Market Literacy
123. A bare-bones site to catch you up to speed. ABC.
(TL;DR at the bottom - look for a sunrise/sunset background, above the map)
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Please pardon the wordy, quickly put together website - particularly if you're reading this on a phone. It is not optimized for small screens.
The information here may be new to you at first - naturally being a touch confusing - but it is most certainly directly related to ALL the issues we are facing today.
We must understand Wall Street corruption (and corruptive influence) and associated funding if we are to understand how to address the more widespread corruption we're seeing now.
If you've ever said or heard someone say, "Corporations have too much power!" or "The middle-class is being destroyed!" ... here are cited, tangible, immediate, and main mechanisms around that.
This is financial literacy.
The Jon Stewart segment below starts everything off, is only about 15 minutes long, and - very likely - considerably educational while being an excellent primer for everything that follows.
The episode/segment is primarily about Wall Street, lobbied-for loopholes, criminality, and something called "Payment-for-Order-Flow." To briefly summarize, Payment-for-Order-Flow is a method in which stocks can be bought and sold - with benefits and drawbacks to everyone involved, though some people benefit more than others. To expand, take these two quotes from industry professionals for a better idea of the situation:
"When you place a market order - 90-95% do not go to the 'lit' exchanges - do not go to NASDAQ or NYSE, they go to wholesalers and they don't have order by order competition and part of that is because of what you just said; Payment-for-Order-Flow which is, yes, banned in the U.K., in Canada, and Australia and the European Union..." - Gary Gensler, 33rd Chair of the Securities and Exchange Commission (SEC)
"...stocks that have a high level of retail participation, the vast majority of order flow can trade off of exchanges, which is problematic. That price formation is not really reflective of what supply and demand is." - Stacey Cunningham, President of New York Stock Exchange (NYSE)
With Payment-for-Order-Flow (PFoF), the very most basic foundation of much of the stock market and free market is rendered utterly meaningless. If the heart of "the stock market" and a "free market" is supply and demand, then PFoF could be argued to be something akin to heart disease.
Next piece of pertinent information...
... an article from Bloomberg Markets from 2005, though still eminently relevant. This article is difficult to find and is sourced from the Wayback Archive ...
Via Bloomberg Markets:
In a little-known quirk of Wall Street bookkeeping, when brokerages loan out a customer’s stock to short sellers and those traders sell the stock to someone else, both investors are often able to vote in corporate elections.
With the growth of short sales, which involve the resale of borrowed securities, stocks can be lent repeatedly, allowing three or four owners [or more] to cast votes based on holdings of the same shares.
The Hazlet, New Jersey–based Securities Transfer Association, a trade group for stock transfer agents, reviewed 341 shareholder
votes in corporate contests in 2005. It found evidence of overvoting—the submission of too many ballots—in all 341 cases.
(emphasis added)
You're encouraged to read those three paragraphs again and ruminate on what that may entail.
[Citation: False Proxies by Bob Drummond, Bloomberg Markets; alternative source here.]
George Carlin in Dogma
The lobbied-for loopholes related to corporate voting undermine the most basic and foundational elements of democracy and voting - both in business terms, as well as nation-state terms - particularly if government can be influenced by corporations.
Do you live in a country where corporations influence government?
If so, this is vital information in order to address potential and real corruption, fraud, and a breakdown of government.
Shareholders and the associated corporations/companies can be taken over / misguided / misled / duped by way of sham voting via short-selling and the subsequent counterfeit/phantom shares - where and when elections may result in highly questionable policies/decisions implemented, as well as an installation of corrupt officials & board members, resulting in dubious business-practices wherein ulterior motives are rampant, along with the potential creation of a lobbying, bribing, and (frankly) psychopathic organization.
Indeed, that's what has been happening.
When we hear talk about "corporations having too much power!" - this is one of the main mechanisms making that possible.
In one of the latest tallies in 2018, there were 134 instances of overvoting, equating to 5.9 million votes being discarded and not counted.
[Citation: Letter from Securities Transfer Association (STA) to Securities Exchange Commission (SEC) (page 3)]
"We've seen problems which came really to the fore, particularly with Procter and Gamble's proxy fight, which nobody really knows what the outcome was. There were enough "hanging-chads," so-to-speak, that that was never really resolved." [source]
See primary research on the subject here: "The New Vote Buying: Empty Voting and Hidden (Morphable) Ownership"
Onwards, bravely...
If you buy a car in full, you get a title with your name on it. Not so with stock/shares - contrary to popular belief.
What you get is an I.O.U. Shares you purchase through a brokerage are not, technically, yours - your name is not on them - you do not own them... and that has has serious ramifications. In short, you have access to them, which entails buying/selling/etc..., but you are not the true owner. Someone else is the owner (Cede And Company) and that equates to other people/organizations/companies potentially using "your" shares - legally and illegally - without your knowledge.
It would be as if you bought a car in full, paid in cash, but the dealership keeps the title, and then at night they take your car and use it for joyriding, taxiing, rentals, and more - putting miles on it and even damaging it - then laughing in your face upon confrontation.
Once again, I'm asking you to understand...
If you purchase shares with a brokerage and/or have a retirement fund, the shares you think you own are not actually yours. You are a beneficial holder, not a share holder. They are not in your name and are not, technically nor figuratively, owned by you. Perhaps hard to believe, but the unadulterated truth nonetheless.
More to the point: shares, if not in your own name, are are, very, very, very, very likely, being used against you in convoluted schemes similar to the 2008 Housing Derivative Meltdown - same sort of derivative-based shell-game & dishonesty, but with slightly different financial instruments, using more techniques of deception - made possible through 1) Wall Street lobbying & associated loopholes ... 2) asymmetrical information access & gathering ... 3) grey area insider trading ... 4) expensive subscription data services ... 5) raw market manipulation ... 6) sheer illegality and criminal action ... and more.
An analogy (again):
It would be as if you bought a car in full, paid in cash, but the dealership keeps the title, and then at night, they take your car and use it for joyriding, taxiing, rentals, and more - putting miles on it and even damaging it - then laughing in your face upon confrontation.
It's criminal, at the end of the day. That's not new, though, when it comes to much of Wall Street. Habitual criminality is a main-stay and even encouraged and fostered in much of the financial industry.
Again, when we hear talk about "corporations having too much power!" - this is another mechanism (lack of true ownership of shares/stock by retail purchasers) making that possible. Particularly when coupled with the above elucidated "phantom share" creation and shareholder voting.
Bernie Madoff
Importantly and a main impetus for this site existing is this: you can insure shares are in your own name using the SEC sanctioned Direct Registration System which legally must be processed when requested - by you. Again, just so we're clear, if shares are held in a brokerage, they are NOT in your name and you do not own them, unequivocally. You must use the DRS if you want the protection afforded by such status.
By "DRSing" your shares they are then placed in your name and are now truly owned by you - such that they can't be used against you in classic Wall Street corruption, loophole abuse, and confidence trickery.
This website talks more about the DRS at length, as does this website. Both are well-worth the time to peruse - there is a huge amount of value in both sites.
TL;DR:
If you hold stock with a broker or retirement fund you DO NOT legally own those shares. Full stop. Such holding is known as “street name registration” and it denies you critical property rights over your investments. See this bulletin, dated July 12, 2023, direct from the Securities and Exchange Commission (SEC). You can also read more here and here. Additionally, here.
When we hear talk about "corporations having too much power!" - this is the heart of the matter, particularly when tied to shareholder voting, making it possible to create "phantom shares" via legal and illegal financial derivatives to drastically alter voting results including specific issues, company executive leadership, and even board members.
You wouldn’t leave the bank on the deed to your house after paying off the mortgage - and allow them to modify/rent the basement out and not give you a cut. Would you? This is no different at the end of the day.
You wouldn't allow the car dealership to keep the title to your car after paying it off - and then allow them to use it at night as an Uber/Lyft/etc...driver, would you?
If shares are held with a brokerage/fund manager (i.e. legally not in your name) - someone/thing else is the owner (Cede And Company) - which equates to other people/organizations/companies potentially using "your" shares, legally and illegally, without your knowledge.
The only option to truly own shares is through the Direct Registration System and is endorsed by the Securities and Exchange Commission (SEC). See #1 above for more citations/links on the matter.
Registering stock via the DRS is easy. The DRS is the only way to have your shares - your "stock" - in your name and your name only.
Protect your family and investments by calling your financial advisor and visiting WhyDRS.org - a not-for-profit and non-monetized educational resource.
A case study and example...
Forget about Gamestop. There's nothing to see here. Move along. Nothing to see here.
(Narrator: There was something to see there.)
You are encouraged to protect yourself using the information presented here. The Self-Regulatory Organizations (SROs) throughout the broader stock market - ("We investigated ourselves and found no wrongdoing!") - such as the Financial Industry Regulatory Authority, Inc. (FINRA) and the New York Stock Exchange (NYSE), as well as the Depository Trust and Clearing Corporation (DTCC; i.e. "Cede & Co."), will not and do not have your best interest at heart. The money gained through both the legal loopholes and sheer illegal criminality is being used to fund dubious and criminal organizations and people. You are being backstabbed, whether you own stocks/securities or not. Now's our chance to turn around and defend ourselves.
This website is dedicated to education and market literacy. Nothing here should be taken as financial advice.
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