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S&P and the Bilderbergers: All Part of the Plan?

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What just happened in the stock market? The week of 8-8-11, the Dow Jones Industrial Average rose or fell by at least 400 points for four straight days, a stock market first.

The worst drop was on 8-8-11, when the Dow plunged 624 points. That was the first day of trading after US Treasury bonds were downgraded from AAA to AA+ by Standard and Poor's.

But the roller coaster actually began on Tuesday, 8-2-11, the day after the last-minute deal to raise the U.S. debt ceiling -- a deal that was supposed to avoid the downgrade that happened anyway five days later.   The Dow changed directions for eight consecutive trading sessions after that, another first.  

The volatility was unprecedented, leaving analysts at a loss to explain it. High frequency program trading no doubt added to the wild swings, but why the daily reversals?   Why didn't the market head down and just keep going, as it did in September 2008?  

The plunge on 8-8-11 was the worst since 2008 and the sixth largest stock market crash ever. According to Der Spiegel, one of the most widely read periodicals in Europe:

"Many economists have been pointing out that last week's panic resembled the fear that swept financial markets after the collapse of US investment bank Lehman Brothers in September 2008.

"Then as now, banks stopped lending each other money. Then as now, banks' cash deposits at the central bank doubled within days."

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On Tuesday, August 9, however, the market gained more points from its low than it lost on Monday. Why? A tug of war seemed to be going on between two titanic forces, one bent on crashing the market, the other on propping it up.

The Dubious S&P Downgrade

Many commentators questioned the validity of the downgrade that threatened to collapse the market. Dean Baker, co-director of the Center for Economic and Policy Research, said in a statement:

"The Treasury Department revealed that S&P's decision was initially based on a $2 trillion error in a ccounting. However, even after this enormous error was corrected, S&P went ahead with the downgrade. This suggests that S&P had made the decision to downgrade independent of the evidence."  [Emphasis added.]

Paul Krugman, writing in the New York Times, was also skeptical, stating:

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"[E]verything I've heard about S&P's demands suggests that it's talking nonsense about the US fiscal situation. The agency has suggested that the downgrade depended on the size of agreed deficit reduction over the next decade, with $4 trillion apparently the magic number. Yet US solvency depends hardly at all on what happens in the near or even medium term: an extra trillion in debt adds only a fraction of a percent of GDP to future interest costs . . . .

"In short, S&P is just making stuff up -- and after the mortgage debacle, they really don't have that right."

In an illuminating exposé posted on Firedoglake on August 5, Jane Hamsher concluded:

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Ellen Brown is an attorney, founder of the Public Banking Institute, and author of twelve books including the best-selling WEB OF DEBT. In THE PUBLIC BANK SOLUTION, her latest book, she explores successful public banking models historically and (more...)

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Max Keiser was talking about the term used by Will... by Mike Preston on Friday, Aug 19, 2011 at 8:14:37 PM
James Galbraith pointed out that when regulation i... by Lawrence Worley on Friday, Aug 19, 2011 at 10:28:44 PM
It is nice to see a comment that presents honest v... by Mike Preston on Friday, Aug 19, 2011 at 11:01:34 PM
Great line! Yes I think it won't fix the problem t... by Ellen Brown on Saturday, Aug 20, 2011 at 12:48:51 AM
  You've convinced me.   It IS a co... by Lawrence Worley on Friday, Aug 19, 2011 at 8:30:47 PM
Agreed -- they've got control of the money spigots... by Ellen Brown on Saturday, Aug 20, 2011 at 12:53:04 AM
So how are we doing on the creation of 'state bank... by JaneAnne Jeffries Johnson on Saturday, Aug 20, 2011 at 8:31:51 AM
As I understand the issue, it's either PUBLIC or P... by George Osled on Saturday, Aug 20, 2011 at 11:17:38 AM
YES , WE CAN...YES , WE CAN...WE WILL WIN IN WAR O... by MAKAKI YIDDISHEK on Saturday, Aug 20, 2011 at 2:57:28 PM
  Let's have a sense of proportion.  Th... by Keith Pope on Saturday, Aug 20, 2011 at 3:15:07 PM
David Rockefeller is Bilderbergers.Bilderbergers i... by Janet Gaudiello on Saturday, Aug 20, 2011 at 6:34:06 PM
Ellen Brown has previously put up what I think is ... by Mike Preston on Saturday, Aug 20, 2011 at 10:17:00 PM
But this isn't news folks.. this has been going on... by richard on Sunday, Aug 21, 2011 at 12:13:02 AM
Bunch of globalists.... by Afi James on Sunday, Aug 21, 2011 at 12:13:25 PM
The common man decides what is going on with econo... by John Smith on Monday, Aug 22, 2011 at 7:23:20 AM