Monday, January 11, 2010

The Public Gets Wise to the Wall Street Flacks!

"That we Americans allot the richest rewards of our economy to speculators, is a question of mores; that we allow one-sixth of our fellow citizens to be ill-housed, ill-clad, and ill-nourished is a question of morals. That we shrink from our problems instead of attacking them with eagerness, generosity and hope is a question of morale. The questions are obviously interrelated."

- George P. Brockway, in 'The End of Economic Man - Principles of Any Future Economics', p. 86.

In the previous instalments, I examined the massive propaganda industry at work in the United States, which seeks to manipulate the minds of citizens on every front, from how to get them to overlook chemical toxins in the environment (as the main cause of their cancers), to overlooking the political toxin of the JFK assassination - which has left a corrosive effect on governance for the past 40-odd years. This latter has occurred primarily as a result of the expedient act by the media and power centers, to hide the truth of the assassination, rather than allow it to come to light and purify the nation.

While the success of PR and propaganda on multiple fronts has been dismaying - especially (over the past decade) in the siren call to buy, buy, buy and thereby prop up the national GDP (70% of GDP is currently supported by consumption) there are a few fronts wherein success is coming, if only slowly. One of these is the pullback of many small individual investors from the stock market snail oil salesmen.

For decades, as we know, small investors have had to contend with having this dreck about being "in the stock market" thrust into their eyes and faces, and yammered at them over the tube by some overpaid, hack blowhard. The key meme is that if you don't own stocks, or their equity cousins in mutual funds, you will lose in retirement and won't make up for inflation. Of course, this is a pack of recycled horse pockey.

A perfect and much saner alternative to gambling in the volatile -bubble prone stock market is simply to save, save and save....and use quantized chunks of that savings to generate streams of steady incomes via laddered immediate fixed annuities. But hardly anyone mentions this! Why? Because a steady stream of deluded, pie-eyed dupes is needed to continually keep stocks and mutuals primed for the big boys to get rich. Indeed, some years ago - in assorted issues of The Wall Street Journal- articles appeared wherein traders actually referred to "chickens to be plucked" and "dumb order flow" - referencing the little guy investors.

Why the disdain? Easy to grasp if you grok the basic Wall Street pyramid game. Pundits, wags and paid media whores hype the various stocks, funds or instigate a "buzz" about them - to get suckers to buy in. The increasing buy- in inflates the price-to -earnings ratio (P-E ratio) and produces a bubble of high profits. The "Big boys" (large, institutional investors) get tipped 1-2 days in advance and cash out, leaving the little guys to sink. If they're lucky they may earn a few bucks. Not much. The thievery works eventually because most manjacks are conditioned to "buy and hold" rather than fold when the share price dives below a certain threshold. (Which ought to be the tip off). Thus, there are always ample marks left at the end game to be properly fleeced. Amazingly, they're always ready to play the game again, and pile their newly saved up money in.

Look at the dopes.....errrr....dupes, that got creamed in the dot com bust, then came back to plow money into the next "Bull" - only to have their pockets and 401ks emptied again (with the post 9-11 bust). Now, having to work years longer. Oh wait, now decades longer maybe....after the 2008 housing market and massive cratering of the stock market. (No wonder AARP and others keep hyping the need for people to "work past 65"...Yeah right, if longevity runs in the family!)

Anyway, the finance media have been unrelenting in attempting to entice people to buy in, especially to this latest Bull run, which I have already written about- pointing out it's based on economic phantasms: mostly stimulus money to buy shares and jerk up share prices artificially, and high risk hedge fund hedging, combined with the Fed's ridiculolusly low interest rates which is fueling the "grab the free money now" binge.

But the good News! Joe and Mary Citizen aren't biting! According to an AP release in the finance pages of dozens of dailies on January 9, small investors aren't buying the bull of this next Bull. This - according to the article may "mean the little guy is right in shunning the market now, and it's the experts who are wrong".

According to David Rosenberg, chief economist at Toronto money manager Gluskun Sheff:

"People have been lured into two bubbles seven years apart, and for a lot of them, it's over. The bulls say if the market is up this much without retail investors just watch when they come in, but it isn't going to happen".

Indeed, but that won't stop the market cheerleaders and other wags (especially on the cable business channels) from using whatever perverse PR and bunkum they can, to try to drive more marks into this market. ....pump it up for the big institutional investors, then be creamed when the bubble is punctured, as it will be. As I said several times before, there is nothing REAL to support this irrational exuberance. The jobs monthly reports continue to show employers not hiring, and if people aren't hired (already over 22 million are not working - and no I don't used the propagandized BLS stats which drop people off unemployment rolls beyond 6 months not working!) they can't make discretionary purchases. If they can't have that, then companies bottom lines must suffer, and their shares must dive - there is nothing REAL to support growth,....duh...

Wait, I take that back. Stimulus money is now supporting a lot of that growth. But it is up in the air whether another infusion of stimulus cash is forthcoming, so the party has to end sometime. A serious financial journalist I heard on BBC America the other night, estimated at least ELEVEN YEARS before jobs return to their pre-2008 market meltdown numbers...if then! That's a long time to be holding stocks, or mutual equities...hoping the "rainbow" lasts long enough to support your retirement!

So, what I am hoping is that - at least in the realm of financial propaganda- people (CITIZENS) have finally seen the light and won't buy in again no matter how the siren calls are directed, or twisted.

We must finally cease to have false consciousness embedded in our minds, forcing us into being the slaves of the elites who seek to manipulate us! The first step is to tell the hacks in the finance realm to put a sock in it. We will no longer allow their spiels to entice us into supporting shysters with our hard earned bucks!

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