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Algorithms – Key ‘tool’ for Market Manipulations!

April 9, 2013 . This video is one of the best I have watched on the nature of today’s trading markets. We now live in a World of HFT Machines which trade stocks, bonds, currencies, commodities, and derivatives in real-time daily. Some 65% of all trading is now done via ‘algorithms’. No human input is required for this type of trading. Algorithms can now even read the global news and then trade after interpreting the information without any human input. All this is now done at near the speed of light. The use of ‘algorithms’ for trading/investing has created our global ‘manipulated’ markets. Few pundits seem current on the implications which these Machines produce!

What has created this new World of Machines for our global trading, investing, and speculating? The completion of the underwater fiber optic cable system created the infrastructure for this new high-speed trading. Fiber Optic cables have now been installed (under the oceans of our planet) throughout the globe. These cables allow communication and information to be transferred at near the speed of light from city to city and country to country. It now takes only milliseconds to send a trading transaction from New York to London. Trading is now mostly 24/7 and most stock markets are becoming virtual (electronic) markets where transactions are completed without any human input. What a world we live in!

The old days of the ‘open outcry’ system for determining PRICES of stocks, commodities, and other financial derivatives has transitioned to electronic markets with mathematical algorithms determining most PRICES. Traders now are mostly interested in following money flows as displayed within their computer screen platforms. As the money flows move in a ‘bull’ psychology, the traders make their bets to follow this trend. If a trend reverses the traders get out of the trade and wait for a new direction.  Traders have little interest in the fundamentals of a Company, the Management, or the Business History of a company. Their prime focus is PRICE movements in real-time, volume, and money flows. Algorithms now interpret most of these factors and then trades are executed by a computer program.

This type of machine driven system is ideal for manipulating markets in directions that have no meaning for improving our economy or our prosperity as a Nation. Money has become a ‘digit’ in the computer screen and maximizing ‘digits’ in real-time is the focus of traders today. A commodity like Silver can have a strong demand relative to supply and yet the PRICE can be manipulated down (suppressed). Price suppression can be accomplished by various trading strategies via these algorithmic machines. Any trader that can afford a HFT computer can initiate a trading strategy for market manipulation. The above video gives the evidence.

Everyone needs to take the time to watch some You Tube videos…which show how today’s markets work. Many retail investors are totally unaware of what has evolved in just the past 7-8 years. Our new technologies and math driven finance has totally changed our World of trading and our World of economics. In fact most successful traders today have degrees in physics, mathematics, and computer science rather than the historical education from business schools. Math and algorithms now dominate trading and price discovery for the markets. The markets are now mostly manipulated and machine driven.

If you desire to understand what has evolved these past 7-8 years, take the time to watch this video: You will better understand why all markets today are MANIPULATED! Enjoy! I am:

2 Comments leave one →
  1. MARK KLEIN permalink
    April 10, 2013 8:12 pm

    Mark Reading this and watching the video makes me really NOT want to be in the stock market. Makes me want to find a fricken Island and take my family, farm and get out of here. LOL mark Date: Wed, 10 Apr 2013 02:53:35 +0000 To:


    • April 10, 2013 9:14 pm

      Yes, Mark, I agree that the issues are very dire today. We need to stay calm and wait out the storm that is coming!


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