One Chart: Stock Market is Rigged

The stock market is completely rigged! The Dow, S&P 500 and NASDAQ are completely different sets of stocks. In a truly free market where stocks are traded on fundamentals, there will be absolutely no correlation between these three. But in our rigged world, they move like synchronous swimming competition in the Olympics. Here is a chart from today:

Stock Market -3

Can this be a one-time rigging? Here are two charts – performances of these indices for the last 3 months and 5 years – that should put that optimism to rest:

stock market rigged -4

 

stock market rigged -2

Good luck to those people who keep investing, especially long term in 401K, IRA etc. You are just handing over your money to the crooks!

6 comments

  1. Interesting thought, but consider that each index is made up of multiple companies in a broad range of sectors and that their movements are more indicative of the health of the economy as a whole (that is until recently when stocks became divorced from reality). Is there a bit of rigging/manipulation? Sure there is. But to say that the entire system is meant simply to transfer wealth to the already wealthy just doesn’t hold water. The retirement accounts of hundreds of millions of people rely on the equities and bond markets, and many people have been able to successfully retire on those investment gains.

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    1. The stocks in those three indices are very different, especially if you consider the most weighted stocks. For example, the top ones in S&P 500 are FANG (Facebook, Amazon, Netflix, Google) tech stocks; while Dow has Goldman Sachs, 3M, Boeing, Home Depot and McDonald.

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      1. I get that each contain different stocks in mostly different industries. But what I’m saying is that just because they move in correlation to each other doesn’t necessarily mean the market is completely rigged. When you take a broad section of any industry, it’s price moves are going to be very in sync with the economy as a whole. Look at when the 2008 downturn happened, everything suffered because a global contraction in credit so a lot of stocks and equities and commodities lost a lot of their value for that reason alone.

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      2. When there is a huge swing, obviously all indices swing in the same direction. But when you see precise correlation day in and day out where every up-tick and down-tick are matched, you know what’s happening.

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