this post was submitted on 19 Nov 2023
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The last time this happened, voters didn’t credit Bill Clinton. That may be a bad omen, or a good one.

If the stock market chose presidents, Joe Biden would be a shoo-in for reelection in 2024. The market rallied this month amid growing optimism about the economy, with the S&P 500 zooming 1.9 percent Tuesday on news that the consumer price index rose only 3.2 percent in October (compared to 3.7 percent in September). Stocks rallied again Wednesday on news that the producer price index fell 0.5 percent. Commentators are no longer debating whether the economy will experience a “soft landing” (i.e., a reduction in inflation without recession). The only question now is when it will arrive. The S&P 500 seems to have decided it’s already here.

But the stock market doesn’t choose presidents. Voters do, and polls continue to show they think the economy is in terrible shape. A Financial Times–Michigan Ross Nationwide Survey conducted November 2–7 is absolutely brutal on this point.

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[–] [email protected] 1 points 9 months ago (1 children)

For the markets daily volume 90% is traded off market without affecting the price due to pfof and bs exemptions from market makers that allows them to very effectively naked short stock for "liquidity". Couple that up with nearly every big firm using the Aladin algorithm and you can make the market do what ever you want granted a story is going which supports your narrative. I'll believe we had a soft landing when equity swap data reporting is not getting continuously delayed hiding true market positions. Also don't forget we have a plunge protection team who's job is to short or buy stocks with taxpayer dollars to pretend the market is stable. Also don't forget this started before covid.

[–] [email protected] 2 points 9 months ago (1 children)

Do you work in finance?

But what does this have to do with the rest of what I said? You seem to be arguing that the market is a reflection of the economy, just some secret market that no one knows about.

[–] [email protected] 1 points 9 months ago (1 children)

I'm explaining that the market you base your health of an economy on is manipulated to all hell. Has abandoned most of the principles that made it a reflection of the economy and is still being paraded as if it's some useful metric. Aladin and most other market algos are trained on prior patterns and predict their reappearance, have enough firms using that system and its able to predict its own moves. I.e the reason they can predict some semblance of the market is because most of your market works on the same trading signals and data points. Allowing it to react to its own interpretation of the market that was created by its own signals. Allow market makers exemptions to short selling for liquidity purposes and the ability to print to the tape the trades that are favorable to them, and you can swing a market any which way you want.

You seem to be arguing that the market is a reflection of the economy, just some secret market that no one knows about.

No I'm pointing out that the metric in which we base our economies health is pretty much a show built on confirmation bias from using systems that predict and reinforce biased data points.

[–] [email protected] 1 points 9 months ago

No one here is basing the health of the economy on the market. This has never been true, even pre automated trading. However, sometimes the markets do react to good news in the general economy, as they are not completely decoupled, and this is what I'm talking about.

I'll try again, do you work in finance?