How Can People Be So Stupid? Rotating Header Image

Was Stock Market Crash on Eve of Senate Vote to Audit Fed Bankers’ Shot Across Congress’ Bow

I don’t believe in coincidences. I also do not believe the 1000 point stock market crash on May 6, 2010 was the result of a “fat fingered” trader causing a computer generated selling crescendo. Is it possible? Yes. Was it likely to happen? No! I’ve been a very active trader of stocks and commodities for decades. I watch the market almost every waking minute, 6 days a week. I am considered a “day trader” in some of my accounts. I don’t hesitate to buy and sell in the period of minutes. I’ve never been a believer in buy and hold. And, given that I am monitoring hundreds of stocks and commodities at any give moment, and graphing out dozens of stocks, options, and commodities within a sophisticated, day trading, automated trading capable system, I have seen many market crashes and short squeezes. Never in my life have I seen anything like what happened on May 6. I was actually not in front of my computer monitors at the moment that the market melted down.  I was walking from my truck to my computer screens at the minute of the breakdown. I was listening to CNBC on my XM satellite radio while I ran some errands. When I parked, the market was down about 300 points. When I got in my office a few moments later, the market was down over 900 points! I did a literal double-take, and I did some buying. (Although even I was not fast enough to intelligently enter orders; I just had some good-til-canceled orders executed, while I struggled to reset the dozens of low price alarms that were going off from the hundreds of stocks and commodity options that I trade and follow!) I had no doubt that the market would recover (to some extent), because there clearly was no reason for the almost instantaneous drop.

Yes, there are problems in Greece. But, those problems are simply the fruits of socialism coming home to roost. As the bumper sticker says, “Socialism is great until you run out of the other person’s money.” Well, Greece has been living under a totally unrealistic socialistic system for decades. Now that a majority of Greek citizens have become dependent on government goodies, the goodies have run out, and the people are upset. It reminds me of the woman who was so excited about Obama being elected president. She said something like “I am so happy. Now Obama will pay my mortgage.” Or, the morons who were calling the government after the passage of Obamacare asking how they could sign up for their free health care! Any time the government gets involved, you know two things. Costs will go up, not down, and services will degrade. But, most Americans are, sadly, stupid.

But, getting back to the point of the market crash. It was reported that a trader at Citibank had pushed the “b” (for billion) button instead of the “m” (for million) button when trading Proctor and Gamble. If Citibank has a trading system that is so stupid that it does not flag an error like that before executing a trade, they deserve to go bankrupt. In fact, that is really the point. The banks that went broke deserved to go broke, and should have gone broke. The idea that some private corporation is “too big to fail” is a recipe for disaster. Yes, some of these banks being forced to declare bankruptcy would have been painful. But, by bailing them out, the government only rewarded bad behavior, and just put the time of ultimate reckoning off by a few years. And, even worse than that, by bailing out these banks, the government has essentially bankrupted the entire country, and totally enslaved future generations to either dealing with government bankruptcy, or crippling taxes, rather than just letting a few companies go bankrupt.  In the same way, Greece should simply say they are bankrupt, and will not repay the debts that they cannot afford to repay, in the same way that Iceland said they are not going to repay some of their debts. After all, trying to repay impossible to repay debts just leads to more trouble. Just like young Americans cannot expect much in the way of social security payments, because social security is, and always has been, a Ponzi scheme, former employees of GM cannot  expect to get anything close to what they were promised in their retirement years, because their unions basically bankrupted GM. People who depend on a company, or especially the government, are setting themselves up for disaster. At some point, the “other person’s money” runs out, as Greek citizens are now finding out.

In the case of the market crash, it came on the verge of the Senate passing a bill that would require the auditing of the Federal Reserve system. The “Fed” is a private, totally unaccountable, corporation. It was founded in secret, and operates in secret. It could be argued that the Fed, and other private bankers and banks, rule the world. People like Obama are only doing their bidding. Before the crash, it looked like the Senate would pass a bill that would require frequent monitoring of the Fed, as well as reporting as to the banks that received the bailout funds. After the crash, it looks like that bill will be greatly restricted in it’s ability to monitor the Fed and expose bad banks.

Is it possible that the powers that be (the Federal Reserve and other international banking cartels), decided to give the government their own version of “Don’t Tread On Me!”? If that was the reason for the crash, it seems to have worked. Again, the timing and suddenness of the crash was very suspicious, if you, like me, don’t believe in coincidences.

Leave a Reply

Maximum 2 links per comment. Do not use BBCode.