The Crash That Wasn't: Thursday's Rally Explained

At the Close, Thursday, October 15, 2020:
Dow: 28,494.20, -19.80 (-0.07%)
NASDAQ: 11,713.87, -54.86 (-0.47%)
S&P 500: 3,483.34, -5.33 (-0.15%)
NYSE: 13,137.25, -5.92 (-0.05%)

This morning, the normal "at the close" piece attached to every Money Daily post has been moved to the top of the page instead of its normal position at the bottom to illustrate, clearly, what happened on Thursday, when futures suggested a major selloff in the cash market.

Let's take a look at the lows of the day:

At the LOWS, Thursday, October 15, 2020:
Dow: 28,181.54, -332.46
NASDAQ: 11,559.10, -209.63
S&P 500: 3,440.89, -47.48
NYSE: 12,960.98, -182.18

Yes, the major indices were down roughly 1 1/2 percent at the lows. What happened?

First, understand that those lows were made - on each market, in unison - within minutes of the opening bell. Conversely, on the other side of the daily chart, the highs of the day were reached roughly 10-15 minutes before the close. In other words, "you got played."

Not that this is an isolated incident. As a matter of fact, erasure of losses happens all the time on US stock exchanges, and has been occurring repeatedly since then-President Reagan signed executive order 12631, on March 18, 1988, establishing the Working Group on Financial Markets, commonly referred to as the Plunge Protection Team, or PPT.

The PPT was established in the aftermath of the 1987 crash, a one-day global sell-off that happened on October 19. That date is referenced around Wall Street as "Black Monday." The Dow Jones Industrial Average lost nearly 22% on that day; the S&P was also down more than 20%.

For many years, mere mention of the "Working Group" or PPT would elicit jeers and laughter as its existence was considered high humor and conspiracy theory. It wasn't until February 23, 1997, when a Washington Post staff writer, Brett D Fromson, coined the term "Plunge Protection Team" as the headline of an article in the Washington Post detailing how the "Working Group" was designed to function.

New York Post financial writer John Crudele, former congressman Ron Paul, among others, have used the term openly and frequently since then. It's now common knowledge that the PPT exists and that it prevents market crashes by buying futures contracts.

Apparently, the PPT sprang into action right at the opening bell Thursday, as markets were crashing, not because negotiations on a stimulus bill were stalled out or that coronavirus cases have been rising. Those stories have been used as scapegoats for every market slip since July. Thursday's crash was set off by the New York Post story detailing some of the contents of one of Hunter Biden's - son of presidential candidate, Joe Biden - computers, and the swift censorship of same by Twitter and Facebook.

If the wheels were coming off the great "blue wave" Democrat sweep narrative because it's figurehead, Biden, was being exposed as a crook, liar, bribe-taking dirty dealer, then the Deep State's dream of a new world order might be coming to a quick and premature end.

Once the market opened and the social media giants made it clear that the story would not be allowed to circulate through their platforms, the PPT had its marching orders or really, really smart money started buying and kept buying all day as it became clear that Facebook, Twitter and the mainstream media would not make mention of the article or any of the subsequent articles from the Post (which had its twitter account locked) or mentions of it by President Trump's campaign team (ditto) or anybody else.

So, there you have it. Americans are being played, not just by the media or lying politicians, but Wall Street hucksters who make their plays in the futures market and move money in the cash market. It's like an elaborate game of three-card monte in which the brokerages owned by the biggest banks are the dealers and the general public are the marks. The scheme relies upon computer algorithms that respond to headlines promulgated by their allies in the mainstream media. Some of it works automatically, to make markets and individual stocks go in whichever direction they please, despite fundamentals, earnings, p/e ratios and tools like that which used to help determine stock prices and real value.

No more. Those days are over. Today's stock markets are controlled by unseen forces beyond the ken of most wizened traders or analysts. It's a new ball game. The PPT is part of it. The meida is another cog in the wheel, and in the end, nothing happens without the whirring sounds of computer fans at server farms in New York and New Jersey pushing HFTs (High Frequency Trading) through the system formerly know as "markets."

These aren't markets any more. They haven’t been markets in any traditional sense for a long time, at least since the GFC of ’08-09 and likely earlier. These are control mechanisms, deep state constructs designed to influence public behavior, stifle awareness and shunt free thought. Think you can beat the market? Do you have trillions of dollars available at a moment's notice from the central bank? They do, and you can't possibly win unless you play their game.

The alternative is to not play at all, a position that’s becoming increasingly popular as institutions become monolithic oligarchies and individual freedoms are beaten to the curb.

It’s not for everybody, but it’s at least an option.