2011-08-25 — zerohedge.com
"Societe Generale SA, whose shares have come under severe pressure in recent weeks, said Tuesday that it had signed a liquidity contract with Rothschild & Cie. to prevent excessive volatility in its stock price." That's right: Rothschild is now in the Plunge Protection business.
Rothschild claims they are not going to prop the stock, but only to "smooth out the volatility". That should be little consolation, given that the natural volatility of a stock is a major factor in determining if it should be held... i.e. by widows and orphans and pension funds. So this simply adds to the great moral hazard constructed in recent years by getting the general public to buy into stocks as "safe".
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