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Quadruple Witching Friday: Stocks slipping, Fed embarrassed

Written By | Sep 17, 2021
quadruple witching Friday, pre Easter rally, bullish, inconclusive, dazed and confused, Dow rallies, trade war

Cartoon, “Wall Street bubbles – Always the same.” American financier J. P. Morgan is depicted as a bull, blowing soap bubbles for eager investors. Several of the bubbles are labeled, “Inflated values.” Public domain image from US Library of Congress (LOC) via Wikipedia entry and caption under “Market Trend.”

WASHINGTON – As they have pretty much all week, stocks continued to tank Friday, although they’re attempting some kind of feeble recovery as we approach the 3 p.m. hour. While we watch stocks slipping, we also see bonds wobbling, though they remain slightly positive. But we also we see a Fed embarrassed by its own legal but questionable personal investing activities. I had hoped that when the madness surrounding our latest Quadruple Witching Friday options and futures betting more or less concluded at 2 p.m. today, we’d find a bit of room for green ink as the current miserable trading week comes to a close. But no. No such luck. All three major averages are off, from -0.5% (Dow) to -0.9% (S&P) to the consistently awful, tech-centric NASDAQ, which is currently down about 1.06%.

Beyond Quadruple Witching Friday

All of which means that whatever stock you hold, they’re likely down. Again. This is typical of the 6-8 week period coinciding with September-October each year. But it’s not encouraging right now, given the rapid but largely unreported unraveling of Washington’s fake, junta-controlled ruling class stab at using a cipher-president to front the rest of Barack Obama’s Marxist “fundamental transformation” of America.

That doesn’t seem to be working too well right now, and it’s making Mr Market very, very nervous.

One reason (beyond today’s typical Quadruple Witching Friday nonsense) why we’re seeing stocks slipping and bonds wobbling today is a surprising yet unsurprising bit of news that leaked out today on the investing habits of at least 3 Fed officials, including Fed Chair Jerome Powell.

Also Read: Dazed and Confused: US stocks wander under Biden Administration

Did Chairman Powell and his fellow pals at the Fed do a little “insider trading”?

CNBC reports the critical details. We quote this at length. But read the linked article for even more details. (Bolded text by this writer.)

“Amid an outcry about Federal Reserve officials owning and trading individual securities, an in-depth look by CNBC at officials’ financial disclosures found three who last year held assets of the same type the Fed itself was buying, including Chairman Jerome Powell.

“None of these holdings or transactions appeared to violate the Fed’s code of conduct. But they raise further questions about the Fed’s conflict of interest policies and the oversight of central bank officials.”

Gosh, if you or I did something like this in the private sector, wouldn’t that be “insider trading”? And wouldn’t we be in jail by now? But I digress… let’s continue.

More on Fed fun

“Powell held between $1.25 million and $2.5 million of municipal bonds in family trusts over which he is said to have no control. They were just a small portion of his total reported assets. While the bonds were purchased before 2019, they were held while the Fed last year bought more than $5 billion in munis, including one from the state of Illinois purchased by his family trust in 2016.

And even more

“Boston Fed President Eric Rosengren held between $151,000 and $800,000 worth of real estate investment trusts that owned mortgage-backed securities. He made as many as 37 separate trades in the four REITS while the Fed purchased almost $700 billion in MBS.

“Richmond Fed President Thomas Barkin held $1.35 million to $3 million in individual corporate bonds purchased before 2020. They include bonds of Pepsi, Home Depot and Eli Lilly. The Fed last year opened a corporate bond-buying facility and purchased $46.5 billion of corporate bonds.”

Now we know the secret behind the massive wealth of government officials. (Actually, we probably always knew.)

Awesome. Ever wonder how politicians and top Federal government officials go into government as relatively normal people and come out as multi-millionaires. This is how.

It’s even worse than it looks, according to Michael Every of Netherlands-based Rabobank.

The bank, according to already left-wing Wikipedia is “a Dutch multinational banking and financial services company headquartered in Utrecht, Netherlands. It is a global leader in food and agriculture financing and sustainability-oriented banking.”

In other words, this is a bank run by another batch of bleeding heart Green Meanies. Nonetheless, some of their observations, like Every’s here, routinely address some serious points. Again we quote at length. But read the whole thing.

Rabobank weighs in on corruption

“Regular readers will know I am a cynic. Try writing a Daily for over two decades and not be – and events over the last 24 hours underline that fact. Indeed, you could call it a ‘Salò News Day’ in reference to the controversial Italian film ‘Salò, or the 120 Days of Sodom’, a loose adaptation of the 1785 novel by the Marquis de Sade. As Wikipedia puts it: ‘The film explores themes of political corruption, consumerism, authoritarianism, nihilism, morality, capitalism, totalitarianism, sadism, sexuality, and fascism.’ In other words, a typical day at work in the markets of 2021.”

Every forgot to mention Marxism, socialism, and their unified field theory, aka “globalism.” But let’s continue…

More from today’s “120 Days of Sodom” practitioners

“After all, the Wall Street Journal reports ‘World Bank Cancels Flagship “Doing Business” Report After Investigation’, frustrating to economists who rely on it. The rub is: ‘Chinese officials in 2018 were eager to see their ranking improve, and so Mr. Kim and Ms. Georgieva and their staff held a series of meetings to discuss ways that the report’s methodology could be altered to improve China’s rankings.’ So untrustworthy World Bank data – and no consequences; a World Bank boss with a stained reputation – and no consequences; and an IMF boss with a stained reputation – and no consequences. That makes it two in a row for the IMF, with the previous one now running the ECB.

“At the Fed, ‘Powell orders ethics review after Fed presidents disclosed multimillion-dollar investments’. Somehow this ethical violation on the part of the people running the global financial system passed them by until now. Yet is this really rare? How about if a rate-setter at a central bank told you over lunch about the land their company was snapping up for development? That happens – just not at the Fed. (As far as I know.)”

Back to our regularly scheduled programming

Yeah. It happens everywhere. But nobody gets called on it, and the participants in this jolly, floating crap game were also the ones who ultimately caused the Great Recession earlier in this century.

As in, how many “perp walks” did we see for that one. I’d guess that only true revolutionaries and seditionists, like those January 6 unfortunates currently rotting in jail (without evidence). The Ivy League perps who wreck our perfectly good economic systems, the ones who manage to loot as much as they can before each given sector collapses, always manage to walk free.

This is the kind of stuff that destroys the average citizen’s confidence in the integrity of government, financial systems, and, of course, medical and scientific agencies and systems as well, in case anti-vaxxers, anti-maskers haven’t noticed that either.

The depressingly steady drip of Greed and Evil

When evidence like this dribbles out – evidence of grifting and grafting that is somehow legal while supporting a actual winning presidential candidate is not – continues to sap confidence in government, in science, in business, and ultimately in stocks – the last available way the unwashed can at least get hold of a fraction of the booty that the real government and business pirates in D.C. and New York routinely haul away.

The real reason, beyond Quadruple Witching Friday, that’s behind stocks slipping and bonds looking iffy

And so we approach what might be the fall of our discontent, as what integrity that remained in our governmental and financial systems suffers another blow to its alleged sagacity and pro-consumer orientation.

I’m convinced that this lack of integrity, this rot is severely undermining the support that thus far has sustained what’s left of the Trump Bull Market. But watching stocks plunge again this week, I can’t help but feel that this is yet another consequence of “fundamental transformation.”

When we see stocks slipping, should we be bailing?

It seems that everyone with big bucks has been bailing on this bull for weeks. The rest of us still holding on to perhaps too many stocks right now, might wish to seriously consider following these overly-wealthy and sinister Wall Street “Whales” and other associated bankers and miscreants out the door before we get left holding the back.

Our positions are approaching 50% cash right now. That cash makes no money in this environment. But then again we’re not losing any right now. And for a short period of time, at least, maybe this is the way to go. Before we have to endure the next Quadruple Witching Friday this coming December.



Terry Ponick

Biographical Note: Dateline Award-winning music and theater critic for The Connection Newspapers and the Reston-Fairfax Times, Terry was the music critic for the Washington Times print edition (1994-2010) and online Communities (2010-2014). Since 2014, he has been the Senior Business and Entertainment Editor for Communities Digital News (CDN). A former stockbroker and a writer and editor with many interests, he served as editor under contract from the White House Office of Science and Technology Policy (OSTP) and continues to write on science and business topics. He is a graduate of Georgetown University (BA, MA) and the University of South Carolina where he was awarded a Ph.D. in English and American Literature and co-founded one of the earliest Writing Labs in the country. Twitter: @terryp17