How Constantly 'Doing Something' To Restore Liquidity Destroys Liquidity

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This pattern has happened repeatedly over the last couple of months - every time "The Fed" is uttered on CNBC there's a 1+% spike followed by an instantaneous dump as the market discerns that whatever was announced was total crap, resulting in stops being blown on both sides for traders who held a position with some sort of conviction on a move either way (long or short.) Those traders wind up with a maximum-risk-loss on the trade even if they were right and the market then reverses out from under them.

This is how you destroy market liquidity Ben.

I know that in your ivory tower view all these things mean "you're doing something" and in your view "doing something" means its all working to the good.

Well, you got the "doing something" part right.

What you're doing is trashing any attempt to analyze fundamentals, any attempt to trade on technicals, and any attempt to provide liquidity to the market by churning people's accounts on both the long and short side, creating losses for those traders that should not occur.

These traders then say "screw you" and take their ball (money) and head to The Bar, where they know what the maximum risk is (they'll get drunk and spend $100 on booze) instead of playing in your casino where the rules change literally second-by-second and it is flat-out impossible to trade on any sort of technical or fundamental analysis.

This sort of mouth-breathing crap is a big part of why we had a 20% collapse in days after The House passed your and Hank's bill, and if you don't cut it out you're gonna get another one within days, if you haven't already sown the seeds of that collapse in an irretrievable fashion already...