If the pe ratio ought to be 20s from the current 90s, (meaning the price of the company, it would take 90 years to earn it all back, as a result, lending to Greece is more than justificable) then actually, TZA ought to be around $40 despite the so called fake idea of a daily reset for tza. Can't imagine how a pe ratio like this can continue, except in the mind of a trader who justifies by algorithm, rather than have a fundamental thing like pe ratio programmed into the algorithm.
Printing money to prevent bears from making money? Why invest further in the russell when the p/e ratios are such that it would be a truly amazing company to make the next reconstitution? To bail out the positions at this unrealistic level?
Isn't it like trying to fill a pail that its hole is getting bigger and bigger? The reason why banks were not allowed to trade depositors money was to ensure savers money. It is necessary for all banks money to be secured, and allowing banks to play leveraged games with depositors money, subsequently allowing central banks to take over unmanageable positions, like now, which is the likely explanation for the behaviour of the indices, what is the sense?
Unless the price earnings ratios of the russell companies are realistic, the manipulation is only an arithmetic programming game of printing money in a ledger to make it such that bears lose at this level. But what is the consequence of this unrealistic price earnings ratio?
The consequence is likely to be the erosion of the value of a dollar. The dollar will simply be able to buy less than it did. This is called hyperinflation isn't it? And a loss of belief in the dollar is the destruction of any weimar, resulting in any militant group espousing violence to get people to work succeeding.
Thatcher said that socialism is spending money that belongs to other people.
QE is spending money that belongs to the people by virtue of the devalued purchasing power.
A market is good at removing unproductive producers. manipulating a market is removing bears who may be deemed unproductive, but supporting unproductive price earnings ratios makes one wonder who the real heroes are, maybe the bears, actually.
The market ought to be allowed to function. Manipulation of price is counter-productive to the real economy. QE has become the tool of the bad guys.