– The DJIA Stock Market Index Is A Hoax (The Burning Platform, March 29, 2014):
The Dow Jones Industrial Average (DJIA) Index is the only stock market index that covers both the second and the third industrial revolution. Calculating share indexes such as the Dow Jones Industrial Average and showing this index in a historical graph is a useful way to show which phase the industrial revolution is in. Changes in the DJIA shares basket, changes in the formula and stock splits during the take-off phase and acceleration phase of industrial revolutions are perfect transition-indicators. The similarities of these indicators during the last two revolutions are fascinating, but also a reason for concern. In fact the graph of the DJIA is a classic example of fictional truth, a hoax.
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A hoax? When carefully regulated, it was a good system. It had the NASDEQ for startup enterprise, for investors who were willing to gamble, the AMEX for companies that were established, but still young in stock market terms, the NYSE was for the strongly established companies, a good place for investors to put their money and be certain of a decent dividend.
All of that is gone.
The AMEX has vanished, and I watched with amazement when Twitter was launched as a promising startup on the NYSE a few months ago. I was shocked, such a thing would never have happened even 20 years ago.
Twitter is now at 50% of its startup price……no surprise here, but not good news for those who provided them money originally.
A stock market reflects the nation, and ours has become an oasis for crooks. There is now talk of merging the NASDEQ with the NYSE……..they are desperate for real money.
When 85% of all transactions are High Frequency skim and sell, I am not surprised. 85% of all transactions take, not give. Even worse, they pay nothing for the transactions.
The remaining 15% is made up of true investors, like you and me. We buy in, hold it, and hopefully, sell later at a profit……paying fees to do so. We also are expected to pay taxes on our transactions, something those playing High Frequency don’t worry about at all.
Of that 15%, we don’t know how many are purchased on margin.
The US stock market is nearly empty. Nobody trusts it, or any of the people running it. We have lost something very valuable, and it isn’t money, it is credibility. The stock market crash of 2007-08 destroyed the world economy, driving some nations into outright bankruptcy.
Nothing was done to stop the tricks that stole from investors or clean up their acts for the future. Nothing. No crooks went to jail, nobody was investigated, and it continues today just as rotten as it was before. Not surprising, considering the sort of people in power.
This explains why the US markets are in trouble. They are no longer trusted or believed, they are nearly empty. The real money is in the bottom 15%, there is no hope in the 85% to enrich the market