Shaking the Market for a Crash
Maybe I'm just tired and cranky right now, but is it apparent to anybody else that the high frequency traders and hedgies are deliberately trying to shake the markets enough to cause a devastating crash??? Is it more than interesting and a lot disconcerting that there are ads on TV now for newsletters and services on how to prepare for the end of America as we know it?
Maybe I am wrong, but it seems to me that the violent whipsawing in the market the past couple months has nothing to do with retail investors trading. For the most part, either they are in or out at this point. It has little to do with Investment Advisors either, who might be making a half dozen trades a week, and really most are making far fewer that that. There are far fewer retail brokers out there than even a few years ago, so I don't think it's them either. I review MMFAIS with some regularity and the institutions are adding or subtracting at what appears to be about normal rates.
That really only leaves the HFTers and hedge fund guys as the folks moving the market around. Are they doing it to squeeze out small profit after small profit? Is there something more to it? Maybe each one has their own motive? Are there hedgies just waiting until they can get enough speed on the swing to flip somebody into the dirt for a header, that somebody being everybody else? My guess is somewhere in those ideas is the truth.
I don't know for sure, but something does not smell right. Do we really have better regulation now or are there just different rules to break that make the rule breakers even harder to pin down?
What I know is that the markets are being moved- dare I say manipulated- with no good intentions for humanity as a whole. Is greed really good if this is what it has become? Does the SEC have a role here? If they do have a role, will they do it before a crash actually occurs and boomers are forced to work another five years?
Again, I am really not sure, I just know something is wrong that probably shouldn't be.
So, what to think and do.
Well, like I have said, I don't really know exactly what to think, but I'm going with there is a lot of cheating and manipulation in the markets right now preying on fear- some rational, some irrational.
I'm 30% in cash, have a small crash hedge via a put on the S&P I own and otherwise am holding onto a lot of losers right now. I'm looking for great buy and hold opportunities. But boy oh boy is that tough to do with the threat, real at least in my mind due to the above reasons or at least perceived reasons, of crash. Knowing what a low price is right now has certainly gotten much tougher.
Sigh, maybe it is time to pull out some Buffett wisdom.
"I never attempt to make money on the stock market. I buy on the assumption that they could close the market the next day and not reopen it for five years."
Yeah, that makes me feel better. I bet my losers right now are winners in five years so long as I leave them in the drawer and wait.