If you have been observing the market since early March, there would be no necessity to explain that Mr. Trump is very concerned with the presidential election coming soon and that the Fed has been actively manipulating the financial market since last week.
After the historic unemployment benefits record was announced last week, 326K which had been predicted to be about 160K, NASDAQ futures rose by 200 points over the next 20 minutes. Watching the market at the moment, I first assumed that NYSE might be struggling with technical issues from accelerated panic sells or AI algorithms.
Nope, there was no technical issue and the US stock market started a two-day back-to-back rise.
Direct manipulation of the stock market is totally against every single economic principle, but it can be understood if there is really urgent necessity for the government to stabilize the wall street at least regarding that the main street is already in panic.
IF that happened ONLY ONCE, it could have been understandable.
Few hours ago, the all-time high unemployment benefits record was again renewed just a week after the historic record last week, and then NASDAQ futures quickly dropped about 180 points, which seems normal.
But it rebounded 233 points over the next 90 minutes. It does never seem normal.
How could it rebound that much that fast? Because there are 664.8K people who lost their jobs and more people are expected to be laid off over next weeks or months? Are the 6.6 millions of unemployed people facing dire environments and incalculable amount of additional fiscal expenditures good news for the stock market?
Capitalism is based on money whose functions cannot help but be established on trusts of market participants, and money can work as the medium of exchange if and only if it attains credit of market participants(population). The both are always taught as the most representative principles among 6 characteristics and 4 functions of money at Introduction to Economics class at every college in every country. Am I the only one who thinks that the current market is totally violating the principles?
I can’t understand why everyone stays silent while the Fed and the Trump administration are blatantly manipulating the securities market. Does printing money every time NASDAQ breaks 7500 points contribute to increasing the credit of the market or resolving liquidity issues? Then why don’t we force stocks to go upwards forever without any adjustments through printing money whenever they go down?
If the market rises and drops by the president’s tweets or central banks’ newly printed money, how can we call this investing in stocks not betting on luck even if we end up making profits? Given that casino always wins by probability as its system is structured in that way, how is investment in such a manipulated market different from gambling if market participants can never win unless they have high-ranking public officials friends?
The role of the government is to monitor whoever distorts the market, not reining the market. Such scam is publicly happening in 2020 in the states, but no one is issuing it.
I feel as the end of the historic rig being performed by the US government and the Fed is near. Every great investor and trader from Jesse Livermore to Peter Lynch has said not to fight the market, and the Fed dared.
No one can exactly when it would, but it’s clear the doom’s day is coming. Second crash seems to be inevitable.
If the market really ends up going up without any adjustments, as Mr. Trump wishes for his second election, it would automatically prove that economics is not a science and that there exists no need for colleges to offer economics major.