friday's stage set, page-127

Thanks 9lives.

I have no illusion regarding the severity of this global crisis. The fact that the markets could rebounce despite all the bad news - I find it quite astonishing. My conclusion is that this market is dominated by a few big players and they decide which ways the markets should move. During the Bush Administration - the absence of strong hands had caused tremendous damage to the financial markets and investor psyche. The game is different now that Obama is running the show.

If all the traders are looking at the technicals - who are we to say that there are no special groups of elite traders who are experts in the field of Ganns, EW, Cycles and they jointly decide the roadmap for the SPX,DOW etc. They too could be keen students of history, amstrong, etc. From this forum alone - we have many well read people on these subjects.

Haven't anyone notice how news are conveniently leaked out? For example, an hour or two just before the US market close on Friday - news that the US Government may speed up GM bankrupcy instead of waiting till the 1 June. The indices were green for most part of the night. It was the perfect day to do this - lot of traders were away and volume were anticipated to be low. A sell down would not do too much damage, with the added benefit of getting people use to the impending GM bankruptcy.

How about Goldman upgrading UK miners the day after S&P's downgraded UK's outlook to negative? Helped to lift the UK and Europe markets. Very timingly.

With a number of you talking about important turn dates around the first week of June. Do you realise that no banks are allowed to repay the TARP until after June 8? And it can only be done in batches. How convenient.

My two cents - someone in the US government is also watching the markets - they are probably aware that the next two weeks are important and if there are signs of severe market pullbacks those banks could kiss good bye to an early repayment. So there are plenty of incentives for the big players to behave themselves and not traumatise the markets if they do not want to see their salaries and bonuses remained capped. They know that Obama Administration meant business. Mkt/Financial stability and slow healing are key ... these have been spoken time and time again.

The decision on short selling rule should be due in mid/end of June 2009. So we should see plenty of actions next month.