Months ago I saw a rumor that some crooked billionaires had worked out a scheme to profit from a stock market crash. At the time I thought it must be just an urban legend. No one could be so stupid as to try to crash the stock market, particularly while the nation is at war. Now I'm not so sure it's just an urban legend.
Ron Paul and other hucksters are advertising that we should follow
their advice to avoid the economic debacle they claim is
coming. Someone needs to tell these dopes that if they
succeed in causing an economic panic they could face prison or
The United States is in a war with the terrorist groups al Qaeda and
ISIS. Wars are not just fought with bullets and
bombs. Damaging an enemy's economy can also be a weapon of
Al Qeada's 9/11 attack didn't just kill people. It temporarily
damaged the U.S. economy. Terrorist groups could use a
major American economic calamity as evidence that the United States
is finished and they are going to win. Such a claim
could be a powerful recruiting tool.
If people were to cause a stock market crash, they would in effect
be "giving aid and comfort to the enemy"(i.e., committing
Stock market "panics" are as much, if not more, psychological events
rather than economic events. Getting people to believe a
crash will occur can be a deliberate attempt to cause the
crash. Predicting a crash can be a self-fulfilling prophecy.
In time of war an American President such as Barack Obama could
charge those involved in crashing the market with treason regardless
of whether they were motivated by greed or actually wanted to help
an enemy of the United States. Action might involve more
than just criminal prosecution. If individuals are
"giving aid to an enemy", government could convince the courts to
allow confiscation of their economic assets to prevent the assets
from being transferred to the enemy.
Spreading rumors of imminent stock market crashes can be considered
the equivalent of yelling fire in a crowded theater and the United
States Supreme Court has said yelling fire in a theater is not
protected by the first amendment. This fact means
that any television station, newspaper, online media site,
etc. that provides a forum for spreading such rumors could be
prosecuted as a "co-conspirator".
Congress needs to examine this situation to see if legislation is
needed to discourage any economic problems or to provide additional
grounds for prosecution.