20 April 2021

Stocks and Precious Metals Charts - Control Frauds and Cryptic Valuations - A Market of Illusions

 

"Control frauds are seemingly legitimate entities controlled by persons that use them as a fraud weapon. A single control fraud can cause greater losses than all other forms of property crime combined.

Financial control frauds’ primary weapon is accounting.  Fraudulent lenders produce exceptional short-term “profits” through a four-part strategy: extreme growth (Ponzi), lending to uncreditworthy borrowers, extreme leverage, and minimal loss reserves. These exceptional profits defeat regulatory restrictions and turn private market discipline perverse. 

The finance sector is most criminogenic because of the absence of effective regulation and the ability to invest in assets that lack readily verifiable values.  Unless regulators deal effectively with the initial frauds their record profits will produce imitators. 

Mega bubbles produce financial crises." 

William K. Black, Recurrent, Intensifying Bubbles and Crises 

 

"Do not be deceived, God is not mocked; for whatever a man sows, that he will reap.  For whoever sows to the flesh will from the flesh reap corruption, but whoever sows to the Spirit will from the Spirit reap everlasting life.  And let us not grow weary while doing good, for in due time we shall reap if we do not lose heart." 

Galatians 6:7-9

 

When we look back on this time with the perspective of history, we will see markets dominated by control frauds and mispricing of risk that will seem painfully obvious. 

Why do we not see this now? 

Why did so few see it in 2007, and 2000? 

Perhaps because the money is too good, and our societal judgement is too corrupted, often willfully so. 

Still, bubbles have a resiliency, as does evil in a hardened heart. 

Have a pleasant evening. 

 

Related:  Trader's Lawsuit Offers Window Into Crime Culture at Bank

 

19 April 2021

Stocks and Precious Metals Charts - Cryptic Valuations and the Bubble From Hell - At the Quiet Limit of the World

 


"Here we may reign secure, and in my choice
to reign is worth ambition though in Hell: 
Better to reign in Hell, than serve in Heaven."

John Milton, Paradise Lost 

 

“Evil when we are in its power is not felt as evil, but as a necessity, or even a duty.   Sin is not a distance, it is a turning of our gaze in the wrong direction.." 

Simone Weil

 

"...old as Babylon, and evil as Hell."

Edward Abbey

 

"Foolishness has a knack of getting its way; as we should see if we were not always so much wrapped up in ourselves.  In this respect our townsfolk were like everybody else, wrapped up in themselves; they did not believe in plagues." 

Albert Camus

 

We are back in a bubble that is strikingly similar in size and sentiment ot the dotcom bubble at the turn of the century. 

This struck me very hard today while I was watching financial tv, and listened to a discussion of the cryptocurrency markets. 

Sometime in the next two years, and with a good probability of later this year, we are going to fall back down into the plunge pool of reality. 

The cynicism with which people approach most things now is almost incredible. 

I am now very alert, and have structured my portfolio and my general life more defensively. 

I have taken most profits.   I employ no leverage.

Am I being overcautious?   Yes I think I probably am.

Especially compared to those who are chasing risks with abandon, and begging to get skinned.

Have a pleasant evening. 

 

16 April 2021

Stocks and Precious Metals Charts - Mavens of Complexity

 

The Lord has told you what is good,
And what it is He requires of you;
Live with justice, love with kindness,
And walk humbly with your God.

Micah 6:20


Like so many things the message to us is clear and simple.

But we like to complicate things, to overwrite creation with our willfulness and pride.

This false complexity is the very hallmark of a fraud.

Interesting stock option expiration.

The lower yield of treasuries has caused the dollar to weaken. 

Gold and silver have run up to key overhead resistance.

They need to go the next step higher in order to confirm a bottom and rally.

We may see some backing and filling, first, and perhaps a test of the precious metals bulls' resolve.

Gold and silver are now trading like currencies.

Have a pleasant weekend.

 

15 April 2021

Stocks and Precious Metals Charts - The Everything Rally

 

“The second factor contributing to speculative euphoria and programmed collapse is the specious association of money and intelligence.

There can be few fields of human endeavor in which history counts for so little as in the world of finance.”

John Kenneth Galbraith, A Short History of Financial Euphoria

 

"I'll give you the bottom 10% and the top 10% of any move if I get to keep the middle 80%." 

Bernard Baruch

 

“Big movements take time to develop.”

Jesse Livermore, Reminiscences of a Stock Operator

 

Stocks were on a tear today with the SP 500 and the Nas100 setting new highs.

The big cap techs were leading the way.

Gold and silver rallied strongly as well, running up to the overhead resistance that marks the top of the current trading range.

The Dollar was off a bit.

Despite very good economic news Treasury yields were off a bit.  

This was the major catalyst for the rally.

Tomorrow will be the option expiration.

Stocks look extended.  They can get even more extended.

Have a pleasant evening