Cliches & Conspiracies
Both get a bad rap. However, most being based largely on facts and critical thinking end up being true. Of course there is often disdain because they go against government narratives and or popular myths.
Rather than list all the many instances in recent history, let me propose a new one of my own. I have no way to prove this nor haven’t heard publicly anyone else bring up the possibility. I was thinking about this recently and can’t remember if I ever threw it out there in a comment somewhere.
Given the nature of how stock trading has changed over the decades and in recent years particularly, I believe that one of the many reasons stocks in general and high tech mammoths specifically, seem to have become one decision (buy and hold) stocks, is the very large dark pools being run by banks and some other financial institutions.
I think there is a dirty little secret that companies like Apple, Nvidia, Microsoft and the other very large tech companies with lots of cash and or top shelf credit lines, aggressively buy their own shares to keep them levitating.(nothing new there)
The unofficial deal(conspiracy on my part) is that during the quarterly periods, where for a number of weeks the companies aren’t suppose to buy back shares in front of their earnings releases, the banks and others are buying more than normal to keep the shares supported, until the blackout periods end.
They know that the companies will again start buying, so even if they sometimes have losses on their purchases, the companies will bail them out when they come back into the market.
These incestuous relationships, where the banks lend these companies money, support their stocks, even recommend them to their clients (if they are investment banks) maybe run their internal buyback and employee stock option plans etc. makes for a lot of opportunity for conflicts of interest. I have no proof, just my opinion.
Sir CM,
In a reply to another thread last week, I’d alluded to learning this about the dark pools, in the case of NVDA.
https://wallstreetonparade.com/2024/06/nvidia-hit-a-3-trillion-market-cap-last-week-dark-pools-are-making-over-300000-trades-in-the-stock-weekly/
Just curious to know if you read this before writing the above post. Not doubting your research and gut instinct. We might just be looking at the tip of the iceberg here. It is not a coincidence that all the 5-10 big banks around the world get slapped with petty fines for “irregular” trading.
GL
I think most of those fines(or at least some of them) are for manipulating gold and silver. They never get too specific with the type of trading because they don’t want to bring any more light onto what goes on. As far as the dark pools I have read various things about them over the last few years but again the banks are pretty vague as to how much info they let out about them. I think I touched on my theory in a comment somewhere over the last few months but not sure when.