10 Ways Banks Are Manipulating Investors

Seen on MarketWatch by Paul Farrell, some points are interesting while others may be a little bit on the paranoia end.

1. Hire psychologists, neuroscientists to manipulate the media

Use consulting contracts, grants and retainers and lock up the best talent to work to keep America’s 95 million individual investors “irrational and uninformed” as Thaler says.

2. Free experts constantly deliver Wall Street’s message to media

Network, cable, bloggers must fill their channels every day. Talking heads are free advertising for Wall Street to manipulate investors using so-called news content.

3. Invest megabucks on lobbyists to control politicians, government

Lobbying is one of Wall Street’s best investments. Lobbyists control Washington: control politicians, fight reforms, push favorable laws, regs, spin the truth to mislead investors.

4. Fuel anxiety by pushing the investor’s buy/sell/ trade button

Wall Street’s a casino, makes money on “the action,” skimming a percentage off the top. They fuel investor anxieties, fears, optimism, volatility, maximize action on exchanges.

5. Kill our savings button, undercut self-confidence, long-term planning

Wall Street uses neuroscience technology to sow doubts about retirement security, do-it-yourself investing, how indexing beats trading, then overloads us with misleading ads.

6. High-frequency trading, misleading Wall Street and Main Street

Short-term online trading makes Wall Street billions annually. Hyperactive traders have a competitive edge using high-tech neuroscientific strategies, plus keep markets churning.

7. Brokers trained on aggressive selling and closing techniques

Securities are sold not bought: Broker’s advice is self-serving, often misleading, anything to get a commission. They’re trained to use high-powered psychological techniques.

8. ‘Investor education’ programs are self-serving sales gimmicks

Most Wall Street-sponsored “investor education” programs are loaded with new business, sales and promotional gimmicks. But they help Wall Street present a “we care” persona.

9. New ‘designer’ funds based on latest fads to replace losers

Fund companies constantly design new funds based on the latest fads, for anxious investors chasing higher returns, driven like teenagers who need the latest video games.

10. Retirement gatekeepers: kept in the dark and manipulated

Two-thirds of all funds are controlled by corporate pension and retirement managers. So Wall Street focuses sales pitches on easy to manipulate naïve plan managers.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Mingze Wu

Mingze Wu

Currency Analyst at Market Pulse
Based in Singapore, Mingze Wu focuses on trading strategies and technical and fundamental analysis of major currency pairs. He has extensive trading experience across different asset classes and is well-versed in global market fundamentals. In addition to contributing articles to MarketPulseFX, Mingze centers on forex and macro-economic trends impacting the Asia Pacific region.
Mingze Wu