Originally Posted by Dennis in MA
Question for the masses: If the government controls the stock market, why did it go from 1525 to 677 in less than 2 years???? Or is it like the DMV - they are only in control when it's for evil. When they are inept, it doesn't count?
Who said specifically the government controls the stock market? I believe what I said was that it was manipulated. Now I will admit we are approaching a collusion between corporate and government that approaches the definition of facism, so yea they do have a hand in it but once again you paraphrase incorrectly to deflect from the fact that you have no facts.
To actually answer a question you posed: because bubbles must burst; period. The housing market was an artifical bubble inflated by government intrusion into the free market (Community Reinvestment Act) and banks (private) using creative and down right dishonest methods of qualifying people for loans they shouldn't get but the government believes they should. Keeping interest rates far too low for far too long by the Fed (public/private entity) kept the easy money flowing into homes. Banks then take advantage of the bubble and package all sorts of mortgage backed securities that are billed by the rating agencies (private) as being iron-clad AAA investments. So the artifical bubble was created by a collection of private and government entities.
There are all sorts of factors that lead to manipulation, and to answer your other smart-***** question: even the highs are due to government ineptitude. They try to directly intervene into earn votes and keep their jobs, and in doing so they push things way too high way too fast and screw with the freemarket system to the point of no return.
Everything that occurs naturally finds a natural equilibrium on its own without outside influence. There are way, WAY too many factors and systems and individuals to effectively control an entire eco-system. The same goes for the free market system as it is intended to exist.
You liberals love to scream about how we are damaging the environment with our pollution and even a small amount of pollution will eventually build up and destroy the eco-system. Well the free market is the exact same way. It is a delicate eco-system that even a small amount of artifical interference will damage. We have screwed with the free market for so long and so thoroughly we have polluted it beyond repair.