Tuesday, 21 May 2013
FTSE 100 Index Highest Since September 2000
Sometimes you get a better idea what is going on, by not paying attention. It's a commonly accepted procedure in sound engineering to walk out of the room and listen from outside, to get an idea of what the sound is really like. How well can you hear the low frequencies? Do the highs cut through the mix?
So it is with economics at times, I tend to filter out most of the rubbish. It's like panto time with the crowd shouting, "It's (Prosperity) behind you" and the villain replying, "oh no it's not!"
The figures that are submitted to public scrutiny don't match up to reality. Look at the official rate of inflation (RPI or CPI, you choose) It does not tally up with the price increases we are seeing in the real world, for food, fuel, and normal everyday goods.
Usually, markets rely on trading for the index to move. When indexes move with little volume of trades, then there is a likely hood of what is termed, "market manipulation". This is when those who are at the heart of the system which determines the rate of a commodity or market, alter its value for their own gain.
The recent movement in gold prices are confusing. While you would expect gold to rise in a time of economic uncertainty, the recent fall defies real world logic but ties nicely with a conspiracy of the major finance houses to get their hands on your gold at bargain prices just before the economy nosedives.
Why should gold fall now, when the economic fortunes of most sovereign states is in decline?
A sharp fall usually triggers "stop losses", automatic trades designed to place a sell order in the case of a sudden fall in price. maybe the drop is a tree shaking exercise. I don't know. I just know that the manipulation is becoming more blatant as time goes on.