More on Stock Market Manipulation

The Federal Reserve is under a political directive to elevate asset prices. Never forget that. So far, my forecast for the fall stock market is right on target. The only reason I can do this is that it is all complete manipulation. Suppose you were one of the elite who dictate policy to the U.S. government. What would you have the government do with respect to the stock market? The the degree it is possible, you would create an unending uptrend in asset prices that would be your cash cow as long as it was possible to keep it going. This is not rocket science. It is only an understanding of human nature and how the animals act upon the incentives in front of them.

Previous Articles

https://quillian.net/blog/the-fall-stock-market-crash/

https://quillian.net/blog/the-fed-unwinding/

So what is next? The deep state knows you better than you know them. Technical Analysis dogma survives even though it is a trap. One glaring bearish market indicator it that of breadth which I show as the percentage of stocks above their 200 day moving averages. The chart shows that while the market has been making new all time highs, the averages are being carried by a serious minority of stocks. The deep state folks understand that concept. If the breadth indexes can be turned positive, that will bolster confidence even higher and suck more money into equities. The focus on the part of the manipulators will be to change the breadth cosmetics while allowing the Fangs and other hot stocks to take a well deserved rest. Hope is that with improving breadth numbers, the fangs will experience a shallow correction and be brought back into the picture a little further down the road. Also, watch for serious short squeezes in stocks where short sellers may have accumulated profits.

In a market like this, the most dangerous time to short a stock is after it has completed an important technical pattern like a head and shoulders top. This is squeeze city and a gift. Talk of low volume is pervasive but volume is much lower than what is suggested. When the in for the day only and split second trades are subtracted, there is almost no volume at all. As long as there are no long term holdings being sold off, moving the market higher is a piece of cake.

So, for the foreseeable future look for breadth to miraculously strengthen as the middle of October approaches. Any time there are bearish articles by major research firms, shorts are being drawn in for a new round of squeezing. Other bearish articles are there for the same reason. The days of agenda free news are over. Watch the NFL stories start to fade. When news hurts the deep state it disappears. As the fall season all pattern turns from bearish to bullish expect the most wonderful news to be announced. The economy is rotting from the bottom up. If some kind of economic crisis emerges, central banks including our Fed will announce that they are buying up excess supply of stock “to save the world.”

Many understand that the market is being manipulated. Only a minuscule few understand that manipulation is all there is.

 

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About Fantasy Free Economics

James Quillian independent scholar,free market economist,and teacher of natural law. Who is James Quillian? Certainly I am nobody special, Just a tireless academic and deep thinker. Besides that, I have broken the code with respect to economics and political science. Credentials? Nothing you would be impressed with. I am not a household name. It is hard to become famous writing that virtually no one in the country is genuinely not in touch with reality. But, if I did not do that, there would be no point in my broking the broken the code. If you read the blog, it is easy to see that there are just a few charts, no math and no quantitative analysis. That is not by accident. Given what I know, those items are completely useless. I do turn out to be highly adept at applying natural law. Natural law has predominance over any principles the social science comes up. By virtue of understanding natural law, I can debunk, in just a few sentences , any theory that calls for intervention by a government. My taking the time to understand the ins and outs of Keynes General Theory is about like expecting a chemistry student to completely grasp all that the alchemists of the middle ages thought they understood in efforts to turn base metals into goal. Keynesian theory clearly calls for complete objectivity. Government can only make political decisions. Keynesian techniques call for economic decisions. So, why go any further with that? Fantasy Free Economics is in a sense a lot like technical analysis. Technical analysis began with the premise that it was impossible to gain enough information studying fundamentals to gain a trading advantage. Study the behavior of investors instead. Unlike technical analysis, I don't use technical charts. What I understand are the incentives of different people and entities active in the economics arena. For example, there is no such thing as an incentive to serve with life in the aggregate. In the aggregate, only self interest applies. It is routinely assumed otherwise. That is highly unappealing. But, I am sorry. That is the way it is. I can accept that because I am genuinely in touch with reality. Step one in using Fantasy Free Economics is for me to understand just how little I really know. A highly credentialed economist may know 100 times what I do based on the standard dogma. Compare the knowledge each of us has compared to all there is to know and we both look like we know nothing at all. There is always more than we don't know than what we do know. I am humble enough to present myself on that basis. Why? That is the way it is. I am not bad at math. I have taught math. What I understand is when to use it and when to rely on something else. Math is useless in natural law so I don't use it. While others look at numbers, I am busy understanding the forces in nature that makes their numbers what they are. That gives me a clear advantage.
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