http://www.chrismartenson.com/blog/market-manipulation/22801

Market Manipulation

Thursday, July 23, 2009, 2:59 pm, by cmartenson

The following is an addition to the In Session thread made today (available to all enrolled members).

I want to comment on the notion of market manipulation, which I have hinted at recently. What does this mean, « manipulation? » For me, the definition is « moving markets in a given direction for overt political or financial gain for a relative few in opposition to basic fundamentals. »

There’s lots of evidence, both direct and indirect, to support the notion that our « markets » are not really markets at all, but rather subject to non-economic forces producing something other than « orderly price discovery. »

Here’s a prime example from yesterday:

S&P flip-flop sows confusion in CMBS market

By Aline van Duyn in New York

Published: July 23 2009 00:23 | Last updated: July 23 2009 00:23

Confidence in the dysfunctional market for securities backed by commercial mortgages has been further dented after a rating flip-flop by Standard & Poor’s caused confusion.

The rating agency, which recently changed its criteria for large numbers of bonds backed by loans for shopping malls, office towers and other commercial property, upgraded bonds to triple A just days after those same bonds had been sharply downgraded.

My comments: Hmmmmmm, that’s kind of strange, don’t you think? AAA bonds had been downgraded not just ‘sharply’ as the article says, but all the way to BBB, which is right down there at the very edge of deep junkdom. From triple-A to triple-B and back again. In a few days. What could the reason for this be? Whatever the reason, we can certainly strike « economic » from our list of considerations. Let’s see if the article provides any further clues.

…

Let’s keep reading…the real reason is buried near the bottom of the article (as they often are).

The Federal Reserve is seeking to reignite the market for CMBS, in part by financing purchases of the securities, as long as they are rated triple A.

Ding! Ding! Ding! We have a winner!! It turns out that the market for CMBS is still in a deep funk and the Federal Reserve wants to step in here with its thin-air money program and start buying them up. But they are restricted to buying AAA securities. Which means that the ones that S&P downgraded could no longer be purchased by the Fed under the rules of the game as they currently stand.

Clearly the Fed wanted to buy the particular issues involved, and of the two things that could be done, forcing S&P to change its rating was deemed to be easier than changing the rules at the Fed. So S&P took another hit to its already shredded credibility (which had to gall them terribly) and made a major and embarrassing revision to a recent downgrade.

…

This raises a number of troubling issues and conclusions:

1. Ratings are not worth anything because where they were subject to market forces making them too high during the formation of the credit bubble, they are now too high due to political pressure and manipulation on the way down. Ratings are worthless.

2. Political pressure is being overtly used to effect specific market outcomes. Where else is it being used? Does any of this explain the recent stock market behavior and GS’s outlandishly good ‘trading returns’? If so, then we are in trouble, because false prices lead to bad investments and therefore serve to enable, not cure, the particular pathology that afflicts us.

3. There are still enough bad debts on the books of large banks to require this sort of skullduggery. The notion of a rebounding economy and green shoots are entirely inconsistent with this sort of desperate maneuvering. It is this sort of manipulation that leads me to be especially skeptical of the notion that the economy is on the mend. If it were, then this bizarre action would not have been required.

There are a number of other troubling issues for me here, but I think that’s a sufficient list for now. Because I can see such manipulation here in the CMBS market, I assume that manipulation is happening elsewhere, where there is perhaps less transparency. I make this assumption because in every financial crisis there are two components: the actual financial damage and the associated loss of confidence.

Of the two, the crisis in confidence is the part most addressable by politicians using their power to effect specific market behaviors. During the Great Depression, FDR used government power to directly target higher agricultural prices by openly destroying crops and livestock. The idea was that once people regained their confidence, they were supposed to begin buying and selling with their former vigor.

Under the very best of circumstances, the confidence-building efforts of the politicians will also provide outlandish returns to well-connected financial elite, who will therefore not put up any opposition to the actions.

Here we have large banks getting full price compensation from the Fed for a pile of ruined debt, in an action designed to « restore confidence » to the CMBS markets so that market participants will resume buying and selling with their former vigor. That’s a win-win-win as far as everyone is concerned.

Well, everyone except the taxpayers, of course.

What happens in Vegas stays in Vegas!! Ha, ha! Check this web site out for all of your show and concert tickets, it is a great alternative to the devil – Ticketmaster!…

- GS a accès à toutes les infos utiles, avant tout le monde, grâce à leurs « anciens » employés (Paulson, Geithner, etc…)
- GS a détruit, avec l’aide bienveillante d’Henry Paulson, son principal concurrent, Lehman Brothers.
- GS a du financement quasi-gratuit et quasi-illimité (AIG, TARP, etc…)
- GS utilise le meilleur programme d’algo-trading existant (lire le commentaire de Vladimir)
- GS, avec autant d’argent gagné (3.44 milliards USD de bénéfice sur les 3 derniers mois), peut facilement acheter et corrompre n’importe qui sur cette planète

Bref, nous assistons impuissants au plus gros jeu de l’avion de tous les temps.

D’après Politico, de l’American political journalism – organisation basée à Washington – Obama aurait affirmé devant un groupe de banquiers à la Maison-Blanche qu’il était le seul recours qui restait entre eux et les «fourches» de la population en colère qui exigeaient que Washington mette un terme au favoritisme qu’il accorde à Wall Street.

C’est le moment d’orner les fourches de quelques têtes…

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Il n’a pas donné les résultats avant tout le monde. Il a publié des chiffres mais qui n’avaient rien à voir avec les résultats officiels qui sont tombés par la suite (75 milliards de recapitalisation nécessaires pour10 des 19 premières banques américaines) puisqu’il affirmait que toutes les banques ou presque étaient insolvables. Quant à dire qu’elles sont insolvables, c’est à la portée du premier venu. Il n’est pas le seul à le dire, loin de là. D’ailleurs, de nos jours, tout le monde peut lancer un bobard. C’est ça l’ère Internet!

Soyons sérieux. Comment voulez-vous qu’un demi-dingue, néo-nazi, dans sa petite radio de rien du tout où il passe son temps à crier sa haine au monde entier, ait pu être au courant à l’avance d’informations ultra-confidentielles?

http://www.boursorama.com/opcvm/detail-actualite-opcvm.phtml?num=c4f24ddde25da2209a68cd495668005b

Quelle est la question? Toutes les allégations contenues sur le site que vous mettez en lien viennent d’un néo-nazi américain, spécialiste en théories complotistes, et qui est en prison pour avoir menacé des hommes politiques américains et d’autres personnalités publiques, et au domicile duquel on a trouvé des munitions prohibées…

Vous vous concentrez sur l’anecdote (le lien et les allégations de Turner) et non sur la question….

Ce que je crois

Il y a dans le monde beaucoup de liquidités que les invistisseurs n’osent pas placer ; tout est fait fait pour les inciter à le faire, et les trappes ou instrument de pompage (par les banques), sont prêts.

Pour ce qui est de la fin de la crise, si les citoyens refusent de s’endetter les états le font pour eux, notamment au bénéfice des banques.

A sujet de Franck Biancheri, tout ce qui traîne sur le net à son sujet vient eseentiellement de lui même, directement ou indirectement.