They are calling it a ‘floor’:

Pakistan set a floor for stock prices on the benchmark exchange, moving to halt a plunge that has wiped out $36.9 billion of market value since April.

Securities can trade within their daily limit of 5 percent “but not below the floor-price level” of yesterday’s close, the exchange said on its Web site, without giving details.

Stocks can no longer go down - it’s the “No Loss Sale Rule“, and not so cleverly disguised. Imagine the order imbalance that would occur in a real marketplace!

Obviously a lot of people do, as do a lot of people’s brokers, who the people, in turn, listen to. And round and round we go.

From eWeek: The stock that bullish analysts on Wall Street said earlier this month was headed soon for $600 turned tail and fell below $400 as the shares suffered their worst day and week of trading since the Web search leader went public in August, 2004.

In just a week, poof! There goes $20 billion.

I was having dinner a few weeks back with an old friend, and the subject turned to the US economic situation. I’ve known this guy for roughly two decades and trust him like a brother; he is a very smart character who doesn’t pull punches. I was inclined to listen - the fact that he analyzes high-yield bonds for a big investment bank’s private client group certainly didn’t hurt his cause either.

I’ve believed that indebtedness at every level of our society, from federal, state and local government, right down to consumers’ credit cards, home equity lines and first mortgages, has reached epic proportions. But when this fellow said he thought we were headed for another depression, my sceptical nature reared its ugly head. I have a predilection for looking at the downside, as I started my career in restructuring situations, but I relish that downside for its opportunity and I also know that nobody likes a doomsayer. It wasn’t until I read about our nation’s savings rate hitting zero that I began to rethink his claim.

Yes, the nation’s savings rate has hit zero, not that anyone should be surprised. We are a consumer society. Our economy is driven by consumer spending. The savings rate has been on decline for some time. And it is now at a level not seen since the Great Depression.

We used to be a manufacturing economy. Then the talk was service economy. Now its consumer economy. What is wrong with this scenario? I heard someone say the other day that the US’s largest export is dollars. With the current account deficit continuing ever upward in mobility, that doesn’t surprise me.

What left me stumped was what anyone can do about it. Seeking bankruptcy protection used to be a way for consumers to clean up their balance sheets, and they have in droves, with the rate of filing more than doubling in the past decade. Many blame skyrocketing health care cost for tipping them over the edge, and I have to agree that a big medical bill can certainly be a “tipping point.” Unfortunately for many, that option is going to disappear very soon. And it is not an option for a global economy like ours.

I’ve also heard chatter about restructuring the tax code to incent savings. I believe that would be a good start, at least for individuals. And rising interest rates are certainly another incentive to save, albeit at the expense of stock market valuations and (potentially) home prices. And there are some economists crying out for accelerated rate increases, and they say that might very well stem the potential of an out and out real estate debacle.

Me…I see a lot of conflicting forces at work. Can you really cut off the finger to save the hand, or are we going to suffer some extreme pain, somewhere, or order to set things right? I simply don’t know, but I would love to hear some ideas.

It is all about the money. And of course, the distribution. We know phishers chase the cold hard cash, so why shouldn’t their slightly less sneaking pure-spam brethren?

You have mortgages, pharma and porn as the norm, but what was once a big deal coming across the fax, is growing again in popularity across the web. Yes, spam-based stock scams are again on the rise.

Could this be a new leading indicator that the stock market is headed north once again?