This page has been archived and commenting is disabled.
All Hail Our New Lord & Master - The Stock Market
Submitted by Charles Hugh-Smith of OfTwoMinds blog,
We're all minions now of the stock market.
The all-powerful Federal Reserve is mere minion of the stock market, a kitten absurdly claiming in public to be a tiger. If the market threatens to drop, the Fed quickly prostrates itself and does the bidding of its Lord and Master: "No rate hikes, minons!"
By cowering in terror of a stock market tantrum, the Fed has surrendered everything: its vaunted (and completely phony) independence; its duty (yes, go ahead and laugh) to the nation and the real economy--everything.
The Fed is nothing but an abject slave of the market. It masks its servitude with Newspeak, but the reality it has only two choices: burn the market down with a series of rate hikes or surrender completely to the market, relinquishing any pretense of power or control.
The Fed is not alone; the entire financial-political system is now beholden to the stock market.
Want to impose real restrictions on the financial sector? Forget it, Congress--the market will rebel. And if the market sags--you'll cave in like all the market's servile minions because a significant chunk of your campaign contributions come from those profiteering off the market.
Corporate America--don't dare miss your quarterly earnings number or you will suffer the wrath of a market that destroys all who don't obey its demands for short-term profits at the expense of long-term profitability. Were the management of a public company bold enough to sacrifice short-term profits for long-term growth, they wouldn't survive the market's destruction of their stock price.
The stock market now dictates fiscal and monetary policy within the Empire because the American economy has been fully financialized. Profits flow not from innovation in products and services but from the financialization of every income stream.
While definitions of financialization vary, mine is:
Financialization is the mass commodification of debt and debt-based financial instruments collaterized by previously low-risk assets, a pyramiding of risk and speculative gains that is only possible in a massive expansion of low-cost credit and leverage.
Another way to describe the same dynamics is: financialization results when leverage and information asymmetry replace innovation and productive investment as the source of wealth creation.
When the profits from financializing collateral and leveraging those bets to the hilt far exceed generating wealth by creating products and services, the economy is soon hollowed out as the perverse incentives of financialization start driving every business and political decision and strategy.
Even Darth Vader now takes orders from the stock market:
We're all minions now of the stock market. All hail our Lord and Master, the stock market.
»
- 10307 reads
- Printer-friendly version
- Send to friend
- advertisements -
fuck you bernanke
That would be like saying it's a slave to itself...
Stock Market is the new Las Vegas. It is no longer a place for people to invest for their futures. Thanks Federal Reserve/SEC. Time for some entrepreueur to find an alternative?
Stock market is the new Illinois lottery.
or the Chinese rare metals exchange
But, see, the Fed has a dual mandate, and both measures are in great shape, unemployment and very moderate inflation! The Fed is a living breathing Jedi Mind Trick. The Farce will be with us, always.
Foreign investment to US Stock market is US tax free. FRB is majority foreign owned, do the math.
hence bill dudley is the president
William Dudley, NY Fed head, and his direct line to Goldman Sachs.
How sweet it is for Goldman Sachs.
The stock market is too big to fail.
"because a significant chunk of your campaign contributions come from those profiteering off the market."
Don't forget that many or perhaps most in congress have millions and millions of dollars in investments and are making decisions about their own net worth.
good luck with that shit, you're out of your 2 minds
It's not the stock market... it's big money that controls everything.
Paul Eberhart is glad we have a lord and savior because he was confused. pauleberhart.com
The Fed and the market oligarchy are in bed TOGETHER. One hand is washing the other and it's all a lie.
The oligarchy owns the fed. The only reason the fed exists is to transfer wealth upward.
Doctor, the correct technical term would be inofficial oligarchy
then the term oligarchy comes from Greece, where citizens, exasperated, roughly said:
"you know what? you do the politics, you do the decisions, but you pay the taxes and you bleed"
there were different permutation of that, up to the quite common five tax and military classes as ancient Athens adopted (see Constitution of Solon),
but the official oligarchic models all contained one tenet:
a different tax load and military service load according to wealth. more wealth = more military service and more taxes
without saying, weasel oligarchs prefer the inofficial oligarchic method
Wrong.
Mr. Market is slave to the Fed, like everyone else.
Wonder why one would obscure that fact by reversing it..
Wake up. Big banks and big industry are in bed together and sit on each others boards just as the banks and educational institutions are in bed together. The higher the tuitions, the bigger the loans....get it now?
Wow Charles, one would have thought you could have figured this out when Paulson threatened the nation with tanks in the street if we didn't hand over $750 bill. Try to keep up will ya?
A number which Paulson admittedly pulled from his ass, trying to find a palatable amount to extract from US taxpayers
he pulled it out of his ass where he also found his mobile phone, which now is proudly exposed in the Smithonian Institute as "the cellphone that saved America"
And I thought that was a joke. Sadly:
http://americanhistory.si.edu/collections/search/object/nmah_1344567
"The market, nay the world, is controlled by the [....].
Only a matter of time before some yobo starts bleating about that.
Despicable NYSE.
Seems like the 'New Normal' actually began about two decades ago and Edward Bernays theories about the lemmings and behavioral control were right on. The stock market is now everything, and they cannot let it fail. It no longer reflects future “earnings”, it drives the entire economy in some perverse never intended, fashion.
The oligarchs were made wealthy beyond their wildest dreams, and 95 million people are now all in, and will NOT tolerate losses. They vote and they borrow money and buy lots of crap from China. If they get scared, it all falls apart and the cities burn. The lower 1/3 have all the handouts they could ever want, all funded by massive and growing debts. The next president will be the one who vows to maintain the status quo.
No going back now, $20T in debt will happen fast, and another war is guaranteed to feed the MIC. Get used to it folks…bears will NEVER be allowed in again.
From now on you'll refer the stock "market" as "The Casino."
from a strictly usa centric viewpoint pumping up bullshit stocks on hedge hog margin, foreign central bank and pension buying, and levered corporate buybacks isn't really destructive, FOR NOW. However, even if the hedge hog margin is never unwound corporations will hit their borrowing limits and pension funds will switch from buy to sell. when that day comes there will be a steady erosion of all financialized instruments and that will necessitate fed buying MOAR and THAT pisses me off. they said no-one could see the stock and housing bubble but that's a lie. now it is way worse BITCHEZ.
The $40 drop in Gold for absolutely no valid reason. Yellen should have that bazooka shoved up her twat. They are going to get theirs soon. I will not have one ounce of sympathy.
Look at money velocity. Soon the Federal Reserve's plan to impoverish the 99% and enrich the 1% further.
QE4, bigger and bolder next year.
I just enjoy watching hedge funds get hammered. NOW they see that they really might have to perform real research instead of just front running the fed and the other central banks.
Janet...you have fallen from the graces of the Chairwoman of the FED to being a slave...(a person entirely under the domination of some influence or person:
Sounds like a reflection period is needed to reorient yourself to your responsibilities.Because the Irving Fisher.
Because the deflationary spiral.
Because the consumer confidence.
WTF? Are we in "Planet of the Apes II"? 'Cuz if we are, we're supposed to be worshipin' the BOMB! Paging Dr. Strangelove..
Seemingly the power behind the elitists want absolute control over the world and also do not want a peasant revolt.
They want the peasants to blame their slavery and hardship on themselves and not where the blame rightly belongs... at least until the power is ready to sacrifice the elitists.
Dot Com 2.0 implosion needs to happen. 22 Billion for a webpage that makes money from ads from a search engine webpage is lunacy. It's threatening to tear a hole in the space-time continuum.
If there's one sure sign the oligarchs are behind Facebook and Google, it's the fact they are considered the market leaders on the internet. The internet scares the shit out of the oligarchs, and they want to control it.
Despite Crude Oil WTI soaring, I don't think that entering a short-term long position is justified at the moment in terms of risk and reward.
http://tripstrading.com/crude-oil-wti-1h-chart/
Everything in this article and the posts is true.
What really irks me as much as anything else about financialization is that just about everything is done using an existing TEMPLATE. Then just filling in the blanks before achieving a great bonus of some sort. All these TBTF Wall Street f*cks cannot operate without an exisiting TEMPLATE. They can't even generate decent returns with ZIRP and (hidden QE) because they are a bunch of nothings but TEMPLATE-FILLER-OUTERS doing their jobs by rote. Just look At Deutsch Bank. Banksters are a bunch of grossly overpaid pimp-ass nothings who could go their entire career without one original thought.
And all the coverage of the FOMC meeting yesterday showed that the twelve FED governors are also nothing but TEMPLATE USERS.
Compare a worthless (and harmful) TEMPLATE-FILLER-OUTER to, say, an author who comes up with 300+ pages of original material resulting so-so sales and a modest standard of living. Other examples abound.
WTF KIND OF COUNTRY ARE WE LIVING IN?
"WTF KIND OF COUNTRY ARE WE LIVING IN?"
I don't think we can properly call it a country, it can be more properly called an empire where capital has become the singular force driving everything. Human needs, rule of law, the environment, the needs of future generations, common decency, any sense of fair play, anything that doesn't serve capital gets utterly ignored and carelessly discarded. Money doesn't just talk, it screams, so very loudly that everyone and everything else gets completely drowned out, as what we used to call a nation sinks into a mire of corruption, despair, and moral decay.
Is this really the best we can do?
Oh rest assured, there are probably already stacks of "new dollars" in salt mine caverns somewhere (complete with all female "presidents" -- dolly madison, clara barton, eleanor roosevelt, and rosa parks). Don't believe for a moment the mofo's in charge are falling for their own con. All the apparent gridlock, contentiousness, and confusion is just an elaborate show. When the end comes, the proper assets to own will already have been monopolized by the wealthy few. Allocation, planning, protesting are all meaningless. The oligarchs can and will take everything in the world they want. Your only hope is to shuffle and jive for the pennies they choose to throw. You are servile to the machiine. There is no redpill.
The hell with money! It's about numbers people! Numbers! We need a copius amount of numbers! You know, to overcome that scarcity thing... not enough numbers. Yes, numbers.
SO Friedman's dream comes true.
Supply Side wins all the profits; to the extent where demand is now meaningless as its paid for in free money and only generates debt !
"That Bastard Keynes LOVED demand side shenanigans. Well guess what? I love supply side shenanigans. And John Galt is now in charge of the WS beanstalk and the FED print to infinity!
Do ya hear me now??? Its a perpetual machine and in HFT algo mode (just like Hayek said in his 'on the road to monetary serfdom' dreamsong, cybernetic frontrunning Johnny! )
I said JOHN GALT ! So we can't be wrong ! "
Ayn Rand is laffing her head off in God's Fountainhead, while John, her hero, basks in the WS fountainhead.
Who is John Galt the antivillain, the true hero ?
Its a riddle wrapped up in an mystery and packaged in an enigma !
It could only be Ben wrapped up in QE and packaged in ZIRP !
Congratulations, ZH, for finally figuring out that since the DJIA bottomed in March 2009, its Fairy Godmother and Godfather (aka Wall Street and the Fed) will never let the market trade honestly and sell off uncontrollably.
Once a month or two -- or every so often -- the Big Daddies will agree on on an upper number for the DJIA and their Houses and the banks, at that agreed upon number, will sell stocks and options and otherwise "go short". The Fed accommodates them by informing them about some soon to be announced bullish or bearish news.
After the market begins its inevitable drop to the lower band of the trading range, the Lloyds and Jamies and the other Princes of Lower Manhattan all decide on a number below which the DJIA "shall not pass." When the market gets there it heads north again.
This is how the noble institutions of Wall Street make their profits: 'selling the market at the top of the band, forcing the market down, buying the dip' and then forcing the market back up.
When you and I buy the dip we don't move the market. But buying by the big firms in collusion with one other actually ends the dip and begins the move to the upper band.
The profits that they make on shorting the top and buying back at the bottom helps pay for keeping their lights on, paying the rent, restocking petty cash and if theres any left over, bonuses for the guys.
I think what you fail to realize is this has actually been going on since before Jesus was born.
Let's audit the Fed and find out how many hundreds of billions they have pumped into the market via third party central banks. The Swiss balance sheet told the whole story........