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Why Banks Will Cut Stock Market Fuel Supply

Discussion in 'Topical Discussions (In Depth)' started by BarnacleBob, Feb 11, 2018.



  1. BarnacleBob

    BarnacleBob GIM Founding Member & Mod. Founding Member Site Mgr Site Supporter

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  2. BarnacleBob

    BarnacleBob GIM Founding Member & Mod. Founding Member Site Mgr Site Supporter

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    Margin calls can trigger a downward selling spiral

    https://www.mercurynews.com/2007/08/18/margin-calls-can-trigger-a-downward-selling-spiral/

    Article is from August 2007. Note the howling error on the last line. Just how many investors out there are ignorant of how money works? Margin cash was 53.72% of the money supply used to trade shares in the 2007 peak. Not "1.94 percent" as if there was cash to liquidate the entire NYSE market cap.
    Even the discontinued super-broad M3 measure of money stood at only $10,366 Billion in March 2006. The corresponding NYSE Cap was $15,485 Billion, $5,119 Billion more, or 49.4% above the theoretical money supply. Let's leave aside the fact that the vast majority of that money wasn't "in broker accounts."
    [and being pedantic here, even if the money did exist in the market, the money traded in the NYSE would have been 2.07% debt not 1.94%, at the 07 market peak, as those numbers I put on my website show]

    https://www.themaven.net/mishtalk/a...selling-spiral-article-gWW5Rg4whk2qsWzsufkUXQ
     
  3. BarnacleBob

    BarnacleBob GIM Founding Member & Mod. Founding Member Site Mgr Site Supporter

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    The things in this document will sound very strange to you if you aren't in on all the dirty secrets of how our global banking monetary system works.
    The long and short of it is that we as a society treat IOUs from commercial banks as if they were those same meaningless IOU bearer notes from the central bank.
    Because of this, commercial banks can bring unlimited sums of money (their IOUs) into existence.
    However, these IOUs, that is, this money, is exstinguished when it is "payed back" to the bank.
    If you come to own your IOU, obviously that's now meaningless. To coin a new phrase: you don't owe yourself anything.

    http://rayner-hilles.com/
     
  4. EO 11110

    EO 11110 He Hate Me Mother Lode

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    seems that anytime labor gets a little bargaining power (low unemployment, wage 'pressure') the parasites in nyc raise rates and crash the thing --- resulting in layoffs, bankruptcies, etc. throwing millions out of their jobs.

    thus wage 'pressure' solved. parasites back in total control of hoovering up all of the productivity gains into their cayman accounts
     
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