What, or who is holding the DOW up?

[ClintonTyree]

Economic news is dismal, at best. There are some companies that are meeting or exceeding the lowered expectations from earlier in the year, but as a whole the Market is full of companies treading water or losing ground. Consumer confidence is in a free-fall, fuel prices are taking a much bigger bite our of the family budget and heating oil and natural gas prices are going to skyrocket this winter. All this coming at the time of year when retailers usually depend on 80% of their yearly sales.

So, can anyone tell me why the Market is NOT in a nosedive? Are they getting ready for another swoon that will once again redistribute the wealth in this country, or are things NOT really that bad? I can't figure it out. I remember talk at DU after 9/11 of the mysterious "plunge protection team", ready to step in and save the market from certain doom. Do they actually exist? Are they at work now keeping the economy afloat?

Signed,

Confused

[bahrbearian]

1. The looted money out of Iraq?

[BlueEyedSon]

2. Government Intervention in Stock Market is Detailed by New Report, GATA Sa

http://biz.yahoo.com/bw/050906/65371.html?.v=1

Press Release Source: Gold Anti-Trust Action Committee

Government Intervention in Stock Market is Detailed by New Report, GATA Says
Tuesday September 6, 8:30 am ET

MANCHESTER, Conn.--(BUSINESS WIRE)--Sept. 6, 2005--A major Canadian financial management firm that a year ago published a compilation of evidence of central bank manipulation of the gold price has just done the same in regard to the U.S. stock market and has reached a similar conclusion.

The new report is titled "Move Over, Adam Smith: The Visible Hand of Uncle Sam," and has been published by Sprott Asset Management of Toronto. It was written by the firm's president, John P. Embry, and his assistant, Andrew Hepburn, and concludes that the U.S. government has intervened to support the stock market so many times that "what apparently started as a stopgap measure may have morphed into a serious moral hazard situation, with market manipulation an endemic feature of the U.S. stock market."

The new report relies largely on reports of news organizations and the essays and research papers of economics academics that, as might be expected, have not been well-publicized in the United States. But some of these reports have been circulated by the Gold Anti-Trust Action Committee over the years.

[ClintonTyree]

7. Wow, thanks for that!

This is worth some attention, thanks, it's exactly the sort of thing I'm looking for. :hi:

[cyberpj]

8. Damn - you had it right at your fingertips and I had to go find it! (wink)

Good that there are multiples of us keeping these articles.

[BlueEyedSon]

13. wink back atcha!

[Sparkman]

10. Just a note: Worst DJI chart since 1977, SIX years of flat and down trend!

What ever is being done to bolster our manufacturing base has the result of ARTIFICIALLY CREATING DEMAND, and has government backing.
Like military ordinance at 600 times their equivalent commercial sector values, and huge deficit spending...wait that's obvious!

[ClintonTyree]

18. Do we even HAVE a manufacturing base anymore?

Are you saying that military spending is keeping it afloat? I'm tech-talk challenged, I don't understand a lot of the vernacular associated with economics. ;)

[Sparkman]

15. Don't stand too close to those guys over at Sprott Asset...the wrath of *

John P. Embry best git his miiiind raught, er else.

[ClintonTyree]

23. Could you translate that........

for someone who is tech-talk challenged? :shrug:

[Sparkman]

26. just a casual comment: David v.s. Goliath & CAN Gold at 18yr high=exposure

Canadian lumber and Gold are commodities that can be targeted for retaliation by * forces, and isn't Can barred from Iraq contracts, unoffically.

[DinahMoeHum]

3. Methinks it's the real estate market, but that bubble could bust

at any time.

:shrug:

[ClintonTyree]

14. I forgot all about the real estate market.........

if (or is it more a question of when?) that bursts the whole economy will go down the crapper for sure.

[tnlefty]

30. Exposing my ignorance for sure here, but if my house is paid for

and appraises at roughly $200K how will the housing burst effect me?

[Sparkman]

31. Same way stock holding would, IF YOU SELL or BORROW on equity only.

We typically have deflationary recessions/depressions every 30 or 60 years (a generation's cycle). IF a panic buys up most of the goods on shelves, during a recession, we could have that feared
INFLATIONARY DEPRESSION=stagflation. when nobody has any money and the few goods in demand are inflated hugely.
I suppose many third worlders can't afford to purchase much of their own national product, and that's no fun.

A recession is around 3 consecutive down quarters, with lower cost goods, the normal recession (disinflation). The "brilliance" behind a government insurance program like the Central Bank lowering interest rates or the Fed. deficit spending, it lends confidence to the markets, fear is an enemy to markets.

What are we in now? I bet the neo-cons are working over time to hide the truth from the U.S. public about the economy as well as their new world order's state.

[Jon8503]

4. Wonder the same thing. I understand that there are even some

hedge funds in trouble. You also have the precarious housing market that who knows what will happen. I really believe it is being kept up by some unknown forces.

I am hanging in there for a while but really have to start thinking about it. Probably make a move sometime after the first of the year.

You also have China holding 1 trillion dollars in reserves which not sure how that can play out but it was mentioned on MSNBC by a New York Times Columnist the other day.

As you say a lot of things out there.

[Ready4Change]

5. My understanding is that it's the other markets.

DOWs one saving grace is it's mass. If it goes down, so does most everything else. So the other markets do what they need to keep it afloat.

[cyberpj]

6. Government Intervention in Stock Market is Detailed by New Report

Been holding onto this article for a while.....
======================================================
Government Intervention in Stock Market is Detailed by New Report, GATA Says
Tuesday September 6, 8:30 am ET


MANCHESTER, Conn.--(BUSINESS WIRE)--Sept. 6, 2005--A major Canadian financial management firm that a year ago published a compilation of evidence of central bank manipulation of the gold price has just done the same in regard to the U.S. stock market and has reached a similar conclusion.

The new report is titled "Move Over, Adam Smith: The Visible Hand of Uncle Sam," and has been published by Sprott Asset Management of Toronto. It was written by the firm's president, John P. Embry, and his assistant, Andrew Hepburn, and concludes that the U.S. government has intervened to support the stock market so many times that "what apparently started as a stopgap measure may have morphed into a serious moral hazard situation, with market manipulation an endemic feature of the U.S. stock market."

http://biz.yahoo.com/bw/050906/65371.html?.v=1

[lectrobyte]

11. Uh oh. This seems very bad, and very dangerous.

For some reason, I'm flashing on to one of those Roadrunner/Coyote cartoons. The one where the Coyote runs over a cliff and keeps running in mid air, and keeps going awhile, until he realizes there's nothing holding it up...

[cyberpj]

33. Seems like it depends on how long they can actually prop it.

If the foreigners we owe all call in their debts that bottomless pit you imagine could become a reality.

I've moved the bulk of my stiff to savings to wait it out a while, the rest I have in foreign stocks.

[fasttense]

9. The GATA report concludes that

The feds are buying up futures contracts to artificially support the market

From the report:

"Given the available information, we do not believe there can be any doubt that the U.S. government has intervened to support the stock market. Too much credible information exists to deny this."

This link gives a brief description of the GATA report and provides links to the report itself. It is interesting reading.

http://biz.yahoo.com/bw/050906/65371.html?.v=1

You folks are just too quick. I see two others have posted this information already. But what the hey, one more wont hurt.

[rkc3]

12. By Christmas, America will have had four or five months of

absorbing high energy prices - two or three of them will be winter months.

All the money that would have gone to Christmas spending will be spent already going to and from work and keeping the kids from freezing in their sleep - not not mention putting food on the table.

It might be time to reconsider your 401k holdings in advance of the holidays. General stock funds might not cut the cake - invest for wealth protection or in companies like Neiman Marcus (since the wealthy will still be buying each other expensive goodies) or ExxonMobil (they will be seeing record profits for years to come).

I can't afford to drive to work anymore, but at least gays can't have abortions. This compassionate conservatism really works.

[ClintonTyree]

19. Isn't December historically a bad month for the Market?

Or flat at best? That's what I've always heard anyway. :shrug:

[cyberpj]

32. October is the month usually associated with plunges. nt.

[Spazito]

16. Here is a good article on the PPT (plunge protection team)

http://www.upi.com/view.cfm?StoryID=20030320-045829-6404r

snip

How might this rigging be effected? The Standard refers to the so-called "plunge protection team," which it said "consists of the president, the secretary of the treasury, Federal Reserve Board Chairman Alan Greenspan, various other senior administration officials and the leading movers and shakers of Wall Street."

However, according to the remit of the Working Group on Financial Markets, the official name of the grouping, set up in March 1988, five months after the October 1987 stock market crash, its membership doesn't include private-sector officials. The group is chaired by the Treasury Secretary, now John Snow. The other members are Greenspan, the chairman of the Securities and Exchange Commission and the chairman of the Commodity Futures Trading Commission.

The group's initial remit, which does not appear to have been amended, was to examine "the major issues raised by the numerous studies on the events in the financial markets surrounding October 19, 1987."

The group was to "consult, as appropriate, with representatives of the various exchanges, clearinghouses, self-regulatory bodies, and with major market participants to determine private sector solutions wherever possible" and "report to the president initially within 60 days (and periodically thereafter) on its progress and, if appropriate, its views on any recommended legislative changes."

[ClintonTyree]

20. So there really IS a PPT!

Thanks, I didn't know if it was another myth or an actual entity.

[spinbaby]

17. The lady who manages our IRA said...

...that she expects the market to go up in the near future because corporations have record amounts of cash on hand and they need someplace to put it.

[ClintonTyree]

21. Could be.....

they're certainly not spending it on expansion (at least in this country) or equipment upgrades. There's nothing left to upgrade!

[Greyhound]

25. She is making the assumption that they will put it in the market. What if

they decided to park it in liquid assets so they have the cash on hand to buy the millions of looming foreclosures?

[NoAmericanTaliban]

28. IRA manager is payed to lie

It is in their interest for you to invest with them. Don't forget you writes the managers paycheck. The first assumption is that 'all' these companies have lots of cash on hand ( Delta & others may argue that one). If that is the case & the market has soooo much potential, why haven't they invested all that cash in the market already.

[TNDemo]

22. So when will the government not be able to prop it up anymore?

And what will happen then?

[Greyhound]

24. Because the people that really control the market are propping it up.

It is part of the scheme to get more, or should I say all, of the money that's left in irresponsible private hands, like yours. If the market reflected the real state of the economy you wouldn't put your retirement, medical account, health care account, or whatever scam they come up with to convince you to put your money in their pockets. Once this is done, there will be a "crash", and it will all just disappear like $7.5 trillion has so far.
You ever wonder why, if its your money, you have to put it into one of the approved accounts controlled by financial institutions (IRA, 401(k), etc.)?

[tom_paine]

27. Now the the Busheviks have eliminated accountability

The Plunge protection Team is the Save Our Asses Team.

And they have access to BILLIONS now not to mention the TRILLIONS they have already looted sitting in numbered accounts all over the world.

Imperial Amerika is a sewer of corruption.

[TahitiNut]

29. The DJI 30 are where investors first run from the S&500.

The DJIA is a trailing edge investment indicator. Investors lacking confidence in the broader-based economy, first shift to the 30 major industrial stocks. If you take a look at the DJIA, it's essentially flat for five years, going back to 2000.

If, on the other hand, you look at the S&P500 (which I regard as far more indicative of the equity market), you'll find it's quite a bit DOWN (more than 15%) from highs of over 1400 in 2000.

The equity markets are on the "life support" of 'forced' investments. Huge pension funds really have no place to go when the Fed keeps interest rates artifically low. The investment economy is being stretched like a rubber band and will eventually snap.

[bemildred]

34. Money is not real. It's magnetic bits somewhere.

That makes it a lot easier, we have "faith based" money,
so you can make as much as you like as long as people
continue to believe in it, and for the most part people
have no choice but to believe in it.

[Sparkman]

35. Gold is a contrarian investment, for when the economy hits the skids...

and look at gold now. 18 year high. DJI has been flat for 5 years of * administration. You have to go back to 1977 for a market performance this bad!

[Greyhound]

36. They are know as "market makers" in the vernacular. n/t

[PowerToThePeople]

37. Big Market makers holding it up until enough small timers get in.

n/t