I have been wondering since mid-October when they were going to give in and do the basic thing one needs to do to stabilize a market – provide a deep-pocketed bid!
In fact, I said it on the Cavuto show and have said many times since, until the Treasury starts bidding for some of these so called toxic assets, the banks would be stuck. It isn’t that I am SO smart – it is just the basic way auction markets work. Buyers bid up and sellers sell – if one of the other is lacking the price just keeping moving into the vacuum left by the lack of buyers or sellers.
It really doesn’t matter if it is on a one minute timeframe in the ES futures or for homes in Las Vegas…. auction markets need bids in order for the prices to stabilize.