Stocks and Precious Metals Charts - This Is the Credibility Trap - Audacious Oligarchy

 

"Many as are our sins, His grace is greater. Our sins are more in number than the hairs of our head; yet even the hairs of our head are all numbered by Him.  He counts our sins, and, as He counts, so can He forgive; for that reckoning, great though it be, comes to an end; but His mercies fail not, and His Son's merits are infinite."

John Henry Newman 

 

“It may well be that we will have to repent in this generation.  Not merely for the vitriolic words and the violent actions of the bad people, but for the appalling silence and indifference of the good people." 

Martin Luther King

 

"The dying [repentant] thief had, perhaps, disobeyed the will of God in many things: but in the most important event of his life he listened and obeyed.  The Pharisees had kept the law to the letter and had spent their lives in the pursuit of a most scrupulous perfection.  But they were so intent upon perfection as an abstraction that when God manifested His will and His perfection in a concrete and definite way they had no choice but to reject it.”

Thomas Merton

 

“A decline in courage may be the most striking feature that an outside observer notices in the West today.  The Western world has lost its civic courage. Such a decline in courage is particularly noticeable among the ruling and intellectual elite, causing an impression of a loss of courage by the entire society.” 

Aleksandr I. Solzhenitsyn

 

"Human beings are so made that the ones who do the crushing feel nothing; it is the person crushed who feels what is happening." 

Simone Weil

 

These are the three greatest gifts:  repentance, forgiveness, and thankfulness.

And the greatest tragedy is to harden our hearts against them, out of fear and pride.

Stocks managed to rally today thanks to the guile of Jay Powell, who played the dove to stimulate the speculative bubble, at least for the day

The Dollar drifted lower.

Gold and silver rallied again off the anticipated bottom for the Non-Farm Payrolls report.

The VIX fell as the risk on sentiment shoved away the fears of risks.

This market is one exogenous event away from a meltfown.

A regional Fed President's comments today dismissing out of hand the question of ethics issues at the Fed were disturbingly disingenuous at best.  

Of course there are no ethical considerations, because their ethics are carefully crafted, self-serving legalisms which enable their audacious and abusive privileges.

And they are shamelessly tolerated by those who are also beneficiaries of this systemic corruption.

"To speak out against madness may be to ruin those who have succumbed to it.  So the wise in Wall Street are nearly always silent.  The foolish thus have the field to themselves.  None rebukes them." 

John Kenneth Galbraith, The Great Crash of 1929

This is the credibility trap in which we find ourselves today. 

Have a pleasant evening.

 

"A credibility trap is when the managerial functions of a society have been sufficiently compromised by corruption so that the leadership cannot reform, or even honestly address, the problems of that system without implicating a broad swath of the powerful, including themselves.  The moneyed interests and their servants tolerate the corruption because they have profited from it, and would like to continue to do so.  Discipline is maintained by various forms of soft financial rewards and social and organizational privileges." 

Jesse 

 

 

Stocks and Precious Metals Charts - Credibility Trap

"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.

Admitting failure is not an option for the thought leaders who receive their power from that system.  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, 18 September 2013

Stocks bounced today.

The dollar edged higher.

Gold and silver rallied.

The VIX declined.

There will be a precious metals options expiration on the Comex next week.

Have a pleasant evening.

Stocks and Precious Metals Charts - Balancing Act

"It has been the longest bull market in modern history, enabled by massive Central Bank intervention. But with trade wars raging, Brexit, Presidential impeachment over something, etc., there remains a significant risk of a recession over the next 12 months.

If we look at the normalized change in the 10Y-3M curve minus normalized change in 10Y yields, we can see a heightened recession risk. Lower yields and steeper curves are not a good recipe. And then we have the decline in S&P 500 earnings estimates. Recession coming?"

Anthony Sanders, Confounded Interest


"Day by day the money-masters of America become more aware of their danger, they draw together, they grow more class-conscious, more aggressive. The [first world] war has taught them the possibilities of propaganda; it has accustomed them to the idea of enormous campaigns which sway the minds of millions and make them pliable to any purpose.

American political corruption was the buying up of legislatures and assemblies to keep them from doing the people's will and protecting the people's interests; it was the exploiter entrenching himself in power, it was financial autocracy undermining and destroying political democracy. By the blindness and greed of ruling classes the people have been plunged into infinite misery."

Upton Sinclair, The Brass Check

Stocks slumped again today on renewed concerns about global trade.

December 15^th may be a date of interest, tariff-wise.

As you can see from the charts, the major stock indices managed to crawl back up to a reasonable level of trend support.

The rest of the week into the Non-Farm Payrolls Report should tell us the story.

Gold and silver had a nice rally higher after a long coiling process.

But we are still well within the short term declining (coiling?) patterns on the chart. So no breakout yet.

The underpinnings of the market are vulnerable to exogenous shocks. So I would proceed with caution.

The equity and high yield bond markets are leaning heavily on the Fed's balance sheet. And that may not be a longer term sustainable arrangement, and certainly not any formula for sustainable economic recovery.

What would I do?  Reform.   It's obvious.  The system is bent, and consciously so, to sweep the wealth up to a few 'at the top.'  It's a racket.

But the credibility trap will not allow the powers that be and their enablers and politicians to consider it as an option, or even to cite systemic imbalance and corruption as a problem.   Those that do are ignored, smeared, and villified by those that thrive on the existing imbalance.

The banks must be restrained, and balance restored to the economy, and the dark money power limited from its manipulation of policy, politics, and public discourse, before there can be any sustainable recovery.

Have a pleasant evening.

Stocks and Precious Metals Charts - The Mask of Agamemnon - Deliberate Lies and Mispricing of Risks

"At the root of America's economic crisis lies a moral crisis: the decline of civic virtue among America's political and economic elite.  A society of markets, laws, and elections is not enough if the rich and powerful fail to behave with respect, honesty, and compassion toward the rest of society and toward the world."

Jeffrey Sachs


"Of this Logos the Word being eternal, men have proven to be uncomprehending, both before they hear and once they have heard it. For although all things happen according to this Word, they are like the uneducated who first experience words and deeds such as when I distinguish each thing according to its essence and show how it is.

And as for the rest, they are as unaware of what they do when they are awake, as they are when they are asleep."

Heraclitus


“I believe order is better than chaos, creation better than destruction. I prefer gentleness to violence, forgiveness to vendetta.  On the whole I think that knowledge is preferable to ignorance, and I am sure that human sympathy is more valuable than ideology.  I believe that in spite of the recent triumphs of science, men haven't changed much in the last two thousand years; and in consequence we must try to learn from history.  History is ourselves.

I believe in courtesy, the ritual by which we avoid hurting other people's feelings, by satisfying our own egos.  And I think we should remember that we are all part of a great whole, which for convenience we call nature.   All living things are our brothers and sisters."

Kenneth Clark, Civilisation


The broken wall, the burning roof and tower
And Agamemnon dead.

W. B. Yeats, Leda and the Swan


“Each day we are becoming a creature of splendid glory, or one of unthinkable horror.”

C. S. Lewis

Lies seem to be coming more and more easily to and prevalent among the ruling elite, and their enablers and acolytes in the professional class.  And it is therefore no surprise that hatred and irrationality are also in the air.

It will get worse before it gets better. If history is any guide, may God forgive us, this will end in blood.

Pray for each other, that you do not lose your way in this madness.

Stocks were soaring to new highs today, and gold rose sharply, off of the rather dovish testimony of Fed chair Powell.

His rationale for cutting rates in such a 'strong economy' is trade risks. Although he did note correctly that despite the apparent improvements, wages still remain sub-par.

Gold rallied smartly, up $20 to the upper bound of the consolidation pattern in which it is currently coiling.

If it breaks out to the upside it could be rather impressive.

I am stunned, and I hear little talk about it, at the lack of withdrawals from the Comex Hong Kong warehouses, much less the NY ones.

Hong Kong has been an active supplier of physical gold to Asia for some time.

Something momentous is happening behind the scenes. I am almost certain of this.  It will of course be brought to light, eventually.   But it will not be acknowledged readily by those who draw power from this rotten system.  This is the credibility trap.

"The truth has to be melted out of our stubborn lives by suffering.  Nothing speaks the truth, nothing tells us how things really are, nothing forces us to know what we do not want to know except pain."

Aeschylus, The Oresteia

Do not allow yourself to be swayed back and forth by those snakes and vipers who prey upon the innocent for a living, and lead them into destruction, for gain, and too often just for sport.

And remember me in your prayers, as I remember you.

Have a pleasant evening.

Mark Blyth On Brexit, the Euro, Austerity, and the Rise of the Technocrats and Oligarchs

"Europe will be forged in crises, and will be the sum of the solutions adopted for those crises.”

Jean Monnet, Memoirs


"I’m very pro-European, but I’m against the euro, so if I still lived in the UK I would have an interesting choice.  Now if you look at Larry Elliott in The Guardian, he thinks he should vote for exit because this might be the existential crisis that blows up the euro. Now why would you want to blow up the Euro, because 'that would be terrible etc. et cetera'.  Because the long-term effect of the euro is going to be to drive Western European wages down to Eastern European levels in global competition for export share with the Chinese.

That’s one interpretation as to where this all goes.  And that’s going to be fine for the Eastern Europeans coming up.  It’s going to be great for very efficient exporters in the North.  It’s going to be a disaster for France and parts of Italy, if not all, and certainly for Greece.

Now if you have a system in which one side runs a surplus and the other side cannot run a deficit because of the rules, the only thing the other side can do is permanently contract their economies to allow someone else to make money selling BMWs.  I don’t see this ending well so perhaps it’s better to nip it in the bud when you’ve got the chance."

Mark Blyth

While in some ways this analysis by Mark Blyth (and similarly by Thomas Frank) can be construed as an over-simplification.  But on the other hand it represents an insight into a fundamental reality that is driving much of what we are witnessing today, a reality that seems inexplicable to the political class of both left and right.

The liberals blame the irresistible imperatives of globalization and technology, and the conservatives blame immigration and everyone who isn't them or completely like them in outlook and customs.

Each has their own extreme prescriptions for the problems, many of which they have a part in causing, from free money gifted within the status quo structure,  to debt serfdom for most except the few.

And both are tragically misplaced in their judgements, because they are caught in a credibility trap of their respective ideologies that have displaced fundamental morality, fairness, and goodness.

It is hard to tell which side is more reluctant to see the systemic forces which are at play, and where they are leading. Both are willfully blind at their core, taking refuge in contempt for others (cf. Hillary and Romney) and elaborately conceived condescension towards any form of dissent, even the mildest.

At the best of times the powerful will not listen, and at times like these most have joined them on either side to escape the pain of thinking.   The decline and fall of a privileged class that is out of touch with the people, and the extremes committed by their enablers, are so common as to be a cliché of history.

So why bother even bringing it up at all?   For the same reasons perhaps that groups like the White Rose and the early church wrote their pamphlets, in their respective times of general madness— to keep a light burning in the dark, for those who follow.

Hopefully our own situation will resolve well before we reach such an extreme disassociation of reason and power and justice.

"Caesar was swimming in blood. Rome and the whole pagan world was mad.   But those who had had enough of transgression and madness, those who were trampled upon, those whose lives were misery and oppression, all the weighed down, all the sad, all the unfortunate, came to hear the wonderful tidings of God, who out of love for men had given Himself to be crucified and redeem their sins.

When they found a God whom they could love, they had found that which the society of the time could not give any one—  happiness and love."

Henryk Sienkiewicz, Quo Vadis: In the Time of Nero

Regulatory Capture: The Banks and the System That They Have Corrupted

"But the impotence one feels today— an impotence we should never consider permanent— does not excuse one from remaining true to oneself, nor does it excuse capitulation to the enemy, what ever mask he may wear.  Not the one facing us across the frontier or the battle lines, which is not so much our enemy as our brothers’ enemy, but the one that calls itself our protector and makes us its slaves.  The worst betrayal will always be to subordinate ourselves to this Apparatus, and to trample underfoot, in its service, all human values in ourselves and in others."

Simone Weil


"And in some ways, it creates this false illusion that there are people out there looking out for the interest of taxpayers, the checks and balances that are built into the system are operational, when in fact they're not.  And what you're going to see and what we are seeing is it'll be a breakdown of those governmental institutions.  And you'll see governments that continue to have policies that feed the interests of -- and I don't want to get clichéd, but the one percent or the .1 percent -- to the detriment of everyone else...

If TARP saved our financial system from driving off a cliff back in 2008, absent meaningful reform, we are still driving on the same winding mountain road, but this time in a faster car... I think it's inevitable. I mean, I don't think how you can look at all the incentives that were in place going up to 2008 and see that in many ways they've only gotten worse and come to any other conclusion."

Neil Barofsky


"Written by Carmen Segarra, the petite lawyer turned bank examiner turned whistleblower turned one-woman swat team, the 340-page tome takes the reader along on her gut-wrenching workdays for an entire seven months inside one of the most powerful and corrupted watchdogs of the powerful and corrupted players on Wall Street – the Federal Reserve Bank of New York.

The days were literally gut-wrenching. Segarra reports that after months of being alternately gas-lighted and bullied at the New York Fed to whip her into the ranks of the corrupted, she had to go to a gastroenterologist and learned her stomach lining was gone.

She soldiered through her painful stomach ailments and secretly tape-recorded 46 hours of conversations between New York Fed officials and Goldman Sachs. After being fired for refusing to soften her examination opinion on Goldman Sachs, Segarra released the tapes to ProPublica and the radio program This American Life and the story went viral from there...

In a nutshell, the whoring works like this. There are huge financial incentives to go along, get along, and keep your mouth shut about fraud. The financial incentives encompass both the salary, pension and benefits at the New York Fed as well as the high-paying job waiting for you at a Wall Street bank or Wall Street law firm if you show you are a team player.

If the Democratic leadership of the House Financial Services Committee is smart, it will reopen the Senate’s aborted inquiry into the New York Fed’s labyrinthine conflicts of interest in supervising Wall Street and make removing that supervisory role a core component of the Democrat’s 2020 platform. Senator Bernie Sanders’ platform can certainly be expected to continue the accurate battle cry that 'the business model of Wall Street is fraud.'"

Pam Martens, Wall Street on Parade

This is a good example of both regulatory capture and the credibility trap that co-opts those who benefits from the system as it is, even if it is by turning a blind eye and saying nothing, going along to get along, taking the 'bullet or the bribe.'

Never assume that because a person, such as media analyst or reporter, is highly paid that they are somehow beyond the temptation to violate their trust.  Quite the contrary.   They do not believe that change can come because they have anaesthetized their integrity as a matter of convenience.  And when called upon, they will support and defend and excuse the system as it is, at first by their inaction, and then by their willing cooperation.

The corruption takes a person one seemingly innocuous decision and event at a time.  their separate their fingers, one by one, until they finally let their souls slip through and fall— and they belong to the darkness of this world.  And at the end of the day, for what?   A little more money, the patina of prestige and superiority, access to power?

Who then can stand against the world, when power and money are assumed and created out of nothing, and distributed in an unjust, interconnected system of favors and services, without duty and without honor?

And so those captured in this system excuse and accept their own part in it, for their personal benefit and professional ego and advancement, that heady feeling of sophistication and acceptance by the worldly.

It's an old story  It is so old that at times it seems as if distant, just a story from another time— a fable.   But it is real.  It is the very fundamental core of this reality.  It is the continuing struggle.

It is, in the end, the only thing that matters, the only triumph or personal tragedy.  It is the only consequence that you will dwell upon, when the husk is stripped bare, and you yourself face the only certainty in this world alone, and as your truly are.

Bill Binney Assesses the DNC Hack and the Mueller Indictments

"But the impotence one feels today— an impotence we should never consider permanent— does not excuse one from remaining true to oneself, nor does it excuse capitulation to the enemy, what ever mask he may wear.

Whether the mask is labeled fascism, democracy, or dictatorship of the proletariat, our great adversary remains The Apparatus— the bureaucracy, the police, the military. Not the one facing us across the frontier or the battle lines, which is not so much our enemy as our brothers’ enemy, but the one that calls itself our protector and makes us its slaves. No matter what the circumstances, the worst betrayal will always be to subordinate ourselves to this Apparatus, and to trample underfoot, in its service, all human values in ourselves and in others."

Simone Weil

We live in an age of hypocrisy, where the narratives flatter us, and relieve us of the problem of thinking.

Power, control and money—  the bullet or the bribe.

Economic Theology - Obama and the Rise of the New International Elite

"Do we need weapons to fight wars?  Or do we need wars to create markets for weapons? ...In the privatization of everything, these companies have made the Indian economy one of the fastest growing in the world.   There’s only one problem – they exploit everything and everyone in its wake.  It’s a dream come true for businessmen – to be able to sell what they don’t have to buy.”

Arundhati Roy, The Ghost of Capitalism

Thurman Arnold wrote in The Folklore of Capitalism that  'Economic theology is the opiate of the middle class...Law, morals, and economics are always arrayed against new groups which are struggling to secure a place in an institutional hierarchy of prestige."

Arnold goes on to say in an essay in reply to a review of his book that "Philosophies, legal, ethical, and economic appear very different from the outside looking in than from the inside looking out. The inside point of view assumes that if reasoning men get their heads together, they can make the concept of a good life a workable tool.  From the outside it is obvious that reasoning men never agree. Their conflicts only create more literature."

What Arnold is going after is the very notion of the meritocracy, and the mythology of philosopher-kings. In the abstract reality is not captured, and therfore cannot be made workable.  There is no such thing as a perfect system, one that will solve all problems if you can only tweak it here and there.

A workable system requires practical and talented people, not necessarily the most credentialed and pedigreed, that are working with a genuine dedication  and focus to a set of first principles and priorities. 

It is a project doomed to failure to allow process to stand over priority,  the realization of the perfectly designed system for its own sake, because such a system does not exist, and is almost always a canard to promote some powerful interests for their own sake.

He means ideologically based systems like 'supply side economics.'.  It may have failed, miserably and spectacularly at every turn, but it still sounds pretty good on paper.  And so here we go again.

Or globalization, free markets and free trade—  these are all good examples of a misbegotten first principles,  tenets of economic theology that form the foundation of a system designed for process, rather than results.

If you wish to understand Obama, Clinton and the modern Democratic and Republican parties, which are both parties representing different segments of the affluent and the powerful,  I urge you to spend the time to watch the latter half of the second video.  The Democrats may speak the cause of the dispossessed and the weak, but tend to treat and view them not as constituents but as charges, with the kind of condescension and utility of neo-colonialism and 'the meritocracy's burden.'

Obama is every bit the narcissist as is Trump.  The difference is that Obama is more articulate in his expressions of it, in his appeals to those things that will provide him more of what he thinks that he deserves.

It is an analysis of our current situation by Thomas Frank. You may have seen it before, but I urge you to watch it through in light of everything that has occurred. Watch the entire video with the Q&A if you have the time.   There are some practical solutions discussed therein.  Basically the system is going to be changed from the bottom up, or not at all.

Real News: About That Russian Hacking Indictment And Its Willful Misuse

Quadraro, Death of Justice

William Roper: So, now you give the Devil the benefit of law!

Sir Thomas More: Yes! What would you do?  Cut a great road through the law to get after the Devil?

William Roper: Yes, I'd cut down every law in England to do that!

Sir Thomas More: Oh? And when the last law was down, and the Devil turned 'round on you, where would you hide, Roper, the laws all being flat?  This country is planted thick with laws, from coast to coast, Man's laws, not God's!  And if you cut them down, and you're just the man to do it, do you really think you could stand upright in the winds that would blow then?  Yes, I'd give the Devil benefit of law, for my own safety's sake!

Robert Bolt, A Man For All Seasons

Aaron Mate of The Real News interviews Michael Isikoff about the Russian hacking indictment in the video below.

Michael Isikoff's dismissive and almost bullying remarks aside, I think most people will continue to look at this carefully, and will keep an open mind.

Isikoff is not persuasive, except if one is intimidated by veiled references to secret evidence and the invoking of 'authority.'

And clearly Aaron Mate is not. This is what makes him a much better, or one may say genuine, journalist.

I have trouble conceiving that this indictment will ever be tested in court, unless they decide to try the defendants in absentia.   It is a convenient way to make public charges without ever having show the evidence, and test their veracity in a public court of law.  But they do make nice talking points for the prevailing narrative.

It would be as if a prosecutor in Moscow were to indict top officials in the US government for cyber crimes, such as bugging the personal phones of allied heads of state, or interfering in other countries' elections, and expect them to fly over for a trial.

I can only imagine what the reaction here would be to such an obvious ploy.

But I am sure that this indictment will be frequently misused as 'proof' of the case, and widely referenced without critical thought, to try and shame honest skepticism and alternative views on this matter.

Such as in this article in The Intercept by James Risen, for example.

But Risen has shown the weakness in the presentation of his reasoning before, in his debate with Glenn Greenwald,

An indictment is proof of nothing, other than an indictment has been granted to proceed with something known as a 'trial' of the pertinent facts to determine guilt or innocence.   As since 'the evidence' is part of an indictment, it is not subject to open, investigative examination and potential rebuttal.

It is a 'charge' that is as of yet unproven, and we need to be very careful about giving charges such weight in the public discourse.  It can ruin lives and reputations without due process, and cause potentially innocent individuals to much hardship, intimidation, and even confinement.

No matter how many functionaries may have signed off on it.   How many times do we need to have this proven to us both pro and con, from WMD's to allegations of mass government surveillance?  It is presented to the public with such authority and weight—  until the truth rears its ugly head.

And innocence is presumed, or at least it used to be, before the hysterics were engaged after Hillary's stunning loss.

As regular readers know I am no 'fan' of Trump, or Hillary, and especially not of the Russian government,.  If anything  I am concerned that we are falling into the same type of authoritarian oligarchy that prevails there.

But I am not willing to toss aside principles and reason for personal satisfaction or political gain.   If we do, we are no different from those that we pretend to oppose—  we merely serve different ends without regard to means, like competing crime families.

Isikoff and those who speak and write in the mainstream media know this.  But they do not seem to care.  Such is the lack of principles for the sake of partisanship to which our modern media has descended, especially since it has been concentrated into a few powerful hands.

I am afraid that Michael Isikoff's conclusions will obtain such thoughtful scrutiny and analysis from the Sunday morning television pundits, both pro and con.

And therefore one goes to other sources like The Real News to get a more balanced picture.

Do not point the finger at the underwhelming actions of the Russians for the lack of trust and deep partisan divide here.

We have ourselves to blame, our lack of critical thinking and demand for justice with accountability, and acquiescence to the repeated heavy-handed actions of enablers in service of money and power, might over right.

As long as the con jobs sell, and money is being made, no one in the money and power pipeline has an incentive to stop the lying unless it is their conscience. And with this craven and spiritually adulterous generation, good luck with that.

The Tragic Failure of the Democratic Establishment And Their Contemptible Betrayal of the New Deal

"There is a lack of critical assessment of the past. But you have to understand that the current ruling elite is actually the old ruling elite. So they are incapable of a self-critical approach to the past."

Ryszard Kapuściński


"Every president since 1988 attended an Ivy League university. Not only does this perspective from the professional class cross party lines, their orthodox worldview extends far beyond politics. It is based on an ideology that has served elites well – (semi) free-market capitalism and continuous economic growth. It is an orthodoxy that values corporate interests and personal gain over public good. It permeates all fields of society and American culture.

In their book Manufacturing Consent, Edward Herman and Noam Chomsky laid out the media propaganda model of journalism, in which they describe the small parameters of discourse allowable in mainstream media, due to factors such as advertising, corporate ownership, and the dominant elite mindset. The media propaganda model they describe is akin to the Ivy League orthodoxy of which Frank speaks.

Disciplines cater to a small span of acceptable dialogue and thought based upon shared assumptions. Within that realm, diversity exists, but that diversity does not usually breach understood boundaries. Some voices reach the periphery of the border, but retract from crossing the line through caveats.

Those who traverse boundaries tend to be marginalized, regardless of the substance, depth, and validity of their arguments and ideas. This orthodoxy is maintained chiefly through tacit self-censorship and is internalized by those who practice it."

Kristine Mattis, The Cult of the Professional Class

The Democratic leadership is caught in a credibility trap of repeated failures to do the right thing out of self-interest.     The Republicans are so bent that they are most likely beyond redemption.

Thomas Frank on the Democratic Party, Their Credibility Trap, and the Beleaguered Middle Class

“In its quest for prosperity, the Party of the People declared itself wholeheartedly in favor of a social theory that forthrightly exalted the rich—the all-powerful creative class.

To the liberal class, every big economic problem is really an education problem, a failure by the losers to learn the right skills and get the credentials everyone knows you’ll need in the society of the future.

Professional-class liberals aren't really alarmed by oversized rewards for society's winners; on the contrary, this seems natural to them -- because they are society's winners. The liberalism of professionals just does not extend to matters of inequality; this is the area where soft hearts abruptly turn hard.

Of course Republicans do it too. The culture wars unfold in precisely the same way as the liberal virtue-quest: they are an exciting ersatz politics that seem to be really important but at the conclusion of which voters discover they've got little to show for it all besides more free-trade agreements, more bank deregulation, and a different prison spree.”

Thomas Frank


"What is most important for democracy is not that great fortunes should not exist, but that great fortunes should not remain in the same hands. In that way there are rich men, but they do not form a class."

Alexis de Tocqueville


"People of privilege will always risk their complete destruction rather than surrender any material part of their advantage.  Intellectual myopia, often called stupidity, is no doubt a reason.  But the privileged also feel that their privileges, however egregious they may seem to others, are a solemn, basic, God-given right.  The sensitivity of the poor to injustice is a trivial thing compared with that of the rich."

John Kenneth Galbraith

The examples of the credibility trap are apparent, especially in the Democratic Party because their own contradictions are so glaring.  It is harder to see in the Republicans because their hypocrisy in serving the wealthy faithfully in economic matters while duping the public with inflammatory cultural issues is almost a trademark.

But as Frank relates, the middle class is being badly abused and neglected by both professional political parties.  And this is unfortunate, because it is a strong and stable middle class that provides a large social organization its coherence and durability.

I do not see meaningful reform coming until the status quo in American party politics is repudiated and renewed again with a more democratic focus on people.

The powerful, those who built and have been fabulously rewarded by the current system, will oppose any threat to their exorbitant privilege, which they see as perfectly equitable and justified and fully well-deserved, with all the wiles and power moves that they can deploy, even against their own.

When one has all that a normal person could possibly need and even want, those who continue on playing for blood, who are generally 'afflicted'  in some manner— for those personalities it becomes all about the game, and winning for its own sake, and power.  And there will never be enough people and things to fill their emptiness.

This growing dichotomy, this gulf between appearance and reality, between policy and outcomes, will not only strain the social fabric, but historically is the kind of human dynamic that can light a fire in hearts and minds, despite increasingly desperate attempts to discredit, suppress, and then extinguish it.

And there are too often consequences that no rational person would wish happen.  And yet they do, and with some striking, almost cyclical, regularity.  Such is the weakness of human nature, and the wonderful power of self-delusion.

Stocks and Precious Metals Charts - Seth the Arbiter of Chaos

"Friday, April 20, was Hitler's fifty-sixth birthday. The radio announced that Hitler had come out of his safe bomb-proof bunker to talk with the fourteen to sixteen year old boys who had 'volunteered' for the 'honor' to be accepted into the SS and to die for their Fuhrer in the defense of Berlin.

What a cruel lie! These boys did not volunteer, but had no choice, because boys who were found hiding were hanged as traitors by the SS as a warning that, 'he who was not brave enough to fight had to die.' When trees were not available, people were strung up on lamp posts. They were hanging everywhere, military and civilian, men and women, ordinary citizens who had been executed."

Dorothea von Schwanenfluegel, The Battle For Berlin


“Judging others makes us blind, whereas love is illuminating.  By judging others we blind ourselves to our own evil and to the grace which others are just as entitled to as we are.”

 Dietrich Bonhoeffer

That really is the problem isn't it, as captured in those two seemingly disparate quotes by Bonhoeffer.  How does one speak out without judging, or rather falling into the fault of being judgmental?  And yet not to fall into that more terrible complicity of silence?

What complicates the matter is that the people tend to enjoy when someone is speaking out against those things which they do not like. But they tend to react with almost violent indignation when anything with which they have emotionally identified themselves is brought up for judgement. Not intellectually, but emotionally identified.

The more a thing may disappoint them, the more it may be proven false, the more readily it is debunked and shown to be a falsehood, or even evil, the more strongly some will embrace it, as if by sacrificing their own integrity, and perhaps even their souls, for something so unworthy will silence the criticisms and redeem it.

As noted in the first quote, I was always puzzled by the mass hangings of those who were not showing sufficient enthusiasm for the Fuhrer during the Battle of Berlin, even as the Russians were rolling into town and the war was obviously lost.  Why weren't these brave SS fanatics fighting for their city, rather than going around and hanging boys and old men?

But it makes perfect sense, if one thinks of it in terms of the credibility trap.

For to admit that the Reich was a lie, and a mistake,  that they were fanatical fools, and Hitler an incompetent creature of evil would be to admit that one was wrong, a failure, and worse, had become an accomplice to an unimaginable evil.

To accept that guilt, to admit one's complicity in such a horrendous assault on justice, to humble oneself and ask for forgiveness,  would have taken a heroic act of self-awareness, humility and repentance.  And worse, for these fanatics, it would diminish their pride, which was at the foundation of the most fervent supporters of such flamboyant excess.

That, and a desire to become beasts, to lose themselves in their mindless fanaticism, and escape the pain of being men.  And so they struck out, and killed everything that held up a mirror to their darkened souls, and showed them their pride was based on a lie.

So odd, that after having lost a long and costly war that was based on hatred and lies for the economic benefits of a few, that men would dress up in their costumes, which in any other context would be ridiculous, and rampage around, lynching the innocent.

Pride is the mother of all sin. This is the descent into hell.  This is the unwillingness to let go of the lie, for the sake of pride and its power, and cling to evil as it draws one into the abyss.

This is why some thinkers say that the door to hell is indeed locked—  from the inside.

And not all violence in the service of evil has to be physical.   In modern times the weapon of choice is often economic and financial. 

Stocks ended the week quietly, having struck their level for the stock option expiration today.

There will be a precious metals option expiration on the Comex next Thursday the 24th. I have included those calendars below.

Have a pleasant weekend.