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Meet The Finance Professor Exposing Rigged Markets One Academic Paper At A Time

October 14, 2018

Meet The Finance Professor Exposing Rigged Markets One Academic Paper At A Time

Finance professor John Griffin, along with his doctoral student companion, Amin Shams, were the two academics that drew market-moving conclusions about bitcoin last year, while the digital currency was trading around $20,000. After sifting through 2 terabytes of trading data, they alleged that bitcoin was being manipulated by someone using the cryptocurrency Tether to purchase it. Tether remains a relatively little-known crypto, which is pegged to one US dollar. Part of its appeal is that it can “stand in” for dollars when necessary, according to Bloomberg.

Griffin and Shams authored a paper in June, with the results of their findings ultimately catalyzing many digital assets to move lower, despite the fact that the CEO of Tether publicly denied that its currency was used to prop up bitcoin.

Griffin works at the University of Texas at Austin, and has become quite an unpopular figure on Wall Street for similar work he has done in the past on ratings companies, the VIX and investment banks. In most of his findings, he claims that these well-known financial instruments and players are, in one way or another, rigged. And the professor seems to enjoy exposing precisely that: rigged, manipulated markets and shady players.

“I not only want to understand the world, but make it better,” he told Bloomberg.

Griffin’s work has become popular reading within the DOJ and the Commodity Futures Trading Commission, according to Bloomberg. These regulators – many of them low on resources, time and staff – welcome any additional help they can get (the SEC’s budget has forced it into a hiring freeze and the CFTC budget was cut by Congress in March of this year).

…click on the above link to read the rest of the article…

The day I found out it was all rigged

January 8, 2018

The day I found out it was all rigged

May 6, 2010 started off as a pretty boring day.

The most exciting stories from the morning’s newspapers were reviews of the upcoming Iron Man 2 film.

But all that changed at around 2:45pm when, without warning, the stock market crashed, and the Dow Jones Industrial Average dropped 1,000 points within minutes.

It was unprecedented… especially because there was absolutely no reason why stocks should have fallen so much.

It’s not like Apple had declared bankruptcy, or the Central Bank had jacked interest rates up to 50%. Up until that point it had been pretty quiet in the markets.

As it turned out, the reason behind the crash was that the investment banks’ fancy trading algorithms had gone completely haywire.

Several of the largest banks had developed autonomous software that was capable of trading billions of dollars without the need for human beings.

And at 2:45PM that day, their software started to fail… inexplicably selling stocks to the point that prices collapsed nearly 10% in minutes.

They called it the Flash Crash, and, even though stocks had largely recovered by the end of the day, the banks lost an enormous amount of money.

Then something interesting happened. Within a few days, the major exchanges announced that they would CANCEL many of the trades that took place during the Flash Crash window.

In other words, they were handing the banks their money back.

I never forgot that moment… because I received an email from my broker informing me of the news.

They were canceling a profitable trade that I had placed during the Flash Crash window, effectively giving it back to the banks.

When the banks’ trading algorithms performed well and they all made money, the profit was theirs to keep.

…click on the above link to read the rest of the article…

Stupid is as Stupid Does

April 5, 2017

STUPID IS AS STUPID DOES

If you prefer fake news, fake data, and a fake narrative about an improving economy and stock market headed to 30,000, don’t read this fact based, reality check article. The level of stupidity engulfing the country has reached epic proportions, as the mainstream fake news networks flog bullshit Russian conspiracy stories, knowing at least 50% of the non-thinking iGadget distracted public believes anything they hear on the boob tube.

This stupendous degree of utter stupidity goes to a new level of idiocy when it comes to the stock market. The rigged fleecing machine known as Wall Street has gone into hyper-drive since futures dropped by 700 points on the night of Trump’s election. An already extremely overvalued market, as measured by every historically accurate valuation metric, soared by 4,000 points from that futures low – over 20% – to an all-time high. Despite dozens of warning signs and the experience of two 40% to 50% crashes in the last fifteen years, lemming like investors are confident the future is so bright they gotta wear shades.

The current bull market is the 2nd longest in history at 8 years. In March of 2009, the S&P 500 bottomed at a fitting level for Wall Street of 666. In a shocking coincidence, it bottomed on the same day Bernanke & Geithner forced the FASB to rollover like mangy dogs and stop enforcing mark to market accounting. Amazingly, when Wall Street banks, along with Fannie and Freddie, could value their toxic assets at whatever they chose, profits surged. The market is now 240% higher.

You have the second longest bull market in history, while stock market valuations, as measured by the Shiller PE ratio and every other historically accurate valuation method, are higher than 1929 and 2007, but the Wall Street hype machine and the business network shills adamantly declare this bull has years to go and thousands of points of upside.

…click on the above link to read the rest of the article…

The A.I. Economy, An Open Secret: “Why the Market Never Crashes”

March 11, 2017

The A.I. Economy, An Open Secret: “Why the Market Never Crashes”

market-party

How are they keep this dying patient, the economy, together?

Perhaps we are long past the point of an organic, “real” economy. Instead, autotrading and artificial intelligence appears to be auto-investing into the stock market and other parts of the economy in order to keep it afloat.

Meanwhile, the individual will be increasingly barred from using cash, and forced onto a digital, tracking system.

Matthew McKinley of Texas Shrugged Books explains why he thinks that the system hasn’t crashed yet in spite of overwhelming systemic problems, and plenty of room for crisis.

Basically, everything is rigged, and we are at the mercy of a more organized, data-loving computer.

via Texas Shrugged Books:

I am sick of the talking heads who all swore up and down that 2016 would be the year of collapse, and of course, it didn’t happen. All of these talking heads are so arrogant, they can never admit they were wrong. Saying “I was wrong” allows one to stop running down the wrong path, reassess, and find the right track. In my opinion some form of A.I. and supercomputer is injecting the system with “printed” money so nothing really fails. I am not just talking about banks. I think, at this point, “regular industry” of a certain size is also getting these magic funds. This is almost the only way to explain how nothing has really failed since 2009. This magic show will go on for as long as the rest of the world still covets our fake monopoly money painted green. So, if no group of countries begin using real money or any other way of rejecting the dollar by bartering locally for example, this system will go on that long. It could be another decade I just don’t know at this point, but it cannot go on forever. A system based on lies, manipulation, and fakery can’t go on forever.

…click on the above link to read the rest of the article…

Fourth Turning–Social & Cultural Distress Dividing the Nation

November 28, 2015

FOURTH TURNING – SOCIAL & CULTURAL DISTRESS DIVIDING THE NATION

I wrote the first three parts of this article back in September and planned to finish it in early October, but life intervened and truthfully I don’t think I was ready to confront how bad things will likely get as this Fourth Turning moves into the violent, chaotic war stage just over the horizon. The developments in the Middle East, Europe, U.S., China and across the globe in the last months have confirmed my belief war drums are beating louder, global war beckons, and much bloodshed will be the result. Fourth Turnings proceed at their own pace within the 20 to 25 year crisis framework, but there is one guarantee – they never de-intensify as they progress. Just as Winter gets colder, stormier and more bitter as you proceed from December through February, Fourth Turnings get nastier, grimmer, more perilous, with our way of life hanging in the balance.

In Part 1 of this article I discussed the catalyst spark which ignited this Fourth Turning and the seemingly delayed regeneracy. In Part 2 I pondered possible Grey Champion prophet generation leaders who could arise during the regeneracy. In Part 3 I focused on the economic channel of distress which is likely to be the primary driving force in the next phase of this Crisis. In Part 4 I will assess the social and cultural channels of distress dividing the nation, Part 5 the technological, ecological, political, military channels of distress likely to burst forth with the molten ingredients of this Fourth Turning, and finally in Part 6 our rendezvous with destiny, with potential climaxes to this Winter of our discontent.

The road ahead will be distressful for everyone living in the U.S., as we experience the horrors of war, economic collapse, civil chaos, political upheaval, and the tearing of society’s social fabric. The pain and suffering being experienced across the globe today will not bypass the people of the United States.

…click on the above link to read the rest of the article…

 

Former SEC Director Admits The Truth: The Market Is Rigged

March 10, 2015

Former SEC Director Admits The Truth: The Market Is Rigged

For more than a decade, John Ramsay kept his mouth shut about how rigged the US equity market was.

As SEC Director of Trading & Markets, Ramsay tells Bloomberg her “had red tape over his mouth,” but now he is “uncorked.”

“I’ve been able to find my voice on these issues in a way I couldn’t have done when I was in the government, because you’re always limited by internal politics and not wanting to get too far out in front of the agency,” he said. “I feel like I’ve been a little bit uncorked.”

Having joined Brad Katayama’s IEX Group (infamous for the Flash Boys’ exposure), Ramsay  is calling out the “convoluted” and “illogical” pricing rules of major stock exchanges and compared the $25 trillion U.S. stock market’s structure to the Death Star of “Star Wars.”

It will be hard for current regulators to shrug off Ramsay’s comments,

“He’s a guy who accomplished a lot and doesn’t have anything to prove,” said James Burns, who worked with Ramsay at the SEC and is now a partner at the law firm Willkie Farr & Gallagher LLP.

Ramsay helped the SEC hammer out the post-crisis Volcker Rule, which bans government-insured banks from gambling with depositors’ money. The rule has an exemption — it allows banks to continue “making markets,” or standing ready to buy or sell stocks and bonds from customers. Financial regulators initially clashed over that exemption, with banking agencies fretting that the language would open loopholes for Wall Street to exploit.

Ramsay helped ease the tension with clear language and humor, bank regulators said. Ramsay was the voice at the table “making us understand how market making is done, and what kind of parameters are around it,” said Scott Alvarez, the Federal Reserve’s general counsel.

And so when he uncorks a nasty reality check on the market, perhaps it is time to listen…

…click on the above link to read the rest of the article…

 

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