Market Conspiracy Theories - A discussion.

I am interested in how much do people believe in conspiracies in markets of the type proposed in the article attached to this discussion? And what type of conspiracies are there out there? Furthermore, I think would be interesting to hear people's thoughts on the psychological aspects of why people are prone to believe or create conspiracy theories.

This discussion was inspired by an interesting post put forward by ‘Trader, Trading and Risk Psychology’ LinkedIn group member Nicholas Santiago who posed the question? 'Why this latest rally is just a scam by the institutions’ the link is: http://www.inthemoneystocks.com/rant-and-rave-blog/item/103848-why-this-latest-rally-is-just-a-scam-by-the-institutions

For my part I am a both cynical and sceptical on the sentiments reflected in this article. I happen to have too much faith in the honesty of people in general, and too little faith in the ability of people to execute such intricate and complex manipulations. Where manipulation, collusion or corruption does it occur, and it does as we all know, I believe it is generally at the margin, with fat cats skimming the cream or froth off the top. I also believe that market manias/crises are not the result of deliberate human rational actions, but the consequence of emotional excesses of our ‘animal spirits’ or economic irrationally.

I will admit I have not been immune to advocating such ‘conspiracy type’ theories in the past. For example in the mid-90s, when I was often on the wrong side of the market and became infuriated at how sharp market drops quickly faded and turned around. I found myself constantly complaining about the actions of the legendary/mythical ‘Plunge Protection Team’.

This discussion is open to the ‘Trader, Trading and Risk Psychology’ group on Linkedin, I look forward to reading some interesting responses:
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