Wednesday, May 26, 2010

Down, then Up; Up, then Down; Market is a Total Scam

Anybody who hasn't kept up with my daily diatribe ought to read yesterday's post, or any of the last three hundred or so, many of which described how completely rigged and corrupted US equity trading markets have become.

Today was no different than any of the usual scam trading days which favor the Wall Street professionals over the average investor, who, naturally, holds no chance of success in such a manipulated and under-regulated environment.

Stocks gapped up at the open, just like they gapped lower at the open yesterday, freezing out everybody but insiders and forcing up bids. By 10:45, the Dow and other indices had generally reached their peaks, with the Dow up 135 points, but from there it was Chinese water torture in a slow, steady decline which finally put stocks in the red about fifteen minutes after three o'clock, eventually closing at the lows of the day.

Closing for the first time under the magic 10,000 mark since February 8, the major indices are in treacherous territory, which, again, I've been spouting off about for the past three weeks. Our nascent recovery isn't going all that well, despite some very strong numbers released today on new home sales and a steady report on durable goods.

The April new homes sales data were skewed by the April 30 deadline for the federal $8000 tax credit for new home buyers. Many buyers rushed in to take advantage, just as they did last year when the first stimulus credit expired in November. May figures, therefore, are almost certain to be disappointing, so today's release was severely discounted.

Durable goods are still at a run rate well below those of anything resembling a robust economy, so comparisons to last year are just whistling in the wind. If they were not improved, that would be a story. As it is, the manufacturing sector is mainly holding its own and not expanding.

Dow 9,974.45, -69.30 (0.69%)
NASDAQ 2,195.88, -15.07 (0.68%)
S&P 500 1,067.95, -6.08 (0.57%)
NYSE Composite 6,631.36, -34.47 (0.52%)

Surprisingly, advancers beat decliners by a healthy margin, 3827-2713, so some truly organized selling of specific issues has been undertaken by the insider syndicate currently in control of the world's money. New lows maintained their edge over new highs, 109-96, with elevated volume once again.

NYSE Volume 7,941,076,500
NASDAQ Volume 3,047,107,250

Oil popped back to life, just in time to keep fuel prices high over the upcoming Memorial Day weekend in America. July crude surged $2.76, to $71.51. Gold gained $15.50, to $1,213.30, while silver pushed 53 cents higher, to $18.29.

Investors need not bother watching markets for the remainder of the week as it's a good bet that they'll maintain a somewhat neutral stance heading into a long weekend. On the other hand, as well-oiled as is the machinery of manipulation, anything could happen, but chances of a global meltdown just prior to the kick-off of summer is a long shot. Chances of some major event that would roil markets when they re-open on Tuesday, however, is a strong possibility.

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