LA Port Import Traffic Collapses.

Wed 2009-04-01 00:00 EDT

Hussman Funds - Weekly Market Comment: The Economy Needs Coordination, Not Money, From the Government - February 23, 2009

2009; Economy Needs Coordination; February 23; government; Hussman Funds; money; weekly market comments.

Thu 2009-02-26 00:00 EST

Hussman Funds - Weekly Market Comment: How to Climb Out of the Global Financial Hole - February 17, 2009

John P. Hussman

2009; climbed; February 17; global financial hole; Hussman Funds; weekly market comments.