POOR RICHARDS REPORT
\n Chapter 14
\n A REAL HONEST TO GOODNESS PANIC
\n It might start at 2:30 in the afternoon EST and just dribble down to about 126 point drop in the S&P 500 Index which will require a 15 minute trading halt. That is when the circuit breakers take over. It is exactly 3:20pm when the market resumes and immediately starts it’s slide. By this time traders are trying to unload their holdings in stocks, and by 3:25PM the market is down over 20% . The market then shuts down for the day. It would be a historic day in finance when the Circuit breakers were finally used.
\n Market gurus would frantically search for a reason… and then a clerk in a back office would make an unofficial announcement. Their computer had had a double order by mistake and it kick started their computer high frequency trading programs. So the first 126 point drop was computer driven. Then individual and margin orders kicked in other computer driven programs.
\n This is dangerous. Computer driven programs are taking over the markets instead of individual investors so that the owners can make billions while we quake in our boots.
\n No one can really tell you when the selling will start or the exact top of the individual markets, but when it starts, the slide will be a doozy, because all the safeguards have been tossed in the recycle bin by our representatives who received payola from delighted lobbyists.
\n The Dodd\u2013Frank Wall Street Reform and Consumer Protection Act was signed into federal law by President Barack Obama on July 21, 2010 at the Ronald Reagan Building in Washington, DC. Passed as a response to the Great Recession, it brought the most significant changes to financial regulation in the United States. With this reform, the protection of the individual investor was severed for the protection of the \u201cbanks\u201d.
\nThe \u201ccontinuing education courses\u201d that qualified financial analysts must take contain true false questions. When they are answered wrong the test can be retaken immediately. That is proof of how confusing the D-F ACT is. 800 pages long with 3000 pages of footnotes trying the clarified rulings.
\n This Act should be trashed completely and the reforms that I will express in the next chapter should be implemented post haste.
\n When the next day dawns we will find out the other markets all over the world have also sold off as everyone wants cash.
\n In the United States stocks open with the symbol BW \u2013OW. This means bid wanted and offer wanted. Name your price. Finally offerings are made and transactions ensue at various levels depending upon the company and the dividend. A week later most securities are selling around their book value* or less and several hedge fund managers may have died mysteriously. Unemployment rises to the teens and soup lines appear all over town. Police stop arresting because the jails are full and they release most as harmless vagrants. Several companies announce that their debt will be in default due to “market conditions”. Trading hours are shortening to 10am \u2013 3pm for the weekday. Pension plans falter and deflation rears its ugly head. Calmness overcomes most of the country as people line up for credit or are off to sell household items or treasures for food and clothes. We start a barter system as efforts are made to recall our elected officials.
\nSoon people become more realistic and self-reliant. Neighbors start helping each other and protecting mutual interests. Greed disappears; as a show of wealth brings social disapproval. Armies start marching against each other, but stop because of no pay no food. The planet earth is in chaos.<\/p>\n
All the above can happen unless we institute the reforms mentioned.
\nWe must reform the \u201cbanks\u201d and the entire industry before it is too late.<\/p>\n
*Book value: if the company sold everything for cash that is what one<\/p>\n","protected":false},"excerpt":{"rendered":"
POOR RICHARDS REPORT Chapter 14 A REAL HONEST TO GOODNESS PANIC It might start at 2:30 in the afternoon EST and just dribble down to about 126 point drop in the S&P 500 Index which will require a 15 minute trading halt. That is when the circuit breakers take over. It is exactly 3:20pm when […]<\/p>\n","protected":false},"author":83,"featured_media":746809,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[750],"tags":[],"class_list":["post-109020","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-richard-de-graff"],"_links":{"self":[{"href":"https:\/\/www.turkishnews.com\/en\/content\/wp-json\/wp\/v2\/posts\/109020","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.turkishnews.com\/en\/content\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.turkishnews.com\/en\/content\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.turkishnews.com\/en\/content\/wp-json\/wp\/v2\/users\/83"}],"replies":[{"embeddable":true,"href":"https:\/\/www.turkishnews.com\/en\/content\/wp-json\/wp\/v2\/comments?post=109020"}],"version-history":[{"count":0,"href":"https:\/\/www.turkishnews.com\/en\/content\/wp-json\/wp\/v2\/posts\/109020\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.turkishnews.com\/en\/content\/wp-json\/wp\/v2\/media\/746809"}],"wp:attachment":[{"href":"https:\/\/www.turkishnews.com\/en\/content\/wp-json\/wp\/v2\/media?parent=109020"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.turkishnews.com\/en\/content\/wp-json\/wp\/v2\/categories?post=109020"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.turkishnews.com\/en\/content\/wp-json\/wp\/v2\/tags?post=109020"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}