An evening post for you.
Mr. Toad's Wild Ride. How else to describe this crazy day in the stock markets?
At one point the DOW had fallen 1,000 points - a drop more precipitous than any day in 2008. By the close that market had recovered - somewhat - and closed down only 430 points.
Perhaps the most stunning development of the day occurred on the NASDAQ. From Bloomberg:
"Nasdaq OMX Group Inc. said it will cancel all trades of stocks at prices that were 60 percent above or below the last price at 2:40 p.m. or immediately prior. The exchange operator said in a statement it will cancel all trades greater than or less than 60 percent away from the consolidated last print in that security at 14:40:00 or immediately prior. Nasdaq said it coordinated the decision with all other exchanges."
Cancel all trades? Ummm... so the market was crashing big time at the end of the day and the Exchange intervened to say... "never mind, your trades which pummelled stock prices at the end of the day are... cancelled????"
Will tomorrow be Black Friday, 2010?
As I have said all year, the magical rally of the past year is a false recovery.
The bounce off the February lows has resembled a low volume Ponzi scheme. It has been driven by technically oriented buying from the Banks and the hedge funds.
Stunningly the anchors on financial television are trying to blame the sell off on a 'fat finger' order that caused Procter and Gamble to drop 20 points in 45 seconds. Are we to believe a typist inputting an order to sell 16 million shares typed "B" for Billion instead of "M" for Million?
"Oops. Crashed the free world. Sorry about that - my bad."
The market plummetted because of its highly unstable and artificial technical underpinnings. Wall Street right now is nothing more than a casino, dominated by a few big Banks and hedge funds.
I invite you to watch this 7 minute interview with Gerald Celente which echos a lot of what has been said here all year:
Meanwhile we now learn that the US Federal Reserve is printing up another $105 billion to send to Greece to help with its debt problem.
Is it being done to bail out more US Banks?
You know, the ones we were told had little exposure to sour European debt? Last week Bloomberg reported that JPMorgan Chase & Co., the second- biggest U.S. bank by assets, has a larger exposure than any of its peers to Portugal, Italy, Ireland, Greece and Spain. JPMorgan’s exposure to the five so-called PIIGS countries is $36.3 billion, equating to 28% of the firm’s Tier-1 capital, a measure of financial strength, Meanwhile Morgan Stanley holds $32.4 billion of debt in the region, which equates to 69% of its Tier 1 capital.
Make no mistake. Bernanke isn't supplying Greece with $105 billion in bailout money to save Greece. He's actually bailing out U.S. Banks—again!
Quantitative Easing is plowing ahead full bore. And we are going to reach a point where nothing will be able to stop this money from eventually entering the money supply.
And when it does, inflation is going to hit with a vengence.
1981 is going to look like a cakewalk of cheap interest rates when all this finally plays out.
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