What Is "Bond King" Jeff Gundlach Worried About? Tech Stocks and The Dollar
As was the case in 2000 we look for the Nasdaq 100 (and the composite) to lead the way down, possibly even as the DJIA and S&P trade higher.*
Here's the comparison of the 100 vs. the Dow Jones Industrials over the last month via BigCharts (also on blogroll at right):
And why, wary reader may be asking, is this noteworthy?
We've mentioned, for years, how NYSE specialists set up false appearances in the market. Here's a 2009 version:
Manipulating the Dow Jones Industrial Average
Back in the bad old days, the specialists* in the Dirty Thirty would move their own books around to their personal benefit but from time to time would coordinate their efforts.That was posted three days before the market bottom in March 2009 with this final note:
The classic move would be to position for a decline while giving the impression to the investing public that "Hey, the water's fine, come on in".
They would do this by shorting the lower priced DJIA components while maintaining the higher priced stock, or even taking those up a bit.
When the trap was sprung, those higher priced stocks would be collapsed, triggering stop loss limit orders to feed the fear, and nary a specialist bid in sight. As the ticker spread the story to the country, the sell orders would come pouring in and accelerate the down move. Then the margin calls would go out, literally stripping stock from the accounts of the unwary....
...If these were the bad old days, and one were looking for the opposite move, up rather than down, then one would look for a way to paint a negative picture, perhaps by taking a high priced stock down while the lower priced issues were firming up.It's part of the Grassy Knoll theory of investing. And when I mention it it's only half tongue-in-cheek.
That's how they used to do it in the old days*....
