Manipulation of stockHam Rove voiced the question if such manipulation is legal.
I'm no lawyer and I have no intention to enter this discussion because the possibility for "cyber-crimes" is relatively new means it will take the law-makers a long time to catch up with the new reality and therefore there is little hope that we will get help from this corner. However, if we continue on this path the stock market will eventually be killed and that would be nobody's advantage. So let us begin to analize the situation; once we fully understand how it works maybe we can apply a little bit of pressure to the perpetrators. Today again there was a healthy demand for avo shares at a relatively fair price. Not for long; transaction took place that lowered the price in no time. Panic set in and the volume increased. I do not know if these super-computers can bypass the normal transactions and thereby lower the price or if with programing the computor will size the oportunity whenever for a fraction of a second there are no bids at the dominating price. Both ways are possible. Also, it is imortant to know that the lower the price of the shares are in relation to the fair value the faster they recover during a period of no manipulation. This creates the ideal conditions for these operators: whenever the price went up they sell pushing the price down a little just to activate the big push downwards by means of the described manipulation. Then they patiently buy until those who realize that ther is a bargain to be had push it up which prompts the operators to start their game again. Of course I simplified the procedures and did not talk of use of shorting or other accepted procedures but in essence that would do the trick. Also, what I do not know is if the banks are involved or not. If they are we should let them know that we realise what they are doing and we ask them to stop. If they are not then we have to apply pressure that they improve the system that would not allow such behaviour. I will not talk now about other tricks which are added because this would not help us to improve the situation. Rather, what is needed now is that we exchange ideas.