Posts Tagged ‘buying stocks’

Should Investors Boycott the Stock Market?

Should Investors Boycott the Stock Market?

Courtesy of Frederick Sheehan of AuContrarian Blog

Investing in stocks is marketed as believing in America. Imbedded is the assumption that buying stocks is a fair deal. An investor might make or lose money, but the same chance was taken by all participants.

Although they have received little notice, the recently released 2004 Federal Reserve Open Market Committee (FOMC) transcripts show how the Fed was channeling its attention and distorting markets for the benefit of favored institutional investors. (See AuContrarian.com "blog" The 2004 Fed Transcripts: A Methodical, Diabolical Destruction of America’s "Wealth".) The 2004 Transcripts were not so much a revelation as a confirmation. The Fed’s valiant attempt to prevent the economy from deflating (its claim at the time) by inflating asset markets is now a matter of public record. FOMC members explicitly stated they were working with hedge funds and pushing housing prices up.

We know how this ended. The Fed’s policy was successful until 2007. Then all asset prices collapsed, along with the institutions (banks and brokerages) that believed the Fed could prevent prices from ever falling. The backstop was known as the "Greenspan Put:" the belief that Chairman Greenspan’s Fed would always prevent market prices from falling.

A put option gives the buyer an option (a choice) to sell a security at a price previously negotiated with the seller. A put option is valuable if prices fall below the level of the negotiated price. An investor can buy a put with the right to sell the S&P 500 Index at 800. If the Index rises to 1100, the option is worthless. (Why sell it for $800 when it can be sold in the market for $1100?) If the S&P 500 Index falls to 600, the value of the put option is worth at least $200 to the owner of the put: the Index is trading for $600 but can be sold for $800. The put option is an insurance policy against a stock market collapse. The need for the average investor to understand such instruments will be discussed below.

The Greenspan Put begat the Bernanke Put, once the latter became chairman in 2006. Believers in the Put have reason for such faith. The 2004 transcripts show the FOMC toiled to fulfill this zeal. The zealots ignore the failure of the Put in 2007 and 2008.

The credit collapse of 2007 and…
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Is Blackrock Buying the US Equity Market?

I asked Tyler at Zero Hedge about this and he explained that Blackrock is probably aggregating its ETF exposure by buying iShares which it now owns.  In other words, it’s netting out existing (short) ETF exposure and hedging by going long the stocks.  Blackrock’s net exposure is likely negligible.  - Ilene  

Is Blackrock Buying the US Equity Market?

Courtesy of Jesse’s Café Américain

One might conjecture from this enormous number of 13G filings noted below that Blackrock has taken what appears to be new 5+% stakes in over 1,800 US equities.

"We counted over 1,800 13Gs that Blackrock dumped on Friday…For those less familiar with the 13G…it’s a requirement when ownership exceeds 5% of the outstanding shares…these filings represented new positions for Blackrock since we only counted 11 amended 13Gs, which in itself seems very surprising, given the long list of stocks."

Holy guacamole!

Perhaps this is an error, or a misreading of the data. Someone ‘fat-fingered’ the Edgar filing button.

We are incredulous that a private investment firm, no matter how well connected, could have taken 5+% positions in most of the NY listed equity market so quickly. Driven madly bullish, with enormously deep pockets, and an abiding faith in their ability to defy the odds? Facilitating the hostile takeover of the rest of US real economy by a cabal of bonus taking Bonapartes? Starting a new Blackrock 1800 index fund from the bottom up, build it and they will come? LOL

Certainly the SEC will inquire as to their intentions, which is the purpose of such filings, and an explanation to the investment public will be forthcoming.

We suggested the other day that Blackrock and the NY Fed might turn out to be Obama’s Halliburton and KBR – private contractors fulfilling administration policy. NY Fed Conspired to Hide Details of AIG There are repeated rumours of an invisible hand in several markets, as an arm of Washington. But this is a bit much.

The Robert Rubin Rule of Financial Crisis Management was stated in the mid 1990′s. It held that buying SP futures to prop the stock market was cheaper than trying to clean up the mess after a stock market panic. But this was not about actually buying the market; it was about using price to manage perception, in the manner recommended by Edward Bernays. 

"The


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Zero Hedge

The Myth Of The "Great Cash Hoard" Of 2019

Courtesy of ZeroHedge View original post here.

Authored by Lance Roberts via RealInvestmentAdvice.com,

Tell me if you heard this one lately:

“There’s a trillion dollars in cash sitting on the sidelines just waiting to come into the market.” 

No.

Well, here it is directly from the Wall Street Journal:

“Assets in money-market funds have grown...



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Kimble Charting Solutions

Are Bank Stocks Sending Bullish Message To Investors?

Courtesy of Chris Kimble

Just as the health of the banking sector is a big deal to the economy, it’s equally important to the S&P 500 (SPY) and broader stock market.

Although the bull market has grinding higher, it’s awaiting confirmation from the banks and banks stocks.

Today’s chart is of the S&P 500 Bank ETF (KBE) and shows how the banks are at an important juncture in time and price.

KBE (the bank ETF) is testing the upper end of a falling channel, offering bulls an opportunity for a breakout – see point (2).

The banks were at a similar juncture nearl...



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Phil's Favorites

BIS Drops a Bombshell: Four U.S. Mega Banks Are Core of Repo Loan Crisis

Courtesy of Pam Martens

Wall Street Mega Banks Are Highly Interconnected: Stock Symbols Are as Follows: C=Citigroup; MS=Morgan Stanley; JPM=JPMorgan Chase; GS=Goldman Sachs; BAC=Bank of America; WFC=Wells Fargo. (Source: Office of Financial Research.)

By Pam Martens and Russ Martens

Yesterday, the Bank for International Settlements (BIS) dropped a bombshell report that torpedoed the Federal Reserve’s official narrative on what has caused the...



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Insider Scoop

KalVista Shares Sink On Failed Mid-Stage Study Of Diabetic Macular Edema Drug

Courtesy of Benzinga

Shares of thinly-traded micro-cap biotech Kalvista Pharmaceuticals Inc (NASDAQ: KALV) are seen moving to the downside Monday.

What Happened

Massachusetts-based KalVista, which focuses on developing small molecule protease inhibitors, said a Phase 2 study that evaluated its KVD001 in patients with diabetic macular edema, who were poor responders to previous treatment with anti-VEGF t...



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Digital Currencies

The Road To Retirement: Millennials Put Their Faith In Bitcoin But Goldman Says Go With Gold

Courtesy of ZeroHedge View original post here.

"Drop Gold" - the ever-present tagline of Grayscale's Bitcoin Trust TV commercial - appears to be working its magic on a certain cohort of society.

2019 has seen assets under management in GBTC soar...

Source: Bloomberg

And for Millennials, according to the lates...



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Lee's Free Thinking

Chart Shows the Fed Ramping Up Not QE - Funding Almost All Treasury Issuance

 

Chart Shows the Fed Ramping Up Not QE – Funding Almost All Treasury Issuance

Courtesy of Lee Adler, Wall Street Examiner 

The Fed is ramping up “Not QE” .

The Fed bought $2.2 billion in notes today in its POMO, “not QE,” operations. Actually $2.15 billion because they sold back a whole $50 million. Must have been a little glitch in the force.

This brings the Fed’s total outright purchases of Treasuries to $170 billion since it started Not QE, on September 17.

It also did $107 billion in gross new repo loans to Primary Dealers to buy Tre...



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Chart School

Silver stock taking the sector higher

Courtesy of Read the Ticker

As the US economy begins to show late cycle characteristics like: GDP slowing, higher inflation, higher wage costs, CEO confidence slump. 

Previous Post: Gold Stocks Review

The big players in the market are looking for the next swing off good value lows. This means more money is finding it way into the gold and silver sector, and it is said gold and silver stocks actually lead the metal prices.

The cycle below shows prices are ready to move in the months ahead (older chart re posted).


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Members' Corner

Sacha Baron Cohen Uses ADL Speech to Tear Apart Mark Zuckerberg and Facebook

 

Sacha Baron Cohen Uses ADL Speech to Tear Apart Mark Zuckerberg and Facebook

By Matt Wilstein

Excerpt:

Sacha Baron Cohen accepted the International Leadership Award at the Anti-Defamation League’s Never is Now summit on anti-Semitism and hate Thursday. And the comedian and actor used his keynote speech to single out the one Jewish-American who he believes is doing the most to facilitate “hate and violence” in America: Facebook founder and CEO Mark Zuckerberg.

He began with a joke at the Trump administration’s expense. “Thank you, ADL, for this recognition and your work in fighting racism, hate and bigotry,” Baron Cohen said, according to his prepared...



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The Technical Traders

VIX Warns Of Imminent Market Correction

Courtesy of Technical Traders

The VIX is warning that a market peak may be setting up in the global markets and that investors should be cautious of the extremely low price in the VIX. These extremely low prices in the VIX are typically followed by some type of increased volatility in the markets.

The US Federal Reserve continues to push an easy money policy and has recently begun acquiring more dept allowing a deeper move towards a Quantitative Easing stance. This move, along with investor confidence in the US markets, has prompted early warning signs that the market has reached near extreme levels/peaks. 

Vix Value Drops Before Monthly Expiration

When the VIX falls to levels below 12~13, this typically v...



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Biotech

Why telling people with diabetes to use Walmart insulin can be dangerous advice

Reminder: We are available to chat with Members, comments are found below each post.

 

Why telling people with diabetes to use Walmart insulin can be dangerous advice

A vial of insulin. Prices for the drug, crucial for those with diabetes, have soared in recent years. Oleksandr Nagaiets/Shutterstock.com

Courtesy of Jeffrey Bennett, Vanderbilt University

About 7.4 million people ...



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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

...

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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About Ilene:

Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

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