She Dow plunged almost 1000 points intraday (the biggest in history) today before taking back some of those losses and closing -3.20% or -347.80. Everyone has an explanation for the forex education but almost none of those reasons relate the markets to the economy (except maybe blaming Greece).
The Greeks are burning down their own city and taking the Euro down with it. The EUR/USD has been in a steep decline for the last week and is currently trading at the 1.2600 level.
Gold has spiked up during yesterday’s drop in the equities markets, breaking 1200 and heading toward its all time high of 1226 (currently at 1205.47).
Whatever the cause for the market crash yesterday, it has nothing to do with the state of the economy. It is a system error, a trading error or those damned SHORT-SELLERS! Granted that some stocks like Accenture seemed to behave a little odd as it dropped to $0.01 for a short time. CNBC, during all the chaos yesterday, explained that the crash was due to a trader error. Apparently this dude (at CITI) was trading with inflata-hands on and instead of entering a 15 million short order on the S&P, he entered a 15 Billion short order.
The crash was due to EVERYTHING and ANYTHING but the fundamentals of the economy. We have almost doubled the number of the Dow since early 2009. This 15 month rally is overbought, not to mention that it is an artificial rally. The last three red days, or the crash yesterday, has nothing to do with fundamentals.
It has nothing to do with the ever-increasing debt load the US has. Nothing to do with the ever-increasing unemployment figures. Nothing to do with the the fact that stocks are extremely overvalued compared to their earnings. It is all because of SKYNET. The computers done fucked up! CNBC continues to do it’s job and promote the “Great Recovery” and throw the blame elsewhere.
It will be very interesting to see how Asia reacts (NIKKEI currently down 400 or almost 4%) and what the overnight positions look like when New York opens up tomorrow. And for those who thought they got in at great prices during yesterdays crash – nope, NASDAQ announced it will be canceling trades done between 2:40 and 3PM. It wasn’t the markets, it was SKYNET!
If you haven’t already seen this clip; here is the clip of Jim Cramer playing the role of The Terminator, “saving” the markets – BUY BUY BUY!!!