Market manipulators adjust the strategy to match with current market dynamics. The main strategy remains selling. However, instead of a massive selling to create panic in the market, market manipulators are selling repeatedly in smaller increments to ensure that day traders and speculators are following to create a trend to push down market for extended period of time to provide enough spread to take profit. As a result, market remains depressed for several days and there is still no short covering rebound yet.
Market participants are watching closely on the next move of market manipulators who make the largest profit while others are mostly suffering loss from the market sell-offs. Although many days traders and speculators are following closely on the selling, market manipulators are more cautious than before and open far less positions than before. As year end is approaching, it would be better to protect the profit and be less aggressive. On the other hand, market participants are looking to catch up and become more aggressive.
It appears that there may be headwind in the market as the risk appetite of investors are increasing and the flow of hot capital creates turbulance in asset markets.
Hanging on to Home, Even After a Fall
BERNIE AND JOYCE MURPHY are still convinced that they did everything right when they bought their home. And by all indications, they did.
Four years ago, the couple, who have been married 41 years, moved from a small town in Ohio to Stallings, N.C., just outside Charlotte. Mr. Murphy, 65, was retiring and they wanted to be near one of their sons and his family. They saved up, put 5 percent down on a $160,000 two-story townhome, got themselves a plain-vanilla 30-year mortgage and settled into a new life at the end of a quiet street. A small creek runs through the tree-lined development, where model homes have names like Riverbirch and Magnolia.
So what is it that is keeping the Murphys from walking away? Partly it is the morality issue: they promised to pay and they are able to pay, though not without some adjustments to their future financial plans. They also noted that they were not in the same dire straits as others in their neighborhood who walked away, including a young family of four that left in the dead of night some months ago. Mr. Murphy receives monthly pension payments after 22 years in state government in Ohio. He also gets Social Security benefits from 17 years of work at a private college, though those are reduced by Internal Revenue Service rules because of his pension.
“Don’t Get Too Bearish”: 5 Keys to the Market’s Next Move
After a third quarter of wild swings and a big rally in October, the stock market heads into the home stretch virtually unchanged for 2011.
Four key issues hold the key to whether 2011 ends up being the first down year since 2008 or whether the Santa Claus rally comes to town, according to Greg Zuckerman of The Wall Street Journal:
The Core of Europe: Now that Europe's debt crisis has moved from the "periphery", markets will take their cues from interest rates in Italy and France.
It's the Economy, Stupid: A big reason for the big rally in October was better-than-expected U.S. economic data. Many money managers were braced for an imminent "double-dip" and the positive surprises on GDP, employment, retail sales and other metrics helped account for the S&P's nearly 11% rise last month.
China's Landing: Whether China's economy has a 'hard' or 'soft' landing is the critical question on many investors' minds. As the world's second-largest economy and a major importer of myriad commodities, the outcome will have a major impact on financial markets worldwide.
As of Oct. 30, the average hedge fund was down nearly 3% for the year and underperforming the S&P 500, according to Hennessee Group.
Considering the fees being charged by hedge funds and the "reputational risk" of lagging mutual funds, Zuckerman notes underperforming money managers may be tempted to "chase" the market if it exhibits any signs of strength.
As a result, Zuckerman's conclusion is that investors should "not get too bearish" before year-end, even if there are plenty of things to worry about these days.
How to steal like Wall Street
On Wall Street, you gamble. You gamble big. But you gamble with other people’s money.
Borrow as much as you can. If it doesn’t work out, too bad — for someone else. Heads you win, tails they lose.
But reflect that the top 10 people at Bear Stearns and Lehman Brothers walked away with nearly $1 billion before those banks collapsed. A billion dollars. That money went to yachts and mansions and mink coats. The people who ran subprime firms like Countrywide Financial walked away with fortunes.
Reflect, too, that the bonus bonanza has been back on Wall Street for at least two years now.
Which brings us to “Occupy Wall Street,” and the protest movement.
America’s bankruptcy laws are crazy. You can shelter all sorts of money in things like 401(k) plans and still walk away. By the standards of the real, “moral” economy they are unconscionable.
Tackling Income Inequality
The Occupy Wall Street protesters have focused attention on rising income inequality in the United States, and they are right to do so.
Income and wealth disparities have reached levels not seen in the United States since the Roaring Twenties. And the concentration of income and wealth contributed to the speculative excesses that brought on the 2008 financial crisis (see Robert Reich's "Aftershock" and Raghuram Rajan's "Fault Lines").
According to a recent report by the Congressional Budget Office, rising income inequality is a long-term trend that began in the late 1970s and strengthened during the last two decades.
The top 1 percent's share of national income has also been rising in most other advanced industrial countries, but it is by far the largest and has grown the most in the United States (see Jacob Hacker and Paul Pierson's "Winner-Take-All Politics").
The top 0.1 percent earns about half of all capital gains, and such gains account for about 60 percent of the income of the top 400 taxpayers.
Large cuts in federal tax rates on capital and business income have been very beneficial to the top 1 percent over time.
As a result of these changes, along with President Bush's across-the-board cuts in income tax rates, federal taxes as a share of household income fell for the top 1 percent. Over all, the Bush tax cuts were the largest -- not only in dollar terms but also as a percentage of income -- for high-income households and increased the concentration of after-tax income at the top. Far from curbing escalating inequality, the Bush tax cuts exacerbated the problem.
A credible plan to reduce the long-run deficit requires a significant increase in revenue. Polls indicate that the majority of Americans, like the Wall Street protesters, believe that higher taxes on the rich are warranted both to reduce the deficit and to contain mounting inequality.
Restoring the top income tax rates and capital gains and dividends tax rates to their levels under President Clinton, as President Obama has repeatedly proposed, would be useful first steps. Taxing some carried interest as ordinary income would make the tax system more efficient and curtail outsize compensation in the financial sector. Adding a progressive consumption tax would augment revenue while encouraging saving and discouraging spending on luxury goods, both by the very rich and by those down the income ladder struggling to keep up.
The majority of Americans, like the Wall Street protesters, also believe the corporate tax rate should be raised.
Raising tax rates on capital gains and dividends to the levels under President Clinton would curb the growth of income for the top 1 percent and could finance a substantial cut in the corporate tax rate that would bolster wages and job opportunities for American workers.
U.S. Economy Growing at Fastest Pace of the Year
The U.S. economy may end 2011 growing at its fastest clip in 18 months as analysts increase their forecasts for the fourth quarter just a few months after a slowdown raised concern among investors.
Behind the revised fourth quarter forecasts: Consumers have not cut back on spending even with the turmoil in world financial markets, putting pressure on companies to rebuild inventories they ran down because of concerns about Europe.
Housing construction permits climbed last month to their highest level since March 2010, according to Commerce Department data, as the near record-low mortgage rates lured some buyers into the market.
The future pace of consumer spending ultimately will be decided by the growth of household income, which in turn is tied to the health of the job market.
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