For the last
two weeks we are witnessing the market go down, go up and then take another
nose dive and is now down approximately 10%.
Yet the economy does not appear to be affected as this economy seems to
grow in jobs, salaries and production.
What we have
learned as a result of this ripple in the market is the rise of the
machines. What many investors did not
know is that firms are using computers that have algorithms that will
automatically buy or sell when the market reaches a preset level either up or
down. What this does is buying and
selling is done almost instantly while the small investor must call their
broker to either buy or sell that cannot keep up with the speed of the
machines. So, the brokers and their
firms are making money, protecting their investment by the programmed
machines. Unfortunately, it appears the machines have over reacted and we are
witnessing the result. We know the
market was growing at an enormous rate and a correction was inevitable, but
what we are witnessing is what can happen when you let machines and not humans
control events.
We now have
to wonder will these machines have their programs improved to avoid these types
of events or those in control of the machines are enjoying the money being made
and may just wait a while longer while the small investor gets taken to the
cleaners.
I believe
the SEC must investigate and explain this to the public. When the rich and powerful can buy low and
sell high and then buy when the stocks decline that are caused by programmed machines,
makes one wonder are we being used.
The rise of
the machines was the theme in the Terminator movies. I wonder?
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