How Wall Street Manipulates Investors
When you include the $trillions invested in other markets by investors, it is easy to see why the “hype” machine works so well. It is all based on investor behavior. The average investor is manipulated to believe he is incompetent and unlearned in the ways of Wall Street. By keeping investors dependent, non-informed, and rational, it is easy to control the everyday investor mind.
The average person enters the market insecure, vulnerable, and irrational. This is exactly how wall street manipulators like their prey. They will tell you to keep a rational mind. The perfect example of this was the period from 1980 to 2000. The markets had gone through a downward trending period. The economy had been in a recession in the early eighties. Then in late 1982, there was a sudden turnaround in the markets. The insiders and manipulators began buying. Then as the 1980’s progressed, the propaganda machine revved up into full gear. The public was constantly bombarded with advertising. The persuaders continued to pound their tables insisting that everyone needed investments, especially for retirement. Ring any bells?
Heading into the 90’s, the market continued to rise in value. More and more of the public were enticed to invest in the markets. In the latter 1990’s, prices were skyrocketing. Stocks that had no business rising were bought by greedy investors. The manipulation and hype was the inducement to keep buying at any price. Finally, the insiders began to unload their holdings in earnest. And soon the buying public was trapped as the markets began to collapse.
Make no mistake, the Wall Street “gang” had pocketed hundreds of billions in fees, commissions and profits. It is always the unsuspecting public who suffers the most from these exploitative schemes. As long as there is the prospect of profits, the manipulators will continue to brew up methods to take from the public. How does Wall Street manage to be so coy yet deceiving? They simply employ pure psychological brainwashing. The Wall Street “gang” continues to dream up new ways of extracting profits. Their methods are so subtle and convincing. This is how they control the behavior of the average investor:
1. They create the need for instant gratification, in the form of profits(greed). The use of ads geared toward creating optimism and the need to keep blindly investing. As long as they have you convinced that prices will always rise, then Wall Street will have a steady flow of funds with which to skim from.
2. Brokers and advisers are trained with one thing in mind…get the commission. They are trained in using aggressive tricks in the form of self-serving advice and misleading information. The average investor doesn’t always know the proper questions to ask. Therefore, they usually have no idea they are being misguided.
3. Investors are always guided to seek higher returns. That is the purpose of many ads. Having created this mindset, it is then easy for Wall Street to create all kinds of new fads for investors to chase. Anxious investors always flock to the latest trading gimmicks and offerings. It is similar to the mindset created by the fashion industry. Make them think they always need the latest “whatever”.
4. The majority of Wall Street sponsored education is directly aimed at creating a certain mindset. This promotional information is self-serving as the majority of it is ineffectual and worthless. Do you really think that Wall Street is going to give you the keys to the profit kingdom? That is highly guarded “inside” information. They will provide just enough to keep you coming back for more.
5. Who do you think are the largest donors to the politicians? Wall Street of course. They employ an army of lobbyists and insiders to control Congress and the SEC. The reformulated disclosure rules are just an attempt to appease disgruntled investors. Wall Street pushes laws through Congress to benefit themselves; then spin them as positive developments to the public. To the “gang”, disclosure means tell them anything and they will believe it.
6. Wall Street loves the media. The talking heads spin their dribble all day long to unsuspecting investors. It is totally free advertising. The never-ending parade of specialists on the TV media are the best manipulators yet. The underlying intention is to promote the buy, buy, buy mindset. That fits right in with the strategy of the “gang” on the Street.
7. Believe it or not, they contract some of the best behavioral-science-talent in the country. Wall Street knows exactly how to create the deception needed to psychologically manipulate the investor mind. The “gang” is constantly searching for new technologies based on behavioral science. Think about it. As long as you are able to dominate the investor mind, wouldn’t you seek methods to keep the profits rolling in? The big money is counting on you succumbing to their brainwashing tactics.
As the market’s stand now, it has been over six years since the peak. Wall Street has managed to keep the public mostly involved. The market’s have recovered somewhat from their lows. Some markets, like several of the commodities, have been raging upward for many years. Eventually, these markets will come crashing down as the big boys take their profits. Wall Street continues to beckon the masses with the promise of rising prices. It is the game they play so well, year after year.
What is the average investor to do? Strike out on their own and avoid the Wall Street hype at all costs. With some study and patience, the individual can create methods to trade the markets. By learning to trade, one can become their own “insider”. The trick is to trade against the masses. When you blindly buy and hold, you set yourself up to be taken advantage of by the manipulators. Short-term trading is one way to circumvent the mindless investing that Wall Street programs into your psyche.
This is not day-trading, but shorter term than just holding for years and years. It means buying when few others are and not chasing the latest up-swings. Then, taking profits when they come and not holding on for every last dollar. Using a systematic approach to trading the markets is one way to make profits. Markets will always go up and down. Learn to trade in both directions to beat the manipulators at their own game. It is up to the individual to avoid the brainwashing from Wall Street and think for themselves. If you invest in any market, it is vital to your wealth.
