Courtesy of Jesse's Cafe Americain
Charles Biderman and Chris Martenson: The Problem With Rigged Markets
Here is a fascinating Chris Martenson interview with Charles Biderman.
This interview highlights the Ponzi-like, artificial nature of the current stock market rally.
It reminds me very much of the 2003-2007 bull market that ended in tears. I have included a chart of what I called at the time 'The Great Reflation' at the end.
Charles Biderman: The Problem with Rigged Markets
"Even Wile E. Coyote had to come back down to earth sooner or later", says Charles Biderman, founder of TrimTabs Investment Research. In his opinion, the prices of stocks and bonds – enabled by excessive financialization of our economy and central bank money printing – have been defying gravity for a dangerously long time.
If we continue to do all we can to preserve the status quo — to maintain "phony" asset price levels as Charles calls them — at best we will restrict overall growth and handicap the economy.
The problem isn't so much the unfairness and malinvestment evident in a rigged market. As Charles shrewdly asks: what happens when the market becomes un-rigged?
We've never experienced the unwinding of an entirely manipulated financial system, so we can't predict for sure. But at this point, a painful collapse of our markets and loss of the US dollar as the world's reserve currency seem entirely plausible…
Read the rest here.
