Watch the Russell 2000

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This is a repost to illustrate the point that a strong Russell 2000 telegraphs enormous organized support for stock prices. Notice that while the Dow is under pressure the Russell 2000 is in the green. The weight on the market is enormous. Organized support is enormous also.

In my last stock market manipulation post, I pointed out the importance of the Russell 2000, in telegraphing efforts of organized support when the market is under pressure.

Notice that when markets all over the world are down around one percent, the Russell 2000 is in the green as of mid day. There is much more pressure on the market than what than what the averages indicate. When organize support is in the crash prevention mode, everything gets some central bank buying. On days like today, only the Russell 2000 and a few of the central bank favorites are strong.

Supporting the Russell 2000 is like trying to blow just enough wind on a feather to get it to  move only one inch. The Russel 2000 is so thin, it is hard to support it just enough and they always overshoot their target.

There is lots of supply starting to hit the market and it will only increase. What we still don’t know is what heroic measures will be taken, to protect the assets of the world’s richest citizens. The selling won’t end. It will come down to how much central banks will buy? Will their political directive be withdrawn? Will ordinary citizens figure out they are being fleeced and rebel? Either the central banks will end up controlling the worlds factors of production in terms of capitalization or stocks will go down a lot. Regardless, the efforts to save asset values are still enormous and relentless.The Swamp My Puppy Dog and I is another timely Curbside Jimmy song.

About Fantasy Free Economics

James Quillian is an independent scholar and economist.
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