Dead-man walking stock markets

[power]

A "massive fraud" is going on in the stock markets.

Big players are manipulating the stock markets. These big players are investing their own "rich profits" earned over the years to keep the stock markets alive. By now DOW Jones should have reached 4000. Who is investing money in stock markets when all the giant banks and companies are bankrupt and suffering massive losses?

If the stock markets shut down, big players will be bankrupt and begging on the streets.

Big players and governments are allies for "dead-man walking stock markets"

The stock markets had died 3 months back when Giant banks and Giant companies became bankrupt and received Trillion dollars bail-out because Bankrupt companies do not survive for long. They will shut down.

[acptulsa]

Every publicly held corporation is traded somewhere. Not every corporation is a dead man walking, though many a big name are. The Dilbertian nightmares are crumbling, and this is long overdue. If it weren't for government, companies so mismanaged that they become Dilbertian would collapse sooner than they do. But there are publicly held companies out there quietly surviving, and the people have the right to trade their stocks.

Yeah, it would be nice if every unethical broker who stuck the elderly in crap were to be broken themselves. In any case, though, business still needs to be conducted. Would be nice to be down to those businesses that conduct business, as Daschiell Hammett said, 'in a businesslike manner'. But in any case, the NYSE still has a place in the world...

We need to be careful of oversimplification. The reality of the world is that such broad brushes won't paint you an accurate picture of the situation.

That's why I didn't vote in this poll. The answer is both. The trick now is to tell which will survive and buy them cheap.

[slacker921]

There are loads of people putting money back into the market because they see this as "the bottom".
There is a lot of money still sloshing around in mutual funds via 401ks that is still trying to prevent further losses and find "bargains" for long term growth. The mutual fund managers were stupid enough to lose 40%+ of the fund last year and now they're buying into the banks.

[power]

The mutual fund managers were stupid enough to lose 40%+ of the fund last year and now they're buying into the banks.
Mutual funds are the Mother and Father of stock markets. They manipulate the stock markets as per their will. Mutual funds are keeping the stock markets alive for their own survival. They make people dream of "rich profits" after 5 years. But nobody can see future.

AIG suffered $62 billion loss. GM suffered massive loss & will shut down next month, USA private sector lost 697,000 jobs in February. Where will the profits and dividends come from?

USA debts/deficit has reached $65 Trillion. Barack Obama will be removed from president's office anytime. There is no future guarantee and stability.

[Ethek]

Its walking dead alright.. but its going to like a deer hightailing off into the wilderness with a mortal wound. A hard rally is coming, in my limited and h o. It will still get to 4000, just not soon.

[power]

At the heart of the difference is the distinction between realized and unrealized gains. Gains are realized when assets are liquidated to cash. For instance, if you buy a stock for $100 and it is currently trading at $200, you have made $100 in unrealized gains. If you sell it at $200, you have made $100 in realized gains. Most hedge funds do not regularly liquidate their entire portfolio, so they report unrealized gains to their investors and to the public.

Even in the most vanilla of trades, liquidation can impact the market price. With lightly traded securities, this can be magnified. For example, a fund might corner some asset by buying and buying and buying and then reporting a huge unrealized gain. But the moment the fund tries to sell and realize the gain (perhaps to pay off its last few investors), demand disappears, and the asset crashes. Again, investors withdrawing early got better returns over that time period than those who waited until later. (See the top 10 financial collapses of 2008.)

If hedge funds had to regularly liquidate assets, we would not see the spectacular returns reported in the past. One factor of the supposed success of hedge funds is their ability to report unrealized gains and to be flexible in liquidation, since investors who believe they are getting high returns are unlikely to withdraw their money. That was how Madoff was able to maintain his charade for so long.

Hedge funds are designed to take in more and more investors' money. Then inefficiencies and performance distortions of withdrawing money for investors and profit-taking for managers are smoothed out. The recent failures in hedge funds, while rooted in the financial meltdown, have been further fueled by the lack of new investment as well as pressure from current investors to take their money and run. Regardless of a fund's investment strategy, liquidation tends to make unrealized gains smaller — and unrealized losses larger — when they are finally realized.

By design, hedge funds benefit managers more than investors. Since the liquidation of assets always results in slippage — the more that is sold, the worse the price — managers for every hedge fund always get the "best" 20% of the profit.

As per above statement, Stock Markets and Mutual funds are "Biggest Ponzis" because stocks & Mutual funds also display Unrealized profits and unrealized losses.

The whole article from 'Time magazine' is based on "unrealized gains".

Stock markets always displays "unrealized gains" which attracts new investors.

But the moment the investor tries to sell and realize the gain, demand disappears, and the asset crashes. Again, investors withdrawing early get better returns over that time period than those who waited until later.

http://www.time.com/time/business/article/0,8599,1869196,00.html

[icon124]

Um...

the people who sold anywhere when the market was between 11k and 13k are getting back in right now.

It's examples like that....not the evil PPT controlling the world.

[power]

Um...

the people who sold anywhere when the market was between 11k and 13k are getting back in right now.

It's examples like that....not the evil PPT controlling the world.

I sold all my shares/stocks some 6 months back and earned excellent high profits. Now I will never invest in stock markets because now I know "massive frauds and manipulation" goes in the stock markets.

Giant banks and companies are bankrupt. There will be no profits for them for next 2 to 4 years. So forget dividends. There is no real money just ponzi schemes.

The World is heading towards World war III.

[power]

Big players and governments are allies for "dead-man walking stock markets"

The stock markets had died 3 months back when Giant banks and Giant companies became bankrupt and received Trillion dollars bail-out because Bankrupt companies do not survive for long. They will shut down.

It does not matter how hard you try to preserve a dead human body but the body decomposes (example ancient mummies).

Similarly it does not matter how hard the governments and big players try to preserve dead stock markets, they will decompose.