13 December 2017

Stocks and Precious Metals Charts - Janet and Her FOMC Financial Asset Bubble Makers

“Let us not, in the pride of our superior knowledge, turn with contempt from the follies of our predecessors. The study of the errors into which great minds have fallen in the pursuit of truth can never be uninstructive. As the man looks back to the days of his childhood and his youth, and recalls to his mind the strange notions and false opinions that swayed his actions at the time, that he may wonder at them; so should society, for its edification, look back to the opinions which governed ages that fled...

Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, one by one.”

Charles Mackay

“The primary purposes of the political pamphlets of the early 1700s were neither to enlighten nor educate the masses, but to incite partisan conversation and spread commensurate ideas.   Facts were not permitted to fetter the views they espoused, and the restraints of objective journalistic credibility were discarded by pamphleteers bent on promoting subjective slant to an insatiable general public for whom political dissonance was an integral part of social interaction.”

Gavin John Adams, Letters to John Law

Knowledge without the wisdom that is hammered out of it by experience is a very dangerous thing.

Today was likely to be Janet Yellen's last FOMC meeting as the Chairperson.

The Fed raised their key interest rate by 25 basis points.

Chair Yellen has agreed to resign when her successor, Jay Powell, is approved by the Senate.

And so task of tending to the third post-regulatory asset bubble is passing from Janet to Jay, as its forebears had passed from Alan to Ben.

Janet said that the Fed is not interested in pursuing anything to do with Bitcoin, but the central banks of the world are actively investigating their own forms of digital currencies.  I am sure that this will not turn out badly for the general public.  (/sarc).

Perhaps they can create, issue, and hold our digits in their banking system for us.  And we can tattoo, figuratively speaking, our digital money accounts on our hands, for the purpose of buying and selling, all of it recorded in one great ledger.  And if you misbehave, whoops, your digits are gone.

Money is the life blood of all worldly power.   And as with all great power, it is immensely attractive to the easily corruptible, who willfully prey on the weak and the naive.  Political and financial power is the mother's milk of spiritual death.

Well, such are the times.  And since some have done it so well with this general corruption, many others are joining in.  Truth is too often led down a blind alley and strangled in the service of this power.  And people look aside, based on their own personal advantage and craven careerism.

Bitcoin stumbled a bit today  As did the dollar.  The one is a cresting bubble.  The latter, not so much— yet.  But they are working on it.

There is seems to be little understanding of the fundamentals of monetary value today and its foundation in history that one might despair of our ability to avoid one of the more memorable failures.

The spirit of John Law is alive and well.  And  it is stalking the halls of the academy, and the fevered brains of the untethered innovators of money creation.  And the less unfettered the better.

The FCC looks set to put an end to 'net neutrality.'  This is the beginning of the end for the internet as we have known it.  I would hope that the Congress can do something to override it, but I am not hopeful in their integrity in the face of corporate millions.

Don't give yourself away to the worldly powers too easily.  Yes, the lies are flying thick and fast from both sides.  But deep down you know what to do.  It is just hard sometimes.

Gold managed a nice rally back off the FOMC day. Wow, who could have expected that?

And silver joined in and took back the 16 handle.

Stocks were lackluster.   There will be a stock option expiration on Friday.

I doubt we will see any sustained selling into the end of the year.  The volumes are likely to be too light for that, although we should expect some 'portfolio rebalancing.'

This will get very interesting next year.  We will hardly be able to stand the excitement.

Have a pleasant evening.

The End of an Error, or Just the End of the Beginning?