Stocks and Precious Metals Charts - A Mighty Bubble of Stolen Wealth

 

“A mighty bubble of wealth is blown before our eyes, as empty, as transient, as contradictory to the laws of solid material, as confuted by every circumstance of actual condition, as any other bubble which man or child ever blew before.”

Edward Chancellor, Devil Take the Hindmost, 1999

"Over the past 30 years the plutocrats have used their vastly increased wealth to capture the flag and assure the government does their bidding. This marriage of money and politics has produced an America of gross inequality at the top and low social mobility at the bottom, with little but anxiety and dread in between, as middle class Americans feel the ground falling out from under their feet.

Like those populists of that earlier era, millions of Americans have awakened to a sobering reality: they live in a plutocracy, where they are disposable. Then, the remedy was a popular insurgency that ignited the spark of democracy. Now we have come to another parting of the ways, and once again the fate and character of our country are up for grabs."

Bill Moyers, last episode of Bill Moyers Journal, 30 April 2010

"Our plutocracy, whether the hedge fund managers in Greenwich, Connecticut, or the Internet moguls in Palo Alto, now lives like the British did in colonial India: ruling the place but not of it."

Mike Lofgren, The Deep State, 5 January 2016

"Special privileges and the use of the taxing power for private gain, these are the twin pillars upon which plutocracy rests. Accumulating by conscious frauds more money than they can use upon themselves, wisely distribute or safely leave to their children, these denounce as public enemies all who question their methods or throw a light upon their crimes.

Plutocracy is abhorrent to a republic; it is more despotic than monarchy, more heartless than aristocracy, more selfish than bureaucracy. It preys upon the nation in time of peace and conspires against it in the hour of its calamity. Conscienceless, compassionless and devoid of wisdom, it enervates its votaries while it impoverishes its victims."

William Jennings Bryan, Speech at Madison Square Garden, 30 August 1906

"For they sanctify the power of markets in the name of economic efficiency, which requires the elimination of administrative or political barriers capable of inconveniencing the owners of capital in their individual quest for the maximisation of individual profit, which has been turned into a model of rationality. They want independent central banks.

And they preach the subordination of nation-states to the requirements of economic freedom for the masters of the economy, with the suppression of any regulation of any market, beginning with the labour market, the prohibition of deficits and inflation, the general privatisation of public services, and the reduction of public and social expenses.

And yet the world is there, with the immediately visible effects of the implementation of the great neoliberal utopia: not only the poverty of an increasingly large segment of the most economically advanced societies, the extraordinary growth in income differences, the progressive disappearance of autonomous universes of cultural production, such as film, publishing, etc. through the intrusive imposition of commercial values, but also and above all two major trends.

First is the destruction of all the collective institutions capable of counteracting the effects of the infernal machine, primarily those of the state, repository of all of the universal values associated with the idea of the public realm. Second is the imposition everywhere, in the upper spheres of the economy and the state as at the heart of corporations, of that sort of moral Darwinism that, with the cult of the winner, schooled in higher mathematics and bungee jumping, institutes the struggle of all against all and cynicism as the norm of all action and behaviour."

Pierre Bourdieu, L’essence du néolibéralisme, (en français), December 1998

Stocks slumped again today despite an early afternoon attempt to take the major indices green.

Gold and silver were slammed lower.

The Dollar grabbed the 99 handle.  It is still chopping within a relatively narrow range however.

VIX wallowed in near complacency, as it is often wont to do.

Bitcoin is hanging on to support a little north of 76k.

The markets seem quiet.   Not in a peaceful way, but in anticipation of an outbreak of uncertainty.

Have a pleasant evening. 

Stocks and Precious Metals Charts - The Limit of Tyrants

 

"If the moderates fail to act now, history will have to record that the greatest tragedy of this period of social transition was not the strident clamor of the bad people, but the appalling silence of the good people.  Our generation will have to repent not only for the acts and words of the children of darkness but also for the fears and apathy of the children of light."

Martin Luther King, Stride Toward Freedom, 1958

"It was true, the bill was said to be founded on necessity; but what was this?  Was it not necessity, which had always been the plea of every illegal exertion of power, or exercise of oppression?  Was not necessity the pretence of every usurpation?  Necessity is the plea for every infringement of human freedom.  It is the argument of tyrants; it is the creed of slaves."

William Pitt, Speech, House of Commons, 18 November 1783

"Find out just what any people will quietly submit to and you have found out the exact measure of injustice and wrong which will be imposed upon them, and these will continue till they are resisted with either words or blows, or with both.  The limits of tyrants are prescribed by the endurance of those whom they oppress."

Frederick Douglass, Emancipation, August 3, 1857

"The liberties of our country are worth defending at all hazards; it is our duty to defend them against all attacks. We have received them as a fair inheritance from our worthy ancestors. They purchased them for us with toil and danger and expense of treasure and blood. It will bring a mark of everlasting infamy on the present generation – enlightened as it is – if we should suffer them to be wrested from us by violence without a struggle, or to be cheated out of them by the artifices of designing men."

Samuel Adams, Article Signed 'Candidus,' The Boston Gazette, October 14, 1771

"American political corruption was the buying up of legislatures and assemblies to keep them from doing the people's will and protecting the people's interests; it was the exploiter entrenching himself in power, it was financial autocracy undermining and destroying political democracy.  By the blindness and greed of ruling classes the people have been plunged into infinite misery; but that misery has its purpose in the scheme of nature.  Something more than a century ago we saw the people driven by just such misery to grope their way into a new order of society; they threw off the chains of hereditary monarchy, and made themselves citizens of free republics."

Upton Sinclair, The Brass Check, 1919

"God has a way of standing before the nations with justice and it seems I can hear God saying to America 'you are too arrogant, and if you don't change your ways, I will rise up and break the backbone of your power, and I will place it in the hands of a nation that doesn't even know my name.  Be still and know that I'm God.'"

Martin Luther King, Why I Am Opposed to the War, Ebenezer Baptist Church, April 30, 1967

I may be wrong, but it appears to me that the US stock market is overdue for a significant correction.

The first chart below shows that margin debt is now at a record. 

Stocks dipped, but came back a bit in the final hours after Europe went home to bed.

This is becoming a familiar pattern.

I had thought that Bessent et al. were pumping the equity market to make the Administration look good.

But as it turns out, the President, and most likely his sycophants, are day-trading stocks, and in some case blatantly front running their own statements.  

I have never seen anything like it, and I have seen quite a bit of corruption in my 70+ years.

Gold and silver took a hit in the early trading, but recovered for gains by the end of the day, again.

VIX declined.

The Dollar is in a fairly narrow trading range.  A longer term view, as is shown below, makes the wiggles fit into a fairly sensible picture of 'maintenance.'

People are preoccupied with Iran, but the war between Ukraine and Russia is heating up.  And it is a powder keg.

Trump issued a statement saying that he has called off the planning military action against Iran for Tuesday, based on request from his Gulf partners.

I think they said they would not permit the US to use its bases in their countries, knowing that a devastating counterattack on their own infrastructure was likely.

Donny is caught in a bit of a stalemate.  And he and his outsized ego are obviously not happy.

"So, what happens in the end?  Difficult to predict.  Each circumstance is different... Others, unfortunately, will seek to do harm as they face a breakup, a divorce, are fired from a job, are outed for their crimes, or are removed from office."   Joe Navarro, When Narcissists Fail

Let's see what the rest of this week brings.

There is still time to stock up on essentials that may enter soon enough into short supply, but the window appears to be closing. 

Have a pleasant evening.

Stocks and Precious Metals Charts - The Poverty of the Faithful Remnant

 

"To experience means to know facts just as they are, to know in accordance with facts by completely relinquishing one's own fabrications. By pure I am referring to the state of experience just as it is without the least addition of deliberative discrimination.

God is not something that transcends reality, God is the base of reality. God is that which dissolves the distinction between subjectivity and objectivity and unites spirit and nature."

Kitarō Nishida, An Inquiry Into the Good, 1911

“Having found this refuge, the intellect begins to confine itself within the walls of its own beliefs.  In doing so, it constructs an internal framework that conceals and hollows out a more expansive awareness of the mind as a whole.  When this occurs, an incomplete self-awakening — rooted in unawakened ignorance and lacking true awareness — becomes a pitfall. 

Behind the radiance of a self-awakening that has supposedly reached a higher plane, the darkness of ignorance persists in an even deeper form.  Behind the certainty of, and belief in, one’s inner truth, the dark shadow of delusion lingers.”

Nishitani Keiji, The Cold Mountain Poems, trans. Norman Waddell, 2026

"Religion without philosophy is blind; philosophy without religion is vacuous. Philosophy seeks to know the ultimate; religion seeks to live it. Yet for the whole human being, the two must be nondualistically of one body, and cannot be divided. If religion is isolated from philosophy, it falls into ignorance, superstition, fanaticism, or dogmatics. If philosophy is alienated from religion, it loses nothing less than its life."

Hisamatsu Shin'ichi, Collected Works, Tokyo, 1971

"To be enlightened by all things is to cast off the body and mind of yourself as well as all others. No trace of realization remains, and this traceless enlightenment continues on and on endlessly."

Dōgen Zenji, Genjōkōan: Shōbōgenzō, 1233

"True poverty is a state of spiritual nakedness, a total detachment from all self-righteousness, all spiritual security, all claims to merit or holiness.  It is a state of absolute dependence upon God, in which the soul, having lost everything, possesses everything in Him.  It is here, in this poverty, that man regains the eternal being that once he was, now is and evermore shall be.  This is the poverty of the anawim, the poor of Yahweh, who have nothing but their trust in His mercy."

Thomas Merton, Zen and the Birds of Appetite, 1968

Stocks dumped today in the disappointment following the Trump-Xi Summit, in which no magic solutions to Trump's dilemma with his misconceived Mideast adventures were provided.

Today was the monthly stock market option expiration. The next month's expiration is a triple witch. 

VIX ticked up to the longer term moving average, but it remains subdued, all things considered.

The Dollar rallied back to the top of its intermediate trading range.

Bitcoin dumped, but is still bouncing around at overhead resistance.  I have included a chart that shows this more clearly.

Gold and silver were hit with selling, with silver just getting hammered.  Boys will be boys.

The first chart below reveals how the broader market showed signs of an impending top and decliner well in advance of the 'meme stocks' of The Great Crash of 1929.

Breadth is a crossmarket indicator that seasoned traders will always keep in mind.

If not the NYSE Advance-Decline indicator, one may also keep an eye on the broader indices when a market is floating higher on narrowing leadership.  As we see today.

In the 'Financial Panic' of 2007-2008, the SP 500 made its peak bubble top on October 9.  But the Russell 2000 reached its peak on July 13.  It had already fallen over 10% by the time the financial bubble stocks were topping.

Who could have seen it coming?   If their eyes were closed, they did not.

Bubbles are difficult.  The 'enthusiasm' is infectious, and the relentless push higher inclines people to believe that it will keep going, and going, and going.  And if not, they think they will be able to get out in time.

The Tech Bubble of 2000-2002 was essentially the same with the NDX being the lead sled dog.

There is a little bit of a difference now.  The great bamboozle is being more aggressively and openly supported by the insider traders from the political world, with their acolytes and enablers.

You have to wonder if they were dumping their positions ahead of some event planned for the weekend. This is why it is hard to 'think like a criminal.'  They are not rational, and act not out of their own will but in obedience to the powers of the world. 

They think they would be as gods.  Even as they slide with arrogant indifference into the abyss.

Need little, want less, love more.  For those who abide in love abide in God, and God in them.  

Have a pleasant weekend.

Stocks and Precious Metals Charts - Change Forged in Misery and Blood

 

"The only resource against political disorders that had been known till then was the concentration of power. Solon undertook to effect the same object by the distribution of power.  He gave to the common people as much influence as he thought them able to employ, that the State might be exempt from arbitrary government.  It is the essence of Democracy, he said, to obey no master but the law.  Solon recognised the principle that political forms are not final or inviolable, and must adapt themselves to facts; and he provided so well for the revision of his constitution, without breach of continuity or loss of stability."

John Dalberg Lord Acton, History of Freedom in Antiquity, 1877

"Gold does have some remarkable qualities that make it quite suitable for use as money.  No one can create it, it is enduring, and relatively stable in terms of growth.  As an external standard it is almost ideal.  There is little wonder that diverse societies have gravitated towards gold and things like it down the long corridor of time.  And yet it does have one drawback: gold alone cannot enforce honesty on a corrupted system.  The recent growth on paper of the rehypothecated gold supply is one case in point.

There is no secret to creating a workable system.  I know I could do it, and many other people could so as well and perhaps much better.  The problem is that people with power do not wish to have a good system.

There will be no good and sustainable monetary system easily reached for the same reasons that this generation of leaders can no longer create and put forward fair and workable laws for their own country.  They are overcome by ego and greed.  They wish for a system riddled with loopholes and personal advantage for them and their friends.  So this is what is produced.  And until this changes, progress and change will be spattered with misery and blood, as it has so often been in the past.

If there is any key point I wish you to take and hold in your minds and hearts it is that there is no such thing as a perfect, self-regulating monetary system.  There could only be such an ideal model if men and women were angels, perfectly rational and reliably virtuous.

And like wealth, the distribution of reason and virtue is very uneven, and so all systems must rely on a continuing effort and bias towards equal justice for all.  And this has inescapable requirements for the design of the system.  Among these are transparency and the rule of law.  And the assumption that there will always be those who will be actively attempting to subvert the system, some bluntly, and some quite cleverly. So there must be a mechanism for administering justice, for all.

Money is power, and power corrupts.  No system can succeed by its own design if its reins are held in the hands of mortal people, with all their weaknesses and failings.  So the system must account for this, and accommodate change and judgement, as well as the balance of justice.

This was the great innovation of the US Constitution, the balance of power and its ability to change and evolve through law, with its commitment to justice and equality as an ideal, integrated into its construction, even though imperfectly by imperfect men of their time. This is what made it such a bright star on the darkened horizon of human endeavour, a hymn to human freedom. And look what they've done to our song.

It will be fascinating to see how this evolves. Will we see the creation of an SDR like monetary instrument based on a basket of items and currencies not under the control of a single power bloc?

Will the world evolve into three or four powerful trading blocs, each with their own currency arrangements?  Will the current dollar hegemony continue on until it collapses, and then what could have been an evolution will be a more sudden monetary revolution in which great wealth is destroyed, transferred and created anew?

We live in interesting times. And inescapably, these questions are now being addressed in the ongoing struggle for monetary power, in what some have called the currency wars."

Jesse, Currency Wars, 9 September 2013

"How long can the US government protect the dollar’s value by leasing its gold to bullion dealers who sell it, thereby holding down the gold price?  Given the incompetence in Washington and on Wall Street, our best hope is that the rest of the world is even less competent and even in deeper trouble.  In this event, the US dollar might survive as the least valueless of the world’s fiat currencies."

Paul Craig Roberts, The Golden Rule, Daily Kos, 19 May 2009

"The vast majority of privately negotiated OTC contracts are settled in cash rather than through delivery. Cash settlement typically is based on a rate or price in a highly liquid market with a very large or virtually unlimited deliverable supply, for example, LIBOR or the spot dollar-yen exchange rate. To be sure, there are a limited number of OTC derivative contracts that apply to nonfinancial underlying assets.

There is a significant business in oil-based derivatives, for example. But unlike farm crops, especially near the end of a crop season, private counterparties in oil contracts have virtually no ability to restrict the worldwide supply of this commodity.  Nor can private counterparties restrict supplies of gold, another commodity whose derivatives are often traded over-the-counter, where central banks stand ready to lease gold in increasing quantities should the price rise."

Alan Greenspan, Testimony to Congress, July 24, 1998

We are now dealing with people in positions of power who are lawless, and have demonstrated that no crime, no matter how horrific or dishonorable, is beyond them.  And they have no shame, and believe that they will never be held to account for their transgressions.  This is the fruition of moral hazard.

Change is coming, slowly.  And those who have served their basest desires and wickedness in high places, for many, many years, will not accept that change quietly. 

This is the lesson from history.

Global automotive giant Honda has reportedly posted an annual loss for the first time in 70 years.

Stocks shook off geopolitical tremors and awful inflation numbers and extended their rally.

Bitcoin jumped higher in the last hour of trading.   I am now more convinced than ever that it is a control fraud that will end in misery, but only after it has been used by unscrupulous people to add to their wealth.

The Dollar rallied.  Gold and silver were smacked lower.

Never forget this is a currency war, and the US and the BRICs are at the epicenter of it.

VIX is once again supine.  The mispricing of risk is a key element of any financial asset bubble.  

I am not going to try and convince anyone of anything.   There is no sense talking with people given over to madness, and those determined to be rich through extraordinary means. 

As always, people are free to serve whom and what that they wish.

Free to follow and serve their idols, even into the abyss.  And many will.

This is the lesson from history.

But for many of us, the challenge is to be a Christian, and remain standing in faith in an increase of lawlessness. 

Have a pleasant evening.