Ouch! With the DJIA down over 500 points on Friday (the actual publication date of this article), only to be proceeded by drops week long, it really makes you wonder. Don’t worry – you’re not crazy. Stock market manipulation is possible, and I’m willing to bet it happens more than we acknowledge.
As proof, I’m going to show you how Yahoo and MarketWatch did on Thursday, August 21st 2015. Then if anyone actually knows the law would like to chime in, I would be interested in knowing if this is illegal ( I have a feeling it is). I hope to present this accusation in a clear and understandable fashion via video, images, and written opinion. Let’s get started.
What We Read About the Stock Market Affects Trading
Everything we hear and listen to affects our opinion in some way. Many times, if it comes from a source that seems legitimate, we will give value to that piece of information. While reading about stocks online from a trusted source like Yahoo or MarketWatch, you expect some level of sophistication. They are, however, professional news organizations:
Upon researching MarketWatch further, I come to learn it is owned by Dow Jones and Company. Really?
Now, Stock Market Manipulation is a big accusation, so let me be more specific: Yahoo, MarketWatch, and Dow Jones did what is referred to as “Stock Bashing”
- Stock Bashing: “This scheme is usually orchestrated by savvy online message board posters (a.k.a. “Bashers”) who make up false and/or misleading information about the target company in an attempt to get shares for a cheaper price. This activity, in most cases, is conducted by posting libelous posts on multiple public forums. The perpetrators sometimes work directly for unscrupulous Investor Relations firms who have convertible notes that convert for more shares the lower the bid or ask price is; thus the lower these Bashers can drive a stock price down by trying to convince shareholders they have bought a worthless security, the more shares the Investor Relations firm receives as compensation. Immediately after the stock conversion is complete and shares are issued to the Investor Relations firm, consultant, attorney or similar party, the basher/s then become friends of the company and move quickly to ensure they profit on a classic Pump & Dump scheme to liquidate their ill gotten shares. (see P&D)” – Source: WikiPedia
In this case, it was on large news websites (Yahoo and Marketwatch) like so:
From my understanding, all advertisements must be either clearly an ad, or notated as “Sponsored”, especially in news feeds.
Who Benefits From Stock Market Manipulation
So what is the result? When the DJIA drops around 1,000 points in a week. Financial companies like Fidelity and Scott Trade make tons of commissions in a volatile market – paid every time their automated system make a trade for clients. Groups that set up and executed the manipulation make money when it goes as planned by buying or selling stocks at artificial prices.
Who Losses From Stock Market Manipulation
I’m willing to bet a lot more people than gain from it. Think of all the productivity wasted my people checking their stocks at work. How much time does it take to process a trade, both physically and mentally? How much fossil fuel must be burnt to process these fraudulent trades? It is not productive for society, the environment, or the stability of capital markets.
What Do We Do About It
Stock markets can be a thing of good, spreading the risk and rewards of capitalism over the masses, and providing funding needed to shape the future for the better.
Manipulation preys on the weak, those that don’t know about how money, markets and capital work. Investors need to understand how business and the world works and not just rely upon news in general to shape decisions. The news can be manipulated as I’ve just shown you.
The question is did Yahoo, MarketWatch and the Dow Jones Company do so illegally?
Please leave your questions and thoughts in comments bellow and share to put a stop to Stock Market Manipulation.