30 June 2020

Stocks and Precious Metals Charts - Hey Bartender! - Draw a One, Draw a Two, Draw a Three More Glasses of Beer

“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

"They run all away, and cry, 'the devil take the hindmost'."

Beaumont and Fletcher, Philaster, or Love Lies a-Bleeding

"While everyone enjoys an economic party the long-term costs of a bubble to the economy and society are potentially great. They include a reduction in the long-term saving rate, a seemingly random distribution of wealth, and the diversion of financial human capital into the acquisition of wealth.

As in the United States in the late 1920s and Japan in the late 1980s, the case for a central bank ultimately to burst that bubble becomes overwhelming. I think it is far better that we do so while the bubble still resembles surface froth and before the bubble carries the economy to stratospheric heights. Whenever we do it, it is going to be painful, however.”

Larry Lindsey, Federal Reserve Governor, September 24, 1996 FOMC Minutes

They know exactly what they are doing by now.

They will go ahead and play dumb and act bewildered when it blows up.

All things considered, they simply don't seem to care.

Stocks closed the end of the second quarter with a bang.

What a surprise.

The paint was barely dry on the tape when stocks managed to keep going higher, led by the usual new era suspects in the tech field.

Gold and silver popped higher as well, with gold finishing around 1799.

Gold has already broken out, but 1800 remains as a 'psychological round number resistance.'

Silver needs to take out 19 and hold it for its own breakout.

I figured that they would let the metals run a bit today, since the markups on their short positions already hit the books.

And so I came in with a levered silver position. Thank you thieves.

The big tickle today was the housing prices number.


Have a pleasant evening.