Stocks get pummeled again Friday. Plunge Protection Team intervenes
WASHINGTON – As Wall Street finally wrapped up its final trading week in a treacherous February, traders and investors breathed a tentative sigh of relief that the month was over. After all, the vicious, all-sector stock market crash continued unabated Friday as we watched already bloody stocks get pummeled again. Until roughly the final 20 minutes or so of trading action. Down all day, the Dow was hovering roughly between -750 and -1000 or more. But then, the Good Fairy — aka, the highly secretive Plunge Protection Team (PPT) — quietly arrived on the scene to stage an intervention. In moments the Team rallied the Dow Industrials to close down “only” – 357.28 points, a mere 1.39% loss on the day.
Today, CDN offers a 4-part series that attempts to unravel the mysteries surrounding Mr Market’s current, sickening crash: its gestation, its apparently sudden intensity, its vast ripple effects and the part stocks and the economy play in the Socialists’ obsessive and never-ending scheme to Dump Trump and “fundamentally transform” America into yet another failed, one-party state.
Plunge Protection Team rides in to save the day. Sort of…
As we neared the 4 p.m. closing bell on Friday, the broader-based S&P 500 was off “only” 24.54 points for a less than 1% loss. And the tech heavy NASDAQ offered investors a pleasant surprised. Viciously pummeled all week due to fears that the badly damaged Chinese supply chain would starve the world of tech parts and products, the NAZZ actually closed UP 0.89 points for a 0.01% gain. A pretty nifty job, all in all, for the unknown members of the Plunge Protection Team, who have frequently rivaled the equally mysterious Gnomes of Zurich who likely helped contribute to Friday’s amazing almost-save.
At any rate, after last week’s gut-churning action, most folks still holding common stocks will take that measly 0.01% gain. It’s better than the bloodbath these stocks suffered for the entire week.
Coronavirus: A key but relatively fake political excuse for Mr Market’s recent beating
Just as we heard “Russia, Russia, Russia” for two years until the Mueller Gang’s nothingburger report came out, we’re now hearing “coronavirus, coronavirus, coronavirus” from the Democrats and their media lackeys, attempting to link President Trump with anything and everything that may or may not have anything to do with the coronavirus scare. The objective, as it was with the Russia hoax and the impeachment hoax, is to defeat Donald Trump this November since the opposition failed utterly in getting him to resign or to throw him out of office. That’s why the media is mercilessly flogging the coronavirus angle.
For both the media and their Democrat clients, the coronavirus scare comes at a fortuitous time, offering a follow-on narrative to tar the president with the negativity surrounding this potentially disastrous “novel coronavirus.” Having failed in their attempt to impeach Trump, are now grasping at the coronavirus straws, hoping that mass casualties and death will derail Trump’s economic miracle and lead to a resounding GOP defeat in November.
Mr Market is highly susceptible to rumors and scare stories even in the best of times. But the current, apparently coronavirus scare merely gave traders and investors a great excuse to unload massive chunks of their gain-laden portfolios. By the end of January, stocks appeared way ahead of themselves price-wise. I.e., stocks were in an “overbought” situation. Historically, in such situations, stocks are ripe for a “correction” of minus 10 percent or even much more. The coronavirus scare merely served as the catalyst investors needed to head for the exits. Which they did last week with a vengeance. Corrections tend to “retrace” much of the earlier gain as they restore some reality to the pricing of stocks.
From overbought to oversold – with a little help from the #NeverTrump brigade
Unfortunately, some corrections get entirely out of hand and can create an equal and opposite “oversold” situation on the downside. In this century, such declines can quickly turn vicious.
By mid-February, nervous investors and underemployed high-speed trading machines needed a catalyst for such a sharp decline to happen. And they got that catalyst with the current coronavirus scare.
But they got something more: Another opportunity to scare the US economy into the recession The Swamp and their media acolytes have been trying to cause for a year now, the better to create an atmosphere for Trump’s defeat. A staggering, zombie economy is certainly one way to do it. So the denizens of The Swamp and its media Amen Corner proceeded to scare Americans – and Mr Market – to death.
The result? BOOM! A big crash on Wall Street, now slightly longer than a normal trading week in duration and with few signs that it will cease anytime soon.
Why stocks get pummeled: Rounding up the usual suspects for the current Nightmare on Wall Street
But as this horrible week staggered on, this skeptical columnist noted a number of other online columnists were also sniffing out the evidence of the latest, desperation-move, anti-Trump scam. Online columnists like PJ Media’s Victoria Taft.
“Wall Street seems to be filled with Nancy Boys, swells, head-cases and drama queens. With every whiff of a problem, they sell off to beat a possible rush – thus creating a rush. There are very few people around like those who tried to blow the whistle in ‘The Big Short,’ for example.
“With the Left and their buddies in the media hoping for a crash in the market to douse President Trump’s unrivaled economic prosperity leading up to the election, you can’t really trust the mainstream media to tell you the truth. They almost always over-inflate the importance of everything – especially if it could be twisted to make Trump look bad.
“With Jim Acosta telling you the story, could you hope to get a fair treatment of the president and the coronavirus?”
A word from Wretchard the Cat
Likewise, “Wretchard the Cat,” the brilliant but relatively unsung Richard Fernandez (also posting on PJ Media) weighed in with a tweet that seems to flow naturally from Taft’s observations.
A lot of the fear comes directly from the loss of trust in institutions. The press, WHO, the official authorities are no longer implicitly believed by everyone. This is the cost of deceit. When you finally tell the truth your cred is gone.
— wretchardthecat (@wretchardthecat) February 27, 2020
Is the Plunge Protection Team getting ready to surprise the Bears?
Rumors have been gathering since last Thursday at least that the Fed and the PPT, along with the Gnomes of Zurich, several mega-banks and, perhaps, the Eurobank as well, may indeed mount some kind of intervention, perhaps as early as Sunday evening. We’ll have to wait and see on that. And perhaps by the action – or non-action – that may unfold this week, we’ll get to see whether President Trump has the upper hand in this latest fiscal mess, or if the Deep State finally has a method to re-assert the control they once had during the eight, long, unproductive years of Barack Obama’s Socialist administration.