EVER HEARD OF THE STOCK EXCHANGE SPECIALIST?
Are you under the illusion that the New York Stock exchange, whose antics we've all been watching so closely the past couple of weeks, is a free and open auction market? Then, according to this article, think again, and the article speaks for itself, so I will try to limit my commentary due to its length:
How the New York Stock Exchange Really Works
This article, though based on now outdated data, nonetheless points out the manipulated nature of the NYSE. What is far more important, however, in my opinion, is the interlocked nature of the NYSE, the Federal Reserve, the Securities and Exchange Commission, and the revolving door between all of these.
Note that the victim here is the middle class investor, i.e., the small investor with a little extra cash to invest, for depending on the specialist and his marching orders, that investor can either be enriched, or robbed.
I mention all of this because, as our country now begins a political debate over the economy, the role of the Federal Reserve, the national debt, it is important to realize that another component of our economy needs to be brought into the public debate: Do we really want a small cadre of specialists making such decisions for the country? Does the NYSE need reform, or is the current arrangement satisfactory? Do we need another government bureaucracy when the current one - the SEC - already is so closely connected to the government? Does the revolving door between private business and government agencies really serve the best interests of the people? If not, what can we do to reform the system?
Obviously, not everything with the current system is bad, but there is much broken in our country, as everyone knows, and while our attention is focused on the Fed and its abuses, we need also to remember that there are other institutions that need scrutiny.
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“not everything with the current system is bad”-
right- and I shot Kennedy with a pop-gun from Mt. Rushmore
Here’s something that may go hand in hand with what we’re seeing now.
Slumping Stock Market: Why Investors Feel Like It’s Not As Good As Gold
I trade my own accounts, not leaving it to some broker. This does require me to actually research, make decisions and (not too often) take the blame if something goes wrong. Overall I do better than the “market avg”. But, try as I may, I can’t convince the people I talk to to take more responsibility for their own finances and retirement. They “trust their broker”, who tucks them into mutual funds they don’t know the composition of, get roped into auction rate securities (rather than a money market acct) then find out how illiquid one can suddenly get, etc.
They love my results, but when faced with the task of doing that themselves, they go all queasy, usually claiming it’s too complicated. Yet when the market goes down (because they have no hedges against that) their broker won’t give them a guarantee, refund or even a simple “sorry”. They will take bad results simply because they have such illiteracy and therefore poor confront of the entire subject of finance. But then going back to the same terminal that gives you bad results, while hoping for good results this time, is just nuts. As Forest Gump said “Stupid is as stupid does.”
Read Ellen Brown’s Web of Debt.
& Babylon’s Banksters, the best books on the subject
Check out: The Max Keiser Report (google it)
It comes out Tuesdays & Thursday on Rt.com
It is also archived.
The greed goes on while the American people snooze and watch sports and reality trash. The Fed gives the bank money and they put it into the stock market when it needs to be proped up, then take profits out of it before it drops again. You’re right on Dr. Farrell, the ole middle class takes a hit. We’ll all wake up broke without a country some day as one our founding fathers once stated…. if we don’t stay vigilant. But, we can continue to bomb everybody on the planet without comment from the so called liberals opening their mouths. So be it.