Courtesy of an observation by Nanex's Eric Hunsader, we now know, with certainty and beyond merely speculation by tinfoil fringe blogs, that central banks around the world trade (and by "trade" we mean buy) S&P 500 futures such as the E-mini, in both futures and option form, as well as full size, and micro versions, in addition to the well-known central bank trading in Interest Rates, TSY and FX products. In fact, central banks are such active traders, that the CME Globex has its own "Central Bank Incentive Program", designed to "incentivize" central banks to provide market liquidity, i.e., limit orders, by paying them (!) tiny rebates on every trade. Because central banks can't just print whatever money they need, apparently they need the CME to pay them to trade. http://www.zerohedge.com/news/2014-08-30/its-settled-central-banks-trade-sp500-futures
I think that things like this aren't necessarily bad. Moving more money around makes it easier for smaller traders to trade and also allows more liquidity for stocks. I think this provides a big advantage over stocks not moving around much at all because their is not enough money to trade. However, I don't think that they should be getting paid in order to trade.
