Fund Manager: “Algo’s are Killing the Market”
  • June 16, 2017 04:01 am
  • by Bill Cara

In this important video, Sprott Asset Management portfolio manager Eric Nuttall talks up Oil on BNN, Canada’s high quality TV channel that covers capital markets and financial services, 7×24:

http://beta.bnn.ca/video/oil-bloodbath-overblown-sprott-asset-management~1147528

The headline says Oiler investors should not panic (because the fundamentals are in place even at $50 $WTI). But Nuttall says a lot more if you listen.

http://www.sprott.com/about-sprott/investment-team/eric-nuttall/

Most importantly he says that “Quant Funds” are the source of the problem, causing losses that never in history have happened because today the market is a computer game. Had he acknowledged that central banks and HB&B are the major “Funds” behind this programmed destruction, and that regulators know but are powerless, I might have said he took the script from me.

Nevertheless, this young man should be proud of his TV performance worthy of an Emmy or Golden Globe award.

We should learn something from every crisis or else we never improve, individually or as a society. In this Oil debacle matter, we have learned that programmed trading has overcome industry and corporate fundamentals, so value investing has been reduced to an activity not much different than pulling the lever at a casino slot machine.

Today, these algos have destroyed billions of dollars of investor capital in the Oil market; tomorrow it could be FAANG, as it was for two days this past week, or maybe the next time, the entire market, leading to a global depression.

http://www.marketwatch.com/story/faang-stocks-lose-126-billion-in-market-cap-in-2-days-2017-06-12

Robotic trading. I have been warning people it would come to this.

Lesson #61

Yes, the situation is that serious. Investors are in crisis mode. The rest of the world seems unaware. Something urgently must be do about it.

Unfortunately it is also a matter of Dead Regulators Walking.


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