{"id":11470,"date":"2015-08-26T08:15:42","date_gmt":"2015-08-26T13:15:42","guid":{"rendered":"http:\/\/olduvai.ca\/?p=11470"},"modified":"2015-08-26T08:15:42","modified_gmt":"2015-08-26T13:15:42","slug":"what-if-the-crash-is-as-rigged-as-everything-else","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=11470","title":{"rendered":"What If The “Crash” Is as Rigged as Everything Else?"},"content":{"rendered":"

What If The “Crash” Is as Rigged as Everything Else?<\/a><\/h3>\n

Take your pick–here’s three good reasons to engineer a “crash” that benefits the few at the expense of the many.<\/i><\/p>\n

There is an almost touching faith that markets are rigged when they loft higher, but unrigged when they crash. Who’s to say this crash isn’t rigged?<\/b>\u00a0A few things about this “crash” (11% decline from all time highs now qualifies as a “crash”) don’t pass the sniff test.<\/p>\n

Exhibit 1: VIX volatility Index soars to “the world is ending” levels when the S&P 500 drops a relatively modest 11%.<\/b>\u00a0The VIX above 50 is historically associated with declines of 20% or more–double the current drop.<\/p>\n

When the VIX spiked above 50 in 2008, the market ended up down 57%. Now that’s a crash.<\/p>\n

\"\"<\/p>\n

Exhibit 2: The VIX soared and the market cratered at the end of options expiration week (OEX), maximizing pain for the majority of punters.<\/b>\u00a0Generally speaking, OEX weeks are up. The exceptions are\u00a0out of the blue lightning bolts<\/i>\u00a0such as the collapse of a major investment bank.<\/p>\n

Was a modest devaluation in China’s yuan really that unexpected, given the yuan’s peg to the U.S. dollar which has risen 20% in the past year? Sorry, that doesn’t pass the sniff test.<\/p>\n

\"\"<\/p>\n

Exhibit 3: When the VIX spiked above 30 in October 2014, signaling panic, the Federal Reserve unleashed the\u00a0Bullard Put<\/i><\/b>, i.e. the Fed’s willingness to unleash stimulus in the form of QE 4. Markets reversed sharply and the VIX collapsed.<\/p>\n

Now the VIX tops 50 and the Federal Reserve issues an absurd statement that it doesn’t respond to equity markets. Well then what was the Bullard Put in October, 2014? Mere coincidence? Sorry, that doesn’t pass the sniff test.<\/p>\n

Why would “somebody” engineer a mini-crash and send volatility to “the world is ending” levels? There are a couple of possibilities.<\/b><\/p>\n

 <\/p>\n

…click on the above link to read the rest of the article…<\/p>\n","protected":false},"excerpt":{"rendered":"

What If The “Crash” Is as Rigged as Everything Else? Take your pick–here’s three good reasons to engineer a “crash” that benefits the few at the expense of the many. There is an almost touching faith that markets are rigged when they loft higher, but unrigged when they crash. Who’s to say this crash isn’t […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[8437,127,1450,303,305,500,501,4924,661,662,1234,1141,2773],"class_list":["post-11470","post","type-post","status-publish","format-standard","hentry","category-economics","tag-bullard","tag-charles-hugh-smith","tag-equity-markets","tag-fed","tag-federal-reserve","tag-market-collapse","tag-market-crash","tag-oftwominds","tag-qe","tag-quantitative-easing","tag-stimulus","tag-vix","tag-volatility"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/11470","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=11470"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/11470\/revisions"}],"predecessor-version":[{"id":11471,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/11470\/revisions\/11471"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=11470"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=11470"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=11470"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}