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Quote Of The Day From Credit Suisse: "US Stock Market More Reliable Despite Crashes"
Just in case anyone wanted to know what not to say to defend the absolute horrific mess of self-aware vacuum tubes and errant algos, formerly known as "the market", here is a great primer from Credit Suisse's trading strategist Phil Mackintosh.
Bullets summarized by Bloomberg:
- U.S. Stock Market ‘More Reliable’ Despite Crashes
This one really needs no comment
- Computers “make it easier” to find outliers in terms of price, volume helping to make the markets “more reliable” now compared to the period before computerized trading
So forget about actual value, just look for millisecond momentum mean reversion patterns out of whack and trade on that. Wait, what about the market being a discounting mechanism? Um, nevermind. Also, what can possibly go wrong with simply trading momentum. Speaking of, has anyone head of JAT Capital lately?
- 10 worst days in Dow all happened before computerized trading
So there were no computers involved in the "dynamic" hedging involved in Portfolio Insurance and the debacle which became Black Monday? But yes, it was mostly human traders dealing with the epic disaster in the aftermath of computerized Garbage In, Garbage Out models (kinda like those used by every polling Wunderkind nowadays). One can only imagine what would happen if momentum accelerating algos had been involved in 1987...
- More stocks gapped 1% in 1 minute in the early 2000’s than now, improved as computer use grew
A fine example of spurious correlation, because one can refute that infinitely more stocks gapped from their NBBO to $0 or infinity after 2000, and especially after the adoption of Reg NMS and ATS, both of which completely broke the market.
- Concluded reaction to trades “much faster than a typical asset manager would most likely be able to move” suggesting“ short term traders do provide value” by adding significant liquidity, transferring risks.
Go ahead and tell that to BATS and its catastrophic IPO... And no, fast trade reaction simply means that mean reversion algos kick in without regard for the actual underlying news. Also the only transfer of risk that takes place is that from collocated boxes to the slower retail platforms which are always left holding the stick. Because so much happens in the 10 nanoseconds after a headline sends a stock to $0 and back. Also, the only value short-term traders provide is churn and chaos in the immediate aftermath of big news. Because otherwise what is the rationale to halt a stock when it is up or down 10%.
Finally:
- Notes daily value of U.S. stocks traded of $220b more than double rest of world combined, shows “vote of confidence”
Look up Stockholm Syndrome Phil. Then look up how much money exchanges make from High Frequency Churning, pardon Trading. Finally look up any of the thousand examples caught on Zero Hedge showing quote stuffing, subpennying, flash crashing, internalizing, dark pooling, and last but not least, how HFT has never, repeat never, added to market liquidity (as predicted by us one year ahead of the Flash Crash), when said liquidity can be literally pulled with the pull of power switch out of a socket: the proverbial HFT STOP.
So no, Phil, "despite crashes" the stock market is not "more reliable." Quite the opposite. But please issue more sad, yet entertaining, defense pieces such as this one. All it shows is the desperation with which you and your peers are approaching the wholesale disgust that most people who manage money are now exhibiting toward the complete fraud that the stock market has become. That's ok, though. The upside is one day you, too, will learn a socially beneficial skill, as opposed to finding sub-nanosecond arbitrage opportunities in a market which is only where it is thanks to $14 trillion in monetary injections (and rising at an exponential rate) from the central planners.

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Or is it "will crash reliably"?
"The upside is one day you, too, will learn a socially beneficial skill, as opposed to finding sub-nanosecond arbitrage opportunities in a market..."
Bit jealous?
Reliable losses!
Careful: Nature abhors a vacuum tube.
It's still people running those computers...
& as if it needs saying. There's no way we'd be 1400+ without QE opTwist
& the best response I can think of? Bots have crashed stocks 100% nearly infinitely faster than any humans.
HFT... adding volume and liquidty, and enough chop to slaughter muppets, since early 2000s.
Out of curiosity, are there any other sites similar to bloomberg or reuters markets? but absent of the msm bs? Something akin to zh?
Gladly I currently do not have the time to go through them, but I've found many interesting articles outlined in the sidebar on the left ("Zero Hedge Reads")... Obvious answer, but I doubt one in 1000 can check them on a regular basis and you might find a good 'second'.
p.s. Do you ask because you too find your self refreshing ZH, W A I T I N G for a new article!!? =D
Right, remove all the trillions pumped in so far and halt Twist and QE'z and lets see how rosy things look. These people are whores.
That makes me feel better. I'm going to rush out and sell my gold to buy stawks right now.
Do you think this guy's bright enough to understand he's a tool?
Brightest tool in the scrap pile.
I recommend re-education camps for the idiot insiders who still don't get it.
Totally false..........
(staring at screen wondering just what to say.... mentally drumming fingers... waiting... waiting... waiting... what's for lunch? wondering if anybody really cares anymore? remembering NYT opinion piece...)
http://www.nytimes.com/2012/10/30/opinion/a-big-storm-requires-big-gover...
There is "no excuse for inaction," Obama said after a brief unscheduled visit to Red Cross headquarters in Washington. "I want you to cut through red tape; I want you to cut through the bureaucracy. There is no excuse for inaction at this point."
Which means there are excuses for inaction, bureaucracy, and red tape at other points. Useless rules by a useless government Dem and Repub.
We have a rule, no foreign flag tankers in the harbors. Oh wait, we can have foreign flagged tankers now. The crap is all made up with no real reason behind it other than to exercise control.
Sure glad he said that to the Red Cross as opposed to his very own charges at FEMA....
"The crap is all made up with no real reason behind it other than to exercise control."
One more big reason- SHAKEDOWN!
Gotta provide an incentive to get "campaign contributions" flowing!
However seems the "Useless Bureaucracy" was OK when whichever Government "of the People's Choice" (Ha, Ha!) created it though . . . .
Another "Jobs for the Boys" situation - or, - "you taxpayer's dollars hard at work". Doing what, no-one seems to really know . . . . .
well done Tyler
The last passage is Head Shot!
This ass now moves to 5th in line behind Bernanke, H. Paulson, Geithner, and Dimon for high treason prosecution.
wow, so ahead of Corzine, Blankfein, Summers, Rubin, Mozzila, Gensler and most of the SEC and CNBC staff?
Ah...no. You are correct. Just a temporal bias.
"Come the Revolution", you're going to need a VERY long wall, or perhaps many shorter walls (so all the "Good and the Great" from previous Administrations have the honour of being first up against "their" bit of wall!)
Every town has at least dozens of light poles.
The US is more solvent and creditworthy with all of our debt than when we had a balanced budget.
Tyler, any word on what bix weir wrote here?
DTCC Fraud Cover-up In Progress!
http://www.roadtoroota.com/public/1035.cfm?awt_l=E7XnQ&awt_m=3XK5K0EX_xA...
TYIA
http://www.opensecrets.org/orgs/summary.php?id=D000050099&cycle=2012
Nothing to see here, especially when your lobbying arm has a bunch of ex-CONgress Members/Insiders.
We are all on the outside looking in and nothing will change that.
Well, let's see... one would have to be monumentally stupid to store important papers in a non-watertight, underground vault. Especially papers that are claims on wealth. Claims that it is your entire job to protect, and administer.
Nope, nothing to see here...
As I said last week, Jim Sinclair and friends are the only people in the world safe from the dangers of rehypothetication.
"U.S. Stock Market ‘More Reliable’ Despite Crashes"
May take this was designed to blow fuses on headline scanners.
I had a Chevette that was more reliable than this market..
A bud had a Yugo he swore by as well.
And he hated stocks.
My buddy had one too. But, he shortened it to "Vette" when the ladies were around.
It got him laid, but he offered no rides home. He always said he could get laid for
$20, we found out that was GF's cab fair home.
That guy is hilarious. Not that they are doing anything to stop HFT but maybe the SEC should then encourage more algo-caused crashes/cracks so that the remaining 'market' participiants learn to deal with 10 percent movements within nanoseconds. From Taleb's "Black Swan of Cairo" I learned that the deciders should not try to suppress volatility. So a major crash every fortnight might help to restore confidence.
btw: As a guitar player I don't like it when one compares HFT with tubes.
Nothing quite like the Marshall "valve-sound" is there!
The image looks very much like an ECC88 too.
More reliable? LOL.
I guess it depends on what metrics you use?
It certainly is not a market for buyers and sellers to determine the value of a company, and a place where you may "invest" your saved capital into a business looking for dividends on said capital.
Now if they mean a better place to show proof that your MMT works, then yes I would agree that injections of liquidity and everyone and their brother rent seeking on their every depreciating saved or borrowed credit money before the music stops are giving sheep a false sense of survival for the moment.
I guess it all depends on what you definition of "market" is?
pods
Well, for one thing, dead people are fairly reliable.
Maybe that's what this CS flunkee is talking about? Perhaps Phil is getting all philosophical in absence of markets to analyze?
Reliability despite crashes, like having your g-spot hit despite being raped.
ROFLMAO!
Keep trying; three generations have lost trust in the markets and the entire system.
TPTB are going to need a lot of SOMA to restore any semblance of trust in the casino.
Trust? No, no, no.
The words you're looking for are "captured funds," a.k.a. "your 401."
GIVE US ALL YER MONEEEEZ!!
U.S. stock market more reliable because of computerized trading... Now you can see yourself, in the comfort of your home office, taking it up the ass , " Real Time"... (l)ô > Ben Dover.
The circuit breakers halt trading now so of course you can't crash but you can't trade during that time either.
This is just the type of over-the-top bullshit spewed right before the wheels fall off.
Add to that Dalio's treatise on self-sufficiency that doesn't even mention resources or balance of trade. I'm still speechless that this passes as intelligent analysis in some circles.
It goes to show how upside-down our system is. How can this idiot spew forth such bullshit and go associate with his clients and smile. Beyond words. What a jack ass.
I would assume that these type of technical sophists are segregated from the rank and file sales force in an effort to ensure their delusions are not breached by any of the commoners.
Well, that or they hit the bottle first thing upon waking.
Either way the bubble d.b.a "The Facade of Integrity" must be protected at all costs!
Double post. Sorry
This would have been a great day to close the market for lack of interest. What a waste of electricity today on Wall Street.
Agreed, computers create "wealth" until we are unable to read out this "wealth" from the hard drives because of power loss.
This was an Onion article, right?
I remember a wise old man who always told me... A heart attack that doesn't kill you makes you stronger.
I miss that old guy.
www.tradewithdave.com
A fluff piece to convince the simple minded oatmeal brains out there that the new "markets" are superior to the old markets that allowed human beings to participate.
"socially beneficial skill" Hmmm, let me think, http://www.cmarshallfab.com/wp-content/uploads/2011/02/guillotine191.jpg
Wonder what's in the box.
Whenever they start that 'liquidity' shit you know the BS is flowing. "Market making' is another fraud flag.
Article title sounds like a oxy moron! thats why I stick to trading stocks from these guys who deliver great picks http://www.pennydreamers.com
Way to give it to them MY MAIN MAN!!...We ain't all ameteurs!!
chalk another up for MY MAIN MAN...got my back
I just called Waddel and Reed and they said, "Fuck you Phil!"
The banksters are getting really desperate again. They have ramped every levered financial instrument to infinity, and can't find any suckers so they can bolt out the exit door! F..king scum, all of them.
I can't wait to see all the banksters faces when they are stuck holding their bags of recycled ass wipes, when everything vaporizes.
Desperate? Hardly. They've only got to keep the ruse up for one more day.
Then?
Que the Mayans!
It's, however, important to spread such absurdities among people gradually eroding the trust in the institutions until the point of no return is inconspicuously reached. The lunatic bankers and politicians fully trapped in greed and superiority will not notice the point coming, and if even so they'll be clueless as to what to do because the solution is far beyond the realm of their understanding and willingness to act appropriately. Simply put, in the end they'll screw it up to an irreversible extent, perhaps even with the best intentions in mind.
I am standing in defence of the Vacuum Tubes (VT)!
Please stop abusing the VT images, and put the real abusers, the Transistor (T).
For one, it is certain, VT are a lot more enduring and interesting devices then the T, and not to mention at all the reliability issues.
And not last, VT are analogue devices, especially compared with the T.
You know there are difference, so please be precise. I know, T do not have a cool image as the VT, but hey we do not want to distort the truth, do we?
I greened you up for the defense of our beloved 12AX7s and other melodical audio tubes.
That said, the transistor isn't evil either, it's the CPU multiprocessors that do the dirty work.
But we need them to read ZH, so what's a mother to do? We can't throw the baby out with the bankwankers.
And there's that special class of vacuum tubes without which Nuclear War would be so much more difficult - many of which seemed to find their way (illegally) to a certain Israel, "to help with their Defence Programmes"
http://original.antiwar.com/smith-grant/2012/03/21/israels-nuclear-triggers/
http://archive.feedblitz.com/192570/~4223662
http://www.irmep.org/ila/krytons/
Maybe I'm just being contrarian, but I get it. I agree the market is totally "more reliable" these days.
If the purpose of the stock market has traditionally been to help the wealthy con the less wealthy out of their money, I'd say the takeover with computers has helped tremendously.
Surely, we can say that it was an impact of having an election for the US president. According to Micheal Lombardi's personal notes published at http://www.profitconfidential.... , it was sure that there would be an impact as we seen in the interview and session between Obama and Rooney.
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