Palm Sunday

 

“He became what we are, that we might become what he is.”

Athanasius of Alexandria, The Incarnation of the Word

Stocks and Precious Metals Charts - The Deadly Embrace of Pride

 

“People with advantages are loathe to believe that they just happen to be people with advantages.  They come readily to define themselves as inherently worthy of what they possess; they come to believe themselves 'naturally' elite; and, in fact, to imagine their possessions and their privileges as natural extensions of their own elite selves.”

C. Wright Mills, The Power Elite, April 1956

“An inflated consciousness is always egocentric and conscious of nothing but its own existence.  It is incapable of learning from the past, incapable of understanding contemporary events, and incapable of drawing right conclusions about the future.  It is hypnotized by itself and cannot be argued with.  It dooms itself to calamities that strike it dead."

Carl Jung, Psychology and Alchemy, 1944

“Pride is the beginning of sin. It was pride that changed angels into devils, and it is humility that makes men angels. There never has been, and never can be, any sin without pride."

Augustine, City of God and On Nature and Grace

"Almighty God lets the sinner go his own way, for He has given to man free-will, and does not want a forced obedience, but an obedience springing from love.  In his forgetfulness of God, the sinner squanders his fortune, the natural and supernatural gifts which he has received, using his natural gifts, his health, his physical powers, and his reason, to offend God.

The sinner falls under the dominance of Satan, and becomes the slave of his lowest passions, which are signified by the swine which the prodigal was forced to feed.  But the more he obeys his passions, the more dissatisfied he becomes.  He feels an emptiness and spiritual hunger in his heart which he is powerless to satisfy.  He only knows that he is miserable, and hateful to himself."

Friedrich Justus Knecht, The Prodigal Son, 1910

“A proud man is always looking down on things and people; and, of course, as long as you are looking down, you cannot see something that is above you.”

C.S. Lewis, Mere Christianity, 1944


Stocks were dropping harder today, and have made lower lows, erasing the phony rally triggered by Trump's announcement of a ceasefire.

Will we see another insider trading opportunity set up for Monday.  One can only wonder,

Gold and silver bounced after the drubbing they took in observance of the Comex option expiration.

Bitcoin has fallen back down to the bottom of the trading range it has been in since early February.

Why this back and forth in crypto?  I assume the players on the Street have noticed this, and are banging that back and forth like an ATM.  

VIX climbed but is nowhere near the panic level.

The Dollar latched back on to the 100 handle.

I have marked the 20 and 30 percent decline levels on the SP500 and NDX charts.  There is also an open gap on the SP500 down there.

I would not hazard to make a guess how this weekend will go.  Who was the last person to talk to Donald?

Need little, want less, love more.  For those who abide in love abide in God, and God in them.

Next week is Holy Week. 

Have a pleasant weekend.  

Retrospective: Moral Hazard

 

Here is a reprint of one of the earliest entries on this platform from March 2008.

Widely ignored at the time, looking back now perhaps we will see the truth in it, and have a mind to breaking the cycle of recklessness and pillaging.   How many financial institutions have we bailed out since 2008?  Has wealth become more or less concentrated in fewer hands.  Has rampant risk-taking and speculation been reined in and reformed?  Is our financial system safer and more secure now?  Is the real economy flourishing or being starved of organic growth and productive capital formation? 

 

Moral hazard is the probability that a party insulated from risk will behave differently from the way they would behave if fully exposed to the risk.  Moral hazard arises because an individual or institution does not bear the full consequences of its actions, and therefore has a tendency to act with increasing recklessness, literally 'without reckoning.'  It also encourages the rise to power of sociopaths in society as a whole.

It is difficult to explain moral hazard to tenured professors or the pampered princes of bureaucracy, who beat the drum with their silver spoons in support of shifting the risk of loss to the public every time that Wall Street falls into one of its own schemes and blows itself up.

It is a lesson that the average person learns by the age of twelve and relearns, sometimes spectacularly, at least once in young adulthood.  If you do something wrong there can be bad outcomes, and you will pay the price and penalty.  Unfortunately there is a small but powerful oligarchy of privilege that is trying to project themselves onto the global stage while believing that they are immune to ordinary consequence, and have become addicted to the notion that 'others must pay' for their failures.

Moral hazard comes from rewarding bad behaviour in markets with wristslaps and bailouts. It is a danger to the economy and to the public.

Now we might expect even more brazen attempts to game the system. This inevitably leads to wild gyrations in stocks and bonds and commodities.  History suggests ever more brazen price manipulation so disconnected from reality that actual physical shortages result because of the corruption of the market pricing mechanism.

The wristslaps and bailouts will continue until these modern maestros kill themselves or someone else, and create damage too great to be bought off in the backrooms of the county courthouse.

At least their descent from the heights will be impressive, if you can avoid the impact crater.

Stocks and Precious Metals Charts - Into the Valley of Death

 

"Thus the elements are in place: a weak legislative body, a legal system that is both compliant and repressive, a party system in which one party, whether in opposition or in the majority, is bent upon reconstituting the existing system so as to permanently favor a ruling class of the wealthy, the well-connected and the corporate, while leaving the poorer citizens with a sense of helplessness and political despair, and, at the same time, keeping the middle classes dangling between fear of unemployment and expectations of fantastic rewards once the new economy recovers.

That scheme is abetted by a sycophantic and increasingly concentrated media; by the integration of universities with their corporate benefactors; by a propaganda machine institutionalized in well-funded think tanks and conservative foundations; by the increasingly closer cooperation between local police and national law enforcement agencies aimed at identifying terrorists, suspicious aliens and domestic dissidents."

Sheldon Wolin, Inverted Totalitarianism, 2003

"We are still under the sway of the destructive and thoroughly vain belief that man is the pinnacle of creation and not just a part of it, and that therefore everything is permitted to him.  People are manipulated in ways that are infinitely more subtle and refined than the brutal methods used in the post-totalitarian societies.  We still close our eyes to the growing social, ethnic, and cultural conflicts in the world. We are still destroying the planet that was entrusted to us.

I feel that the dormant goodwill in people needs to be stirred. People need to hear that it makes sense to behave decently or to help others, to place common interests above their own, to respect the elementary rules of human coexistence.

We are still incapable of understanding that the only genuine core of all our actions – if they are to be moral – is responsibility.  Responsibility to something higher than my family, my country, my firm, my success.  Responsibility to the order of Spirit, where all our actions are indelibly recorded and where, and only where, they will be properly judged.  Truth and love will overcome lies and hatred.”

Václav Havel, Speech to the US Congress, , February 21, 1990

“Daughters of Jerusalem, do not weep for me. Weep for yourselves and your children."

Luke 23:28

 

Stocks dropped decidedly today, going out on their lows, and giving up most of the rally that was Trump's phony announcement of a 'truce' that was used by insiders to game the markets.

Gold and silver were hit hard because it is an option expiration on the Comex for the April futures contracts.

The Dollar moved to the top of the 99 handle.   

Bitcoin gave up its recent push higher and slipped back down into the trading range it has been held in since the beginning of February.

VIX crept higher.

Israel and the US bases in the Mideast are largely exposed to Iranian missile attacks now, as the 'Iron Dome' has become depleted of effective interceptors.

The US seems to be preparing for some sort of ground action with light infantry.  And of course there is the chance of a targeted strike as we had seen in Venezuela against the Iranian leadership and nuclear or missile facilities.

And so we continue on into the valley of tears and death, pulled forward by the vanity of madness.

They will never learn, but can we? 

Have a pleasant evening.