{"id":42296,"date":"2019-01-05T08:09:43","date_gmt":"2019-01-05T13:09:43","guid":{"rendered":"https:\/\/olduvai.ca\/?p=42296"},"modified":"2019-01-05T08:09:43","modified_gmt":"2019-01-05T13:09:43","slug":"plunge-protection-myths-keynesian-economic-myths","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=42296","title":{"rendered":"Plunge Protection Myths = Keynesian Economic Myths"},"content":{"rendered":"<div class=\"pageTitle blogTitle\">\n<h3><a href=\"https:\/\/www.armstrongeconomics.com\/armstrongeconomics101\/understanding-cycles\/plunge-protection-myths\/\">Plunge Protection Myths = Keynesian Economic Myths<\/a><\/h3>\n<\/div>\n<div class=\"mainContent\">\n<div class=\"contentWrap\">\n<div class=\"theContent\">\n<p><a href=\"https:\/\/d33wjekvz3zs1a.cloudfront.net\/wp-content\/uploads\/2018\/12\/Plunge-Protection-Team.gif\" target=\"_blank\" rel=\"noopener\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-83909 aligncenter\" src=\"https:\/\/d33wjekvz3zs1a.cloudfront.net\/wp-content\/uploads\/2018\/12\/Plunge-Protection-Team.gif\" alt=\"\" width=\"888\" height=\"500\" \/><\/a><\/p>\n<p><strong>QUESTION<\/strong>:\u00a0What about what China did by buying stocks a few years ago to stop the hang sang from dropping<\/p>\n<p>LW<\/p>\n<div class=\"wp-video\"><span class=\"mejs-offscreen\">Video Player<\/span><\/p>\n<div id=\"mep_0\" class=\"mejs-container mejs-container-keyboard-inactive wp-video-shortcode mejs-video mejs-hide-cues\" tabindex=\"0\" role=\"application\" aria-label=\"Video Player\">\n<div class=\"mejs-inner\">\n<div class=\"mejs-mediaelement\"><video id=\"video-84072-1_html5\" class=\"wp-video-shortcode\" src=\"https:\/\/d33wjekvz3zs1a.cloudfront.net\/wp-content\/uploads\/2016\/02\/Summers-Economy-Not-Predictable.mp4?_=1\" preload=\"metadata\" width=\"854\" height=\"480\" data-mce-fragment=\"1\"><\/video><\/div>\n<div class=\"mejs-layers\">\n<div class=\"mejs-overlay mejs-layer mejs-overlay-play\">\n<div class=\"mejs-overlay-button\" tabindex=\"0\" role=\"button\" aria-label=\"Play\" aria-pressed=\"false\"><\/div>\n<\/div>\n<\/div>\n<div class=\"mejs-controls\">\n<div class=\"mejs-button mejs-playpause-button mejs-play\"><\/div>\n<div class=\"mejs-time mejs-currenttime-container\" role=\"timer\" aria-live=\"off\"><span class=\"mejs-currenttime\">00:00<\/span><\/div>\n<div class=\"mejs-time-rail\"><\/div>\n<div class=\"mejs-time mejs-duration-container\"><span class=\"mejs-duration\">01:17<\/span><\/div>\n<div class=\"mejs-button mejs-volume-button mejs-mute\"><\/div>\n<div class=\"mejs-button mejs-fullscreen-button\"><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<p><strong>ANSWER<\/strong>: Do not confuse attempts to support a market from actually being able to do so. This is the same as Keynesian economics that government could prevent recessions.\u00a0Larry Summers admitted the government cannot even forecast such events. Not only during the Great Depression did companies jump in to buy their shares during the crash to try to prevent the decline. Most of the companies that took that action actually failed for they bought the stock back trying to hold the price and lost needed cash reserves. They could not sell stock again nor could the borrow.<\/p>\n<p>During the collapse of the Nikkei after 1989, companies held believing that the government would support the market. When they realized the government could not then the government encouraged us to bail out the Japanese corporations. We helped well over 300 public companies issuing a note to buy their portfolios at their cost with 10-year payouts and each note had to be approved by the Japanese government individually. If the governments were able to actually prevent declines, then they would. But nobody can do that for the size of the public at large far outweighs any institution, group of institutions, or banks.<\/p>\n<p>People would rather believe in conspiracy theories than simply look at the reality. Attempts to manipulate markets <strong>ALWAYS<\/strong> fail because the majority is far greater than any minority. The trend is made by the <strong>MAJORITY<\/strong>. A panic sell-off\u00a0like the Crash of 1987 took place <strong>BECAUSE<\/strong> there was not bid \u2013 not that there was a massive short position. Scare the <strong>MAJORITY<\/strong> and they then\u00a0try to sell, you find no bid and that is how a flash\u00a0crash unfolds. This is why outlawing short positions is destructive for the only person with the courage to try to catch a falling knife is the one who is taking profit \u2013 not initiating\u00a0a long position.<\/p>\n<\/div>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Plunge Protection Myths = Keynesian Economic Myths QUESTION:\u00a0What about what China did by buying stocks a few years ago to stop the hang sang from dropping LW Video Player 00:00 01:17 ANSWER: Do not confuse attempts to support a market from actually being able to do so. This is the same as Keynesian economics that [&hellip;]<\/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":[5496,2370,1849,467,500,5479,1180,3726,2443],"class_list":["post-42296","post","type-post","status-publish","format-standard","hentry","category-economics","tag-armstrong-economics","tag-conspiracy-theory","tag-financial-markets","tag-keynesian-economics","tag-market-collapse","tag-martin-armstrong","tag-myths","tag-plunge-protection-team","tag-stock-markets"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/42296","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=42296"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/42296\/revisions"}],"predecessor-version":[{"id":42297,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/42296\/revisions\/42297"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=42296"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=42296"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=42296"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}