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Strategies & Market Trends : The Stock Market Bubble -- Ignore unavailable to you. Want to Upgrade?

To: Michael Collings who wrote (3069)	2/25/2000 8:56:00 PM
From: RockyBalboa	Read Replies (1) \| Respond to of 3339

Want to contradict here. The Nasdaq is not liquid, the Nasdaq is not liquid. Say it again and again. Nasdaq market makers are not required to make a market and therefore the Nasdaq market is not liquid. You may be right, in single stock breakdowns, like SAWS or ITWO today there is real a lack of buyers, and MMs are no samaritans, I tend to agree. And short sellers are very smart in buying back shares. The NYSE is not different. Not the slightest. You may have a "specialist" who handles the orders, matches trades etc. But then you have nearly the same logistics behind. Institutions desiring to sell off or buy some bigger positions. Sometimes whatever the price is. Check out the fall of UIS in October - read the time & sales (including bids/asks) and tell me where the liquidity is. For me it was clear, a no no to buy for quite a time because there was no bid - there was a 100 shares bid displayed, but presumably between 2 and 5 Million shares behind the ask. Then you see a combo of low bid hits and upticked bids for a block or 2. But they were used for continued shortselling, clearly. You are correct that the specialist makes a sort of market. But he is dependant on client orders. And moreover, he has even more information about pending asks, and he knows very well when he buys for his own accounts...

To: Michael Collings who wrote (3069)	2/26/2000 1:10:00 PM
From: Mama Bear	Read Replies (1) \| Respond to of 3339

Michael, there are two things present in today's Nasdaq market that are different than in 1987. These are ECN's and the Manning rules. Both of these allow trades to cross between willing buyer and seller. ECN's have no reason to stand aside as they take no market risk. The Manning rules are what allow the average retail investor to buy on the bid and sell on the offer. Of course there does have to be a willing trader on the other side before a trade is crossed, but I doubt we will see many buy at market orders going unmet in the event of a meltdown. Regards, Barb