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Ninety-six Months (96) and No ‘Real’ Correction!

April 19, 2017

Image result for Dow index graph since 2009

This chart covers 88 months. The Dow index is currently at 20,463. No Correction!

Have business cycles been eliminated now that our Central banks trade our markets? It has been 96 months of continuing up stock markets with no real correction. A correction of 20% or more should have happened prior to now. But why are major corrections now slowed or eliminated? Did you know that all our markets are now operating within cyberspace. Cyber markets are computer markets. Cyber markets allow our high frequency computers to trade and influence trends and directions. Who can influence trends and directions today? Think…our Central Banks! Central Banks ‘trade’ our markets and these money factories have unlimited cyber digits (called money) to trade with. They can pump up a market which retail traders desire to short and/or sell. It’s all done with the computer and a trading strategy.

Computers rule over all our global markets today and select computers at the New York Federal Reserve, the Exchange Stabilization Fund, and within the Bank for International Settlements (BIS) can affect trends and directions as these entities have UNLIMITED money digits (called money) to influence market direction. Also, the Central Banks of China, the European Union, and the Bank of England can also influence stock and bond trends with their daily (24/7) trading. The game has changed from the days when our retail and speculative traders ruled over our markets. Human trading has been replaced with algorithmic trading and with high frequency trading. We now live with Central Banks and trading facilities which control all our electronic/cyber markets with their trading strategies.

Few understand what is happening as they have not realized what our Central Banks can do to prevent a normal market correction. So when will our markets correct (say 20% or more) to reflect the realities within our markets? I would suggest that our markets will correct when our Central Banks choose for the markets to correct. Currently interest rates are trending DOWN even though our Fed just recently raised the Fed Funds Rate. On March 15, our Fed raised the Fed Funds Rate to 1% and since then the 10 year treasury rate has declined to 2.21%. What is happening? Rates are not adjusting upward as many would expect. What happens is that we now live with electronic markets where all interest rates can be manipulated by Central Bank trading to influence direction. This also happens with all our electronic stock exchanges!

Yes, a correction will eventually happen in spite of the Fed and our Central Bank manipulations. But so far we have had no real correction for some 96 months. The reason is our electronic markets and our Central Bank trading facilities which continue to manipulate markets to create their vision of reality. Has the Business Cycle been eliminated? It appears that it has for the time being. All this happens as our markets now operate via algorithms, high frequency trading, and with Central Bank trading activity to influence trends and direction. The New York Fed has some 500 day traders at 33 Liberty Street who can trade any stock, commodity, or derivative to influence our markets. Also, Central Banks in Europe, China, Japan, England, and other venues can do likewise. Who is AWARE? Few to none! Think for yourself! I am:

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