The Plunge Protection Team

[wayneL]

The US stock markets are largely manipulated these days and it became very obvious to me and my futures trading colleagues. It's one of the reasons for my comments on the US elsewhere.

Check out this article:

http://safehaven.com/article-4717.htm

March 05, 2006

The Plunge Protection Team Intervention Risk Indicator
by Robert McHugh


For the past several years, we have seen repeated "out of the blue" short-covering rallies just about the time a decline seems to be gaining some momentum. Our suspicion has been that the "Working Group" established by law in 1988 to buy markets should declines get out of control has become far more interventionist than was originally intended under the law. This group has since been dubbed the Plunge Protection Team. There are no minutes of meetings, no recorded phone conversations, no reports of activities, no announcements of intentions. It is a secret group including the Chairman of the Federal Reserve, the Secretary of the Treasury, the Head of the SEC, and their surrogates which include some of the large Wall Street firms. The original objective was to prevent disastrous market crashes. Lately it seems, they buy markets when they decide markets need to be bought, including equity markets. Their main resource is the money the Fed prints. The money is injected into markets via the New York Fed's Repo desk, which easily showed up in the M-3 numbers, warning intervention was nigh.

This past November, the Fed announced with little comment and no palatable explanation that it would no longer report the M-3 number after March 2006. It is now almost March 2006. Without the useful resource of M-3, we need to find other tools to monitor when the PPT is likely to intervene, and kill shorts..........................

 

[Knobby22]

Have to get Soros onto it.

I have to admit that this article you found Wayne makes me more scared of a terrible collapse in the US. Is the place run by idiots? And this from a country that pretends to represent free trade and laissez faire economic controls. The next President better be of better material.

 

[wayneL]

Have to get Soros onto it.

I have to admit that this article you found Wayne makes me more scared of a terrible collapse in the US. Is the place run by idiots? And this from a country that pretends to represent free trade and laissez faire economic controls. The next President better be of better material.

The US is run increasingly by ideologues with little regard for freedom at all. (patriot act for instance) The US government no longer acts as a representitive of the people, rather as an entity that protects itself from the people.

The T word is the ideal emotional latch with which to keep the sheeple distracted. I am convinced we will see an increasingly totalitarian regime in the US... and even the UK. There are some very disturbing pieces of legislation in both countries.

....and here for that matter

 

[happytrader]

The US stock markets are largely manipulated these days and it became very obvious to me and my futures trading colleagues. It's one of the reasons for my comments on the US elsewhere.

Check out this article:

http://safehaven.com/article-4717.htm

Hi Wayne

Your market observances do not surprise me, after all its no secret the US tries to control everything.

Welcome home.

Cheers
Happytrader

 

[professor_frink]

IMHO, the very scary part of all this is what happens when the wheels finally fall off(which they eventually will) and the market falls even with their intervention?
How much money are they going to print then?
that will have a lovely effect on inflation!
Dunno how much more they can lie about those figures
On the other hand I'd rather not think about that too much, I might start feeling depressed!

 

[ctp6360]

This will probably sound ignorant, but is the Australian stock market subject to any artifitial manipulation along these lines? Is it even possible?

 

[happytrader]

This will probably sound ignorant, but is the Australian stock market subject to any artifitial manipulation along these lines? Is it even possible?

Hi ctp6360

I've always said so. Its 'they' or the institutions that move the big bluechips. That business of closing the market at 4.15pm was very interesting. As traders we are merely looking for 'tracks' and playing follow the leader. Better the devil you know than the devil you don't.

Cheers
Happytrader

 

[wayneL]

This will probably sound ignorant, but is the Australian stock market subject to any artifitial manipulation along these lines? Is it even possible?

Every market can and does get manipulated by the big players... end of quarter/year window dressing, pump and dumps, fraudulent financial statements etc being prime examples.

These are part and parcel of markets, whether it's stock markets or the local fruit and veg. It's part of the landscape we've all had to deal with...always.

The ASX is no exception. But as far as I'm aware, there is no gu'mint intervention.

If that happens, I'm off to Patagonia.

 

[wayneL]

FYI

 

[Ageo]

Hehe the more and more i watch these clowns on CNBC etc.... the more and more i realize most of them have no idea and i cant believe they get air time. Out of all those speaking only 1 made sense (but nooooo our U.S government doesnt manipulate!!!!) living in denial will only set them back further.

 

[Sean K]

I do wonder how the trading is executed though.

Does the Govt have accounts with various brokers to manipulte the market, or is GWB and HP sitting in the Oval Office on their laptops buying big through Comsec?

 

[wayneL]

I do wonder how the trading is executed though.

Does the Govt have accounts with various brokers to manipulte the market, or is GWB and HP sitting in the Oval Office on their laptops buying big through Comsec?

I am told it is via Goldman Sachs. Apparently GS a/c 95 is the PPT account.

Disclaimer: Complete hearsay.

 

[prawn_86]

I am told it is via Goldman Sachs. Apparently GS a/c 95 is the PPT account.

Disclaimer: Complete hearsay.

I would have thought it would be with JP Morgan.

JP are the only untouchable investment bank with a blank cheque from the fed it seems

 

[wayneL]

I would have thought it would be with JP Morgan.

JP are the only untouchable investment bank with a blank cheque from the fed it seems

Hmmm.... it was a while ago. I'm sure it was GS, but you may be right.

Deep into idle banter territory here.

 

[MRC & Co]

I would have thought it would be with JP Morgan.

JP are the only untouchable investment bank with a blank cheque from the fed it seems

JP Morgan were the fed in the early 1900s weren't they! ha ha.

Provided liquidity back then when there was none.

 

[Ageo]

JP Morgan were the fed in the early 1900s weren't they! ha ha.

Provided liquidity back then when there was none.

Well JP Morgan was 1 (of the few) who actually helped pass the Federal Reserve Act (1913) hmmm

 

[MRC & Co]

Yeh, in a crash a few years before that, there were literally no buyers, banks were out of cash. Mr Morgan himself had to release funds from what I read (reminiscences). Basically the same as the Fed.

 

[prawn_86]

And that sentiment still echoes through today. Who was it that received the Fed backing to take over Bear Stearns? JP of course.

JP Morgan is the public, buying up stuff, face of the Fed/gov imo, thats why i would be very surprised if the PPT use a Goldman Sachs account. But its all pure speculation and its just what i think

 

[chops_a_must]

I remember seeing that at the time on CNBC. Cracked me up. Posted about it on one of your other PPT threads WayneL.


JP Morgan is the one stock in the US I don't even bother looking at for plays. Its chart defies gravity... and defies me.

The other night, CNBC were saying, "Why is Citi tanking? Its balance sheet is exactly the same as JP Morgan's." LOL... yep... it sure is. But who is going to go to town on it?

Being on Wikipedia, makes it official IMO lol:

http://en.wikipedia.org/wiki/Plunge_Protection_Team

Market Crisis of 2008

On 06 October 2008, the working group issued a statement indicating that it was taking multiple actions available to it in order to attempt to stabilize the financial system, although purchase of stock shares was not part of the statement.[12] The government may wind up owning shares in the firms to which it has provided loans, as they will receive warrants as collateral for these loans.

 

[prawn_86]

JP Morgan is the one stock in the US I don't even bother looking at for plays. Its chart defies gravity... and defies me.
.

They say some banks etc are to big to fail, IMO JP is too big and too intertwined to even look like it might come close to failing. Havn't seen them cutting too many jobs either...