Wall Street: The Stupidest People on Earth

What else can you call people who solemnly talked about the "necessity" of the Paulson "plan" for the government to purchase "toxic assets", only to have Paulson abandon that plan? What else can you call people who talk about Paulson--one of those stupid Wall Street people himself--as the "smartest person in the room", when he basically ruined Goldman Sachs (even if it was not obvious when he left), lruined the economy with his panic (and lack of previous leadership), and shows he has no clue at every turn? See Wednesday's entries.


But it is this blog, as usual, which has told you that the emperor has no clothes. This is aboutt he 5th entry about how stupid you have to be to be a stock trader who continues to purchase or sell stocks after the market indexes are already up 200 Dow points or down 200 Dow points. I have been proven right every time. Yes, I told you that the recent Dow rises of almost 1,000 points in single days were fiction. I have told you the same thing about short term major losses.

Yes, I am smarter than Rush Limbaugh, or let partisanship rule what I say less. Limbaugh, and some other conservatives, have been talking about how the stock market has been going down because of Obama, since his election. That is absurd (although stock traders don't delude themselves that Obama is a "savior").

The market went down for the reason this blog told you it would go down: the up move before the election was not real "investing", but computer, momentum trading as the "smart guys" treat the stock market like a video/computer game. These short term market moves have almost nothing to do with any fundamental events, and everything to do with these computer/gaming moves within the "range" that the market has traded ever since the false Congressional debate over the "bailout plan" that never happened.

Yes, it happened again yesterday. The Dow had one of those fictional 500 point moves (not just in a day, but in an hour or two, and a move that was considerably more from low to high).

I ask again: how stupid do you have to be to continue to buy stocks when you know that you are buying at a short term high, and that they are headed back down. Who was stupid enough to buy stocks yesterday when they were up 400 points. In a rational system--one that is not broken--would not the amplitude of these market moves keep getting smaller, as people realize what is going on? In other words, based on experience, why do sellers not come in when the Dow is up 200, and buyers come in when the Dow is down 200, knowing that Dow moves after that will likely be reversed? How insane (that definitions of "insanity" again) do you have to be to keep doing to same thing over and over again, expecting a different result? You evidently have to be as insane, and stupid, as a Wall STreet person. And then you come on CNBC, or the media, and talk as if these short term market moves are based on fundamental events. Let me be blunt: Anyone who fails to recognize what is going on here is either totally stupid, or has an agenda (as Rush does).

Have I not said that these fictional market moves are not so much evidence of stupidity, as much as they are evidence of markets that are broken--as Wall Street has turned into one vast computer gambling casino? It is both. Yes, "smart guys" gaming the system are making money with these games (and sometimes losing their shirts). But it is still stupid to be in a positon ere you are forced to make losing trades (after the market is already in the midst of one of these fictional computer moves)?

Worse, are stock traders "gaming the system" not destroying the system? Sure they are. Why should people stay in the stock market, when it is so obviously no longer an investment vehicle, but a computer gaming vehicle? You could argue I am the stupid one, along with the other sheep still in the stock market, because we continue to participate in a broken system. However, leaving the "system" to the computer gamers will destroy us, in the end. It may already have, as the recent "financial crisis" was precipitated as mujch by the gaming on Wall Street as by the stupidity in financial institutions (stupidity that was multiplied on Wall Street by people like Paulson, as head of Goldman Sachs, who failed to realize the risks they were running).

Nope. The title/headline of this entry is solid. Wall Street people (and their counterparts around the world) are the most stupid people on Earth. There is just no competition, except from "journalists"--meaning that financial "journalists" may be the sub-category of the truly stupidest people on Earth.

Yes, I am perfectly aware that there will be a time when the "market" actually moves one direction or another, outside of this "trading range". So what. It does not change a word I say above. In a healthy stock market, which is not broken, the Dow would rarely move up or down even a 100 points. Most daily moves would be 20 to 50 points. Weekly moves would not be 1,000 points, but usually a 100 points or less. I am right on this. The present system is broken, and no one appears to be trying to fix it. No, I am not sure how to fix it, but someone should be trying. I have suggested banning day trading (buying and selling the same stock, or any number of shares of that same stock, in a single day). I have suggested banning short selling (but not "puts"--which require purchasing an option) for at least six months, and maybe forever. There are surely other things that can be done to try to stop this ridiculous computer "program" trading. Why are you not hearing this elsewhere, aside from brief mentions from time to time? I told you. These people are stupid--as stupid as the people willing to pretend the emperor had clothes on in the famous story about the naked emperor who conned himseslf, as well as the public he ruled.