Central Banks Buying Stocks Have Rigged US Stock Market Beyond Recovery

Central Banks Buying Stocks Have Rigged US Stock Market Beyond Recovery by David Haggith – The Great Recession

Central banks buying stocks are effectively nationalizing US corporations just to maintain the illusion that their “recovery” plan is working because they have become the banks that are too big to fail. At first, their novel entry into the stock market was only intended to rescue imperiled corporations, such as General Motors during the first plunge into the Great Recession, but recently their efforts have shifted to propping up the entire stock market via major purchases of the most healthy companies on the market.

Brian Rich, writing for Forbes, describes the economic illusion created by central banks buying stocks during a time of presidential prosecution:

 

The chaos and dysfunction message is loud, but markets aren’t hearing it. The real story is very different. Stocks continue to surge; stock market volatility continues to sit at ten–year (pre–crisis) lows. The interest rate market is much higher than it was before the election, but now quiet and stable. Gold, the fear–of–the–unknown trade, is relatively quiet. This all looks very much like a world that believes a real economic expansion is underway, and that a long–term sustainable global economic recovery has supplanted the shaky post-crisis (central bank–driven) recovery that was teetering back toward recession.

 

In other words, political chaos in the regime is not denting the stock market, because central banks buying stocks are eliminating volatility. Indeed, if you were to gauge the economy at this point by the US stock market, everything must be grand because the Trump Rally has been one of our most exuberant stock rallies.

According to Rich, all of that is a central-bank-created slight of hand intended to distract you from what is happening in politics and throughout the macro economy:

 

Remember, the financial media and Wall Street are easily distractible. Not only do they have short attention spans, but they’ve been trained throughout their careers to find new stories to obsess about…. We have major central banks around the world that continue to print money. These central banks buy assets with that freshly printed money. That means, stocks, bonds and commodities go higher.

 

Distract you from what? Distract you via the roaring success of stocks from the fact that the central banks’ recovery is failing everywhere. As Rich says, the fate of the world now rests on the successful outcome of these new policies because the banks that are now too big to fail are the central banks, themselves. The Fed and its central proxies are creating a grand distraction from a story that would chill America to the bone … if the truth were told.

 

Proofs of central banks buying stocks to rig the market

 

The Federal Reserve already confessed it rigged the stock market last January in hopes of creating a “wealth effect” throughout the US economy. Its plan, confessed by ex-Fed governor Richard Fisher was to front-run the stock market with its forward messaging about bond purchases though which it created massive liquidity that would be invested in stocks.

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David Haggith

Knave Dave — vigilante against the false profits of The Great Recession Too many criminal CEOs still fill their porky bellies with the biggest taxpayer bailouts in the history of the world. These bailouts protect their reputations, saving them from the fall they should have taken. They continue to receive bonuses for having done an unparalleled job of destroying their companies! Many of their companies wouldn’t be making any profit at all if not for the interest they’re making off of nearly free government bailouts. Just this week Hewlett-Packard fired its CEO, but is still paying him a bonus of millions of dollars in exchange for a year of corporate wandering in the wilderness. Netflix’s CEO cost his company hundreds of thousands of subscribers and had to reverse his decision. Bank of America’s CEO launched a debit-card fee plan that was immediately stupid in the eyes of many, but greed an arrogance led him to think he could pass it by his customers, and he lost customers in droves and had to reverse his decision, as did the many major banks that followed him. Since these corporate leaders do things most of us can immediately see as being dumb, why are they rewarded with salaries a thousand times greater than many of us make?