|And, this is a reply that was written in response to this post... which isn't necessary to note, really, other than being correct in providing the context... investorshub.advfn.com |
And that, in a nutshell, shows why Alan C's post re the FINRA rule changes is specifically relevant. That post reveals that FINRA would consider it to be "fraudulent and manipulative" if those "sells" that occurred to meet his specific demand, today, were the result of a pairing in the market maker action we saw, with shorts meeting demand that existed, who used "international arbitrage" as a reason to short shares into that demand and not report the transaction as a short... meaning all they had to do today was to tick the ask up above his buy in order to short the "sell" of the shares at the bid instead of the ask... to paint the chart down ?
It's pretty hard to hide it when that sort of effort in manipulation is occurring, when the light volume makes it OBVIOUS.
I'd be surprised if everyone here hadn't experienced that... where the shares shown at the ask somehow turn out not to be there when you try to buy them. That's why you see multiple comments about it, with many having had that sort of experience.
I think you're correct, too, in your other comments today... pointing out that the MM's CAN'T be making any money FROM THE EFFORT IN "MAKING A MARKET" given the way they're mismanaging that effort now. So, what ARE they making money from... that has them mismanaging the trade here in the way that they are ?
Then, Alan says they reported that there were only 4% short sales in the volume reported today... which, if you could accept that as being true (which you can't), would say that the buy today was met by "real" selling. Except, we DO know for a fact that the reporting system in the number of shorts is purposefully corrupt and intended to be incomplete... enabling the use of shorts in share price manipulation without ever reporting them...
Were his buys today filled with shares that were shorted to meet the demand ? The correct answer is, we don't know if they were, or not, because not all shorts that do occur... are being reported as shorts, now... because they're not required to be reported. So, the result we have in the rules is that you're not allowed to use shorts to manipulate share prices here, while masking your effort in shorting... unless you do it through "international arbitrage". So, its legal for transactions with foreign origins to use derivatives to purposefully manipulate stocks here... just not legal for the locals to do it without a cross border effort.
Gee. I wonder who made up those rules... and what else might be lurking out there as an issue hidden in the art of the term "international arbitrage" ?
In the result, if the shares purchased today were filled with shares that were shorted from overseas to meet the demand, they would not have been reported as shorts in the numbers Alan C reported for shorts today, and FINRA seems to think, now, that might be a practice of fraud in the trade. That result would also make the representations on the charts fraudulent... making the charts a fraud... by purposefully showing the activity as "selling" instead of "buying", and by showing "distribution" occurring instead of "accumulation", etc., all in error.
Basically, if you get right down to it, more in a thin market, that says that, trade by trade, the chart shows only and exactly what the market makers want it to show... nothing more... and certainly don't show an accurate reflection of some reality in the balance in the market, rather than a purposeful bias... since they can change the representation of the "reality" of every trade on the chart, on a whim, if and as they choose to do that.
Of course, the effort that can exist intending to misrepresent the character of a trade, or a series of trades, doesn't mean that there's not value in the data, still, even if it requires seeing the data as an "absolute value"... while correcting for the errors being imposed in bias in the misrepresentation. There are statistically viable methods for filtering and removing "noise" even if it is being imposed on purpose through the imposition of a structural bias.
Charts can be accepted and used, with the known bias, or corrected for the bias if you analyse it carefully... and, either way, they will still show most of the extent of the impact of the bias that exists in the divergences in other metrics...
Layer other concerns over top of those above... like the known issue with the mis-marking of trades, purposefully corrupting the integrity of the data ? Because the rules have an exemption for "international arbitrage" (that enables short selling without the shorts ever being reported) how do you ever know if a short sale that occurs in "international arbitrage", that is not reported as a short sale, is a trade that was properly marked ?
The "exemption" that allows not reporting shorts in "international arbitrage" means the numbers in the short sales that ARE being reported are basically made meaningless... because those numbers deliberately don't include things that clearly should be included.
You know the numbers are incomplete... only more when you're aware of international participation in the trade you know exists ?
That's what Alan C is pointing out by posting the daily numbers... that they're misrepresenting the truth... intending to enable the argument "there's no shorts here"... even when there are. It has the reporting systems enabling deliberate error in reporting shorts, and enabling deliberate fraud based on that error...
The combination of "errors" in shorts that are not reported, and moving the ask up in order to misreport that transaction which IS going to occur, as a sell instead of a buy... would mean that "international arbitrage" was being used as a tool to manipulate share prices (and charts) through unreported efforts in shorting intended to suppress share prices, and through misrepresentation of the character of trades that are occurring, through short sales that exist, but aren't being reported as short sales...
It certainly requires you (or, me, at least) to question the basic legitimacy of the market making function...
Of course, IMO, there really is not any reason now, or any viable justification for sustaining the legacy market making functions we have, now... as they serve no real purpose at all, other than enabling "some" in manipulation.
So, here's a question for you....
Since the exemption exists... that means that short sales in "international arbitrage" aren't reportable as shorts... ? And, since that exemption hasn't yet been removed, and its removal wasn't even proposed before January of this year ?
That means that it probably wasn't necessary for Deutsche Bank, Credit Suisse and Canaccord to arrange their CSTI transactions, as they did, only in order to continue masking short positions that they didn't want to reveal, by having them be made reportable ???
So, there must have been some other reason for that set of transactions occurring as and when they did ?
So, what else is out there that MIGHT provide an explanation for why that series of "deals" that was done by CSTI, was interesting enough to make it important to get that done... as and when they did ?