Ramanisblog

Tag: stock market

  • Fraud That is Stock Market, How Naming Drives.

    I am one of the view that the stock market is a huge fraud and a form of legitimized gambling with the active connivance of the Governments.

    The stock market is played by a minuscule percentage in India, may be .001 % of the population.

    But th Government decides its policies on its performance.

    One would expect the economy in prosperity when the stock market is booming.

    But facts are other wise.

    When the stock market is down, the economy is cited as the reason for the poor performance.

    Prosperity of the share market is for the prosperity of the Rich.

    Having been in a Senior management position I know how the IPOs are rigged.

    You pay a percentage to the underwriters.

    They, who have funds at their disposal or contacts, including the Banks and Institutions, buy up the stocks, and inflate the price.

    Gullible Public laps it up and it drives by.

    Again the stock prices go up.

    The underwriters cash in on the boom and quit, depending on the new business they get.

    The promoters, depending on whether they want to run the business or run away either cash in on the boom or continue fixing up Institutions.

    This is only the tip of the iceberg.

    Now The New Yorker has published a report as to how stocks rise in prices.

    By a simple piece of clever naming!

     

    Story:

    Between the beginning of October and early November, the following eight companies were among more than twenty that began trading on the New York Stock Exchange: OCI Partners, Springleaf Holdings, Brixmor Property Group, Essent Group, 58.com, Mavenir Systems, Midcoast Energy Partners, and Twitter. They’re a diverse group of tech, energy, property, and finance companies, valued at their respective I.P.O.s between three hundred and sixty million dollars (Mavenir Systems) and $24.5 billion dollars (Twitter).

    By the end of their first day of trading, Midcoast, Springleaf, 58.com, and OCI had risen in value, whereas Essent, Brixmor, Mavenir, and Twitter had fallen. At first it’s hard to discern a difference between the early appreciators and the early depreciators. Many experts argue that it’s impossible to reliably forecast stock prices in the short run. In his classic 1973 guide to investing, “A Random Walk Down Wall Street,” the Princeton economist Burton Malkiel famously claimed that “a blindfolded monkey throwing darts at a newspaper’s financial pages could select a portfolio that would do just as well as one carefully selected by experts.” Investors, Malkiel argued, were at the mercy of the markets, and though prices generally rise in the long run, it’s impossible to beat the market reliably and consistently. Malkiel’s book has sold more than a million copies…

    Short-term investing is certainly a gamble, but if you look back at the eight companies, you’ll find one subtle feature that distinguishes the climbers from the fallers: whether their ticker symbols are pronounceable according to the rules of English—that is, whether it’s possible to read them out loud as if they were words, without adding extra sounds. The pronounceable OCIP, MEP, LEAF, and WUBA (OCI, Midcoast, Springleaf, and 58.com, respectively) appreciated by between one percent and fifteen per cent, whereas the unpronounceable ESNT, BRX, MVNR, and TWTR (Essent, Brixmor, Mavenir, and Twitter) depreciated by between half a per cent and fourteen per cent. Eight stocks is a tiny sample by any standard, and stock prices are shaped by far more powerful forces—but the relationship between ticker pronounceability and early performance seems to hold with larger samples, too. (The trend holds if you include all twenty-three stocks that began trading between early October and early November: after twenty-four hours on the market, seventy-five per cent of the companies with pronounceable symbols appreciated, but only forty-seven per cent of those with unpronounceable tickers appreciated.)

    Several years ago, Daniel Oppenheimer and I examined the performance of nearly a thousand stocks that entered the New York Stock Exchange and American Exchange between 1990 and 2004. We separated stocks with pronounceable ticker symbols from those with unpronounceable symbols. Across both markets, stocks with pronounceable symbols enjoyed a bigger post-I.P.O. boost than their unpronounceable counterparts. The effect was strongest during the first few days of trading; over time, it weakened, but never quite vanished.

    http://www.newyorker.com/online/blogs/currency/2013/11/the-secret-science-of-stock-symbols.html?utm_source=tny&utm_campaign=generalsocial&utm_medium=facebook

     

  • Dubai ruler lashes out at international investors-Telegraph.

    Very funny.Your country’s company has failed to meet its creditors.It is in financial mess.All along you have never openly said that the government has nothing to do with Dubai World.Once the bubble bursts , you immediately put out a statement that the govt.has no ties with the company;You are too careful.You did not say you or your kin has or had. Now will you disclose the stock holding pattern of Dubai World or its parent company?Or is the shell company registered in St.Kitts or some other place?
    Leaving that aside, what do you expect the foreign investors to do?To hold their stock?
    Don’t be ridiculous.Of all people you know how and when to pull out.
    Any way congratulations on a well executed scam.
    Story:
    Dubai’s bourse closed 5.6pc lower while Abu Dhabi shed 3.5pc on the second day of trading since Dubai World asked to delay the repayment of a $3.5bn (£2.1bn) loan for six months.
    Traders said foreign investors were selling stocks after the government said that it would not guarantee the debt of the state-controlled companies. A further statement released late on Monday night in which Dubai World said it was restructuring $26bn of debt but made no mention of its intention to repay the loans due in two weeks’ time.

    Humam al-Shamaa, an analyst at Al-Fajr Securities, said: “Foreign portfolios are still pushing to exit the markets… Those who tried to pull out and did not manage to do so are still trying today.”
    The gloom prompted a furious outburst from Sheikh Mohammed bin Rashid al-Maktoum who criticised the reaction of international investors to the crisis, claiming: “They do not understand anything.” He added: “We are strong and persistent. It is the fruit-bearing tree that becomes the target of [stone] throwers.”
    Sultan bin Saeed al Mansouri, the UAE’s minister of economy, issued a long-statement extolling the strengths of the emirates. He said the economy has been built on a diverse mix of tourism, trade and services. He added: “The UAE has already taken [sic] concerted efforts to meet the challenges arising from the financial crisis.”
    However, the assurances failed to stop a flood of money being pulled from the stockmarkets. Dubai’s leading real estate sector fell by 9.2pc, near the one-day maximum allowed drop of 10pc, while the finance and investments sector shed 7.5pc of its value. In Abu Dhabi, the property sector fell 9.8pc, while banking fell 5.6pc.
    Moelis & Company, the advisory boutique set up by Ken Moelis, has been appointed to advise on the restructuring of Dubai World. He will help Paul Reynolds of Rothchild who was re-appointed after the company announced its restructuring last week.
    Outside the Gulf, markets rebounded on the views that the Dubai crisis was a local problem that could be contained. European stocks notched up their biggest one-day gain in four-and-a-half months. Banks were among the biggest risers, particularly those hit by fears over exposure to Dubai. Mike Lenhoff, at Brewin Dophin said: “It looks like (Dubai’s debt) was a storm in a teacup. But it’s a reminder that you have these time bombs ticking away. They’ll go off from time to time, though this one has not had a major impact.”
    http://www.telegraph.co.uk/finance/markets/6703410/Dubai-ruler-lashes-out-at-international-investors.html