"The historical evidence is overwhelming. Many societies have done well for a while – until powerful people get out of hand. This is an easy pattern to see at a distance and in other cultures. It is typically much harder to recognize when your own society now has an elite less subject to effective constraints and more able to exert power in an abusive fashion. And given the long history of strong institutions in the United States, it appears particularly difficult for some people to acknowledge that we have serious governance issues that need to be addressed."
Simon Johnson
"It is as popular now as ever to blame poor people for their station in life. Republican politicians love to talk about how poor people could stop being poor if only they made better choices or worked harder. If only they'd stop buying iPhones, they could afford insurance! These assholes - and I do not use that slur lightly - have no clue what it is like to grow up poor. They have no clue how hard it is in many places in the US just to keep the lights on and food on the table.
It is easy for them, from the comfort of their cushy offices and homes, with full bellies and bank accounts, to pretend that poor people like my mother are poor because they are stupid or lazy or ignorant or irresponsible rather than confront the broken systems that perpetuate poverty in Appalachia and all across the US.
Poor people don't contribute to reelection funds, but those who profit from poor people sure do. Therefore, truth be told, most politicians couldn't care less about the plight of the poor. There's so much profit to be made from poor people - think payday loans, high-interest rent-to-own stores, for-profit colleges, and overpriced mobile homes - that politicians and their crony-capitalist donors have a vested interest in keeping them poor."
Joshua Wilkey, My Mother Wasn't White Trash
Stocks sold off fairly sharply today.
One could point the finger at unrest in the Middle East, as Iran was blamed for seizing not one but two British tankers.
The VIX responded and so did the US dollar.
But gold and silver fell, in response to the Dollar but without regard to risk. For now.
I include my chart below showing the three ways of picturing this presumed consolidation pause on the gold breakout.
As you can see, my preferred formation the symmetrical triangle is making a very good fit. Gold came back down to test or 'kiss' the triangle after the initial breakout. In the other two gold merely retreats.
The market is expecting a 25 basis point cut at the next FOMC meetin on July 30-31. They had been thinking of 50 basis points. There was quite a bit of speculation on that earlier this week, sparked by some comments from a Fed head. The Fed has gone to some pains to correct that misperception.
And while no cut is certainly a possibility, I think it might shock the markets.
The markets are so spoiled on their bubble milky that they might even sell the news on a 25 basis cut.
Well, whatever. We'll have to wait for that one. I have included the economic calendar for next week.
Let's see what next week brings.
Have a pleasant weekend.
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