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Is the government manipulating the market?

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  • Username999
    Username999 Posts: 536 Forumite
    500 Posts First Anniversary Name Dropper
    One person caring about another represents life's greatest value.
  • CreditCardChris
    CreditCardChris Posts: 344 Forumite
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    edited 6 April 2020 at 7:21PM
    They are not buying specific stocks, they are buying up everything, the entire index. 

    Whether they are allowed to or not isn't important, the Federal reserve does what it wants and the public is kept out of the loop. The stock market was crashing and the Fed came in with trillions of dollars to stop the bleeding.
  • masonic
    masonic Posts: 27,353 Forumite
    Part of the Furniture 10,000 Posts Photogenic Name Dropper
    edited 6 April 2020 at 7:32PM
    They are not buying specific stocks, they are buying up the index. 

    Whether they are allowed to or not isn't important, the Federal reserve does what it wants and the public is kept out of the loop. The stock market was crashing and the Fed came in with trillions of dollars to stop the bleeding.
    You can't just buy "the index". The index is just a hypothetical portfolio of companies. I very much doubt they are buying shares in every company listed in the S&P 500, or the Dow Jones, or indeed the Russell 3000, in proportion to their market capitalisation, and I doubt they are investing in an index tracker or other similar financial instrument so that the underlying shares are bought by a third party.
  • Prism
    Prism Posts: 3,848 Forumite
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    edited 6 April 2020 at 7:36PM
    They are not buying specific stocks, they are buying up everything, the entire index. 

    Whether they are allowed to or not isn't important, the Federal reserve does what it wants and the public is kept out of the loop. The stock market was crashing and the Fed came in with trillions of dollars to stop the bleeding.
    Ah so its a conspiracy then since they are not officially doing it nor can. Its not like they could own the shares as we would all know. So how are they doing it? ETFs?
  • Username999
    Username999 Posts: 536 Forumite
    500 Posts First Anniversary Name Dropper
    masonic said:
    They are not buying specific stocks, they are buying up the index. 

    Whether they are allowed to or not isn't important, the Federal reserve does what it wants and the public is kept out of the loop. The stock market was crashing and the Fed came in with trillions of dollars to stop the bleeding.
    You can't just buy "the index". The index is just a hypothetical portfolio of companies. I very much doubt they are buying shares in every company listed in the S&P 500, or the Dow Jones, or indeed the Russell 3000, in proportion to their market capitalisation, and I doubt they are investing in an index tracker or other similar financial instrument so that the underlying shares are bought by a third party.

    But you can buy the Index Futures and the cash index follows.
    Where Goldman Sachs go, the herd follows, or used to.

    One person caring about another represents life's greatest value.
  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    They are not buying specific stocks, they are buying up everything, the entire index. 


    Which index? There are over 25,000 listed companies in the USA . 
  • Username999
    Username999 Posts: 536 Forumite
    500 Posts First Anniversary Name Dropper
    They are not buying specific stocks, they are buying up everything, the entire index. 


    Which index? There are over 25,000 listed companies in the USA . 

    Easily managed by any half decent computer algorithm.

    One person caring about another represents life's greatest value.
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