The little-used NYSE rule that can tame a wild market

[cronus]

http://www.cnbc.com/2015/08/24/rule-48- ... arket.html

The little-used NYSE rule that can tame a wild market

In a historic move, the New York Stock Exchange invoked the little-used Rule 48 to pre-empt panic selling at the stock market open on Monday. This followed a dramatic drop in pre-market open futures, with the Dow Jones Industrial Average futures falling more than 700 points.

The goal of Rule 48 is to ensure orderly trading amid financial market turbulence. It's only used in the event that extremely high market volatility is likely to have a floor-wide impact on the ability of designated market makers (DMMs) to disseminate price indications before the bell.

Unlike a circuit breaker that stops stock trading, Rule 48 speeds up the opening by suspending the requirement that stock prices be announced at the market open. Those prices have to be approved by stock market floor managers before trading actually begins. Without that approval, stock trading can begin sooner.

(continued, been here before - privatise the gains and socialise the losses...)

[rainbow]

There is absolutely no reason for the market to close at all, since the transactions are all computerised.
Stockbrokers of the human variety are redundant.

[mistermack]

There is absolutely no reason for the market to close at all, since the transactions are all computerised.
Stockbrokers of the human variety are redundant.

There are a lot of vested interests keeping the whole thing going.

You would think that companies could issue shares, like bitcoins, which you could bid for on a trading site similar to ebay.
Cut down the costs of transactions, and just take a tiny percentage to maintain security.

[cronus]

The markets are not predictable except when too high(maybe) or too low(maybe). Only the astrologer knows the secret of them stock movements.

[Svartalf]

pffft, that's what they want you to believe

Truth is, NOBODY really understands stock movements, some just have a knack or feeling about them and are more successful, but could not explain them in truly rational terms

[mistermack]

There's a difference between mysterious and complicated.
There's nothing mysterious about stock exchanges, but with so many unpredictable factors involved, they are too complicated for anyone to know what will happen next.
But you can tip the balance in your favour, by getting inside knowledge of news that is highly likely to cause buying or selling. And also, by getting favourable terms with the people handling the deals, so that you can get in earlier than other people, when something happens.

It's not supposed to happen, but it happens all the time. That's what makes it hard for small people to make money gambling stocks and shares. The dice is loaded against you.

[mistermack]

Funny thing is, New York had a big bounce today of two and a half percent, following China's interest rate cut.
So that's panic measures on a monday, and big bounce on a tuesday.

I wonder what wednesday will bring?

[cronus]

The denial is strong in New York City and Ol' London town this week. It's always a good sign when your main engine conks out?

[rainbow]

It's not supposed to happen, but it happens all the time. That's what makes it hard for small people to make money gambling stocks and shares. The dice is loaded against you.

Absolutely. Big volumes from institutional investors can move the market one way or the other.
...so the fund managers can gamble with other people's (Yes, even your pension plan) money.
If they make the right decision, they pay themselves a fat bonus.
If they make the wrong decision, they can blame market volatility.

It is win-win all the way.

[Sean Hayden]

The poor bastids trying to play the market every day boggles the mind. That has always seemed like a con to me. Even if they do make a buck here and there they have to cover all the bad advice they've paid for, broker fees, plus taxes, and all their losses. If they actually have a little money to play with they have to risk it all, and all the time. -crazy

[Hermit]

The poor bastids trying to play the market every day boggles the mind. That has always seemed like a con to me. Even if they do make a buck here and there they have to cover all the bad advice they've paid for, broker fees, plus taxes, and all their losses. If they actually have a little money to play with they have to risk it all, and all the time. -crazy

You don't know a lot about the finance world, do you? The stock brokers gamble mostly with other people's money from which they deduct transaction fees for themselves. If they lose some or all of it they blame it on the vagaries of capitalism, the shenanigans perpetrated by the evil Chinese or whatever, and their clientele mostly believes them. Small time day traders get hooked through greed. They see some big time gamblers who had a prolonged lucky streak and think they too can do that.

[Sean Hayden]

A lot? no.

But I did become interested enough at one time to take a look. Learning about company finances was great. Investing makes sense. But a lot about watching markets every day and trying to play them with a little money doesn't. Besides all the expenses I just mentioned there is the problem of knowing or at least suspecting that we are all being manipulated, either by our own biases when contemplating reasons for valuations, or purposely by others.

'

[Brian Peacock]

There is absolutely no reason for the market to close at all, since the transactions are all computerised.
Stockbrokers of the human variety are redundant.

There are a lot of vested interests keeping the whole thing going.

You would think that companies could issue shares, like bitcoins, which you could bid for on a trading site similar to ebay.
Cut down the costs of transactions, and just take a tiny percentage to maintain security.

That's Goldman-Sachs business model in a nutshell.

[Brian Peacock]

pffft, that's what they want you to believe

Truth is, NOBODY really understands stock movements, some just have a knack or feeling about them and are more successful, but could not explain them in truly rational terms

Well, at least not since the trading software became self-aware in 2003.

[JimC]

pffft, that's what they want you to believe

Truth is, NOBODY really understands stock movements, some just have a knack or feeling about them and are more successful, but could not explain them in truly rational terms

Well, at least not since the trading software became self-aware in 2003.

I for one welcome our new AI masters...