"As a country becomes industrialized, its governance and corruption challenges do not disappear. They simply morph and become more sophisticated: Transfer of a briefcase stashed with cash is less frequent.
Instead, subtler forms of capture and 'legal corruption' exist: an expectation of a future job for a regulator in a lobbying firm, or a campaign contribution with strings attached. In many countries this may be legal, even if unethical. In industrialized nations undue influence is often legally exercised by powerful private interests, which in turn influence the nation's regulations, policies and laws."
Daniel Kaufmann, Corruption And The Global Financial Crisis, Forbes, 27 January 2009
And they said to him, 'Where will this happen, Lord?' And He said to them, 'Where death is, there will be a gathering of vultures.'”
Luke 17:37
"A credibility trap is a condition wherein the financial, political and informational functions of a society have been compromised by corruption and fraud, so that the leadership cannot effectively reform, or even honestly address, the problems of that system without impairing and implicating, at least incidentally, a broad swath of the power structure, including themselves.
The status quo tolerates the corruption and the fraud because they have profited at least indirectly from it, and would like to continue to do so. Even the impulse to reform within the power structure is susceptible to various forms of soft blackmail and coercion by the system that maintains and rewards.
And so a failed policy and its support system become self-sustaining, long after it is seen by objective observers to have failed. In its failure it is counterproductive, and an impediment to recovery in the real economy. The continuity of the structural hierarchy must therefore be maintained at all costs, even to the point of becoming a painfully obvious, organized hypocrisy."
Jesse, What Is a Credibility Trap, 18 September 2014
Stocks made a serious attempt to rally off that deep low from yesterday.
And for the first half of the day they were doing fairly well.
But alas, a rally was not meant to be, and in the afternoon the stock rally failed impressively.
Gold and silver also attempted to rally off their oversold condition, but they too could not hold their gains, although gold did finish a bit higher.
The VIX rose.
The Dollar edged higher into the 114 handle.
In news after the bell sixteen Banks were fined $1.1 Billion for failing to maintain records of communications between their employees.
The usual excuses were being made, yada yada. But collusion between employees to break the law is a commonplace temptation that requires the Banks to maintain records of those communications.
Stock are at a 'must hold' point here on the charts, and a further decline from here may destabilize things further.
Needless to say, the markets are one event away from a panic.
But that's how it is when journeying through experiments in lawlessnes.
Have a pleasant evening.
