Talk about throwing a fit. The stock market action on Monday seemed like a toddler in throws of a tantrum. The Dow plunged by triple digits and oil surged higher in its biggest one-day jump ever.
“I think there are so few players in the market you can squeeze the shorts just as hard as you can” and get away with it, muses Jon Najarian about the spike in oil.
In other words Najarian feels there are too few people to take the other side of the oil trade. “I’m seeing 50% to 70% of normal volume because of the short selling ban.”
“Why would you put yourself in front of this bus,” he says “not knowing what they’re going to throw in front of us.”
As you probably know, too few participants in a market can lead to violent swings or funky market action. That’s the kind of thing you sometimes see Christmas week because so many people are away.
Better fasten your seatbelt. The dynamic seems unlikely to change until October 2nd, the day the ban expires.”
“We’ve basically just been watching Rome burn and then building larger houses out of sticks. The government has to get something done and the market’s move on Monday suggests to me there are doubts that it gets done this week.”
Should be interesting.
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