* The PPT (Plunge Protection Team) is messing around in the stock market as usual. How long can this last? The banks are using their bailout monies to drive the market higher. The higher stock prices improve their balance sheet. Assets go up and their own share prices go up. This allows them to raise capital at a much higher price. It is always easier to raise capital from investors in a rising stock market.
* Bob Chapman remarks :
Since March we have watched a stock market rally borne by low volume and short covering. The gains are reminiscent of the rallies of 1930 and 1932. What you are witnessing is a rally engineered by our government. If you watch the tape and you can read it you can see exactly what they are doing, and how they are doing it. Yes, it is legal under an Executive Order singed by President Ronald Reagan in the aftermath of the October 19th, 1997 collapse of the stock market. It was named the “Working Group on Financial Markets” and was to be used for such emergencies. Unfortunately, like many things in government, the mission of the “Plunge Protection Team” has been distorted. For over the last more than ten years it has been used to manipulate markets 24/7. Thus, what you are witnessing is a sucker rally, which has little hope of lasting. What do you do with a market that has a trailing P/E of 24 times earnings? You stay as far away from it as possible.
Now that the stimulus has exhausted itself consumption is falling more rapidly, bills are being paid off and many have taken to saving again. If consumption cannot hold its own or increase during a large stimulus, when can it then? In other words how bad would the drop in GDP been if there had been no stimulus?
* There are only so many suckers in this stock market rally. Sooner or later people will catch on to the con job and it is bye bye! Graham Summers writes :
Through this year and the last, the last 30 minutes of trading has been a critical point for manipulation. Countless times the market has shown signs of breaking below critical resistance points, only to have stocks rally sharply in the final 30 minutes of trading. Indeed, there were even several days in which stocks actually reversed losses to close at a gain all in the final 10 minutes.
This is not coincidence.
As I’ve noted countless times on these pages, this market is being manipulated… HEAVILY. And these last minute rallies have come at the hands of JP Morgan, Goldman Sachs, and other large Wall Street firms. I know personally of at least two instances in the last two weeks in which JP Morgan stepped in and bought 1,000 S&P 500 futures at critical points, pushing the market higher just when it looked about to break-down.
….. Stocks staged late day rallies on August 6th, 10th, 11th, 13th, 14th, and 17th (that’s only the last two weeks!) The most critical rallies came on the 10th and 11th. Without those, the S&P 500 clearly was heading for 980 in a very rapid fashion.
It’s important to note that this late day manipulation can only last as long as there are equity bulls who believe in it. That is, buying a ton of futures only kicks off a rally in stocks if there are enough stock bulls who believe that someone in the futures market knows something they don’t. Much like in poker, you can only run the table when you’ve got a patsy or two to pony up the cash.
And the stock market ran out of patsies last week.
…. traders shot for late day rallies on both the 17th and the 18th (yesterday). Both days, they failed to get enough bulls to buy into the manipulation (stocks rolled over in the final minutes). They did manage to stage a major rally at the end of the week, thanks largely to options expiration and Bailout Ben pumping $46 billion into the system. However, now with options expiration out the way… and in light of today’s turnaround to the downside, I’d argue that:
1. The bulls are out of steam.
2. Reality is taking hold.
Stocks are SEVERELY overbought now. And yesterday’s turn-around collapse looks to be a herald of things to come. I wouldn’t be surprised to see the S&P 500 back at 980 very shortly.
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Source: http://socioecohistory.wordpress.com/2009/08/27/manipulated-stock-market-watch-the-last-30-minutes-of-trading/ 
