Stocks and Precious Metals Charts - Audacious Oligarchy - The Power Elite

 

"The economy - once a great scatter of small productive units in autonomous balance, has become dominated by two or three hundred giant corporations, administratively and politically interrelated.   The political order, once a decentralized set of several dozen states with a weak spinal cord, has become a centralized executive establishment which has taken up into itself many powers previously scattered.   The military order, once a slim establishment in a context of distrust fed by state militia, has become the largest and most expensive feature of government.

People with advantages are loath 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.

The idea of the elite as composed of men and women having a finer moral character is an ideology of the elite.

The American elite does not have any real image of peace — other than as an uneasy interlude existing precariously by virtue of the balance of mutual fright.  The only seriously accepted plan for peace is the fully loaded pistol.  In short, war or a high state of war-preparedness is felt to be the normal and seemingly permanent condition of the United States.

For the first time in American history, men in authority are talking about an 'emergency' without a foreseeable end.  Such men as these are crackpot realists: in the name of realism they have constructed a paranoid reality all their own.  America - a conservative country without any conservative ideology - appears now before the world a naked and arbitrary power, as, in the name of realism, its men of decision enforce their often crackpot definitions upon world reality.  

The second-rate mind is in command of the ponderously spoken platitude.  In the liberal rhetoric, vagueness, and in the conservative mood, irrationality, are raised to principle.  Public relations and the official secret, the trivializing campaign and the terrible fact clumsily accomplished, are replacing the reasoned debate of political ideas in the privately incorporated economy, the military ascendancy, and the political vacuum of modern America.

These men have replaced mind with platitude, and the dogmas by which they are legitimated are so widely accepted that no counterbalance of mind prevails against them. They have replaced the responsible interpretation of events with the disguise of events by a maze of public relations.

What the main drift of the twentieth century has revealed is that the economy has become concentrated and incorporated in the great hierarchies, the military has become enlarged and decisive to the shape of the entire economic structure; and moreover the economic and the military have become structurally and deeply interrelated, as the economy has become a seemingly permanent war economy; and military men and policies have increasingly penetrated the corporate economy.

C. Wright Mills, The Power Elite, 1956

Stocks rallied today, for no particular reason.

The chip sector led stocks higher, based on upgrades from Barclay.

Wash - rinse - repeat.   

Leave your shame at the curb.

Gold and silver were hit hard from the early trading, but managed to take much of it back with gold even finishing in the green.

Looks like a gut check ahead of the Comex precious metals option expiry on the 26^th.

 Different month, same crooked scams.

The US Dollar did nothing.

The VIX did nothing.

We may see some market moving data this week.

FOMC and Non-Farm Payrolls for January coming next week.

And the band played on.

Have a pleasant evening.

Stiglitz: Why Western Capitalism Has Been Failing Since 1980

As I had written some time ago in the The Fall of the American Republic: The Quiet Coup:

"I am not so optimistic that this reform is possible, because there has in fact been a soft coup d'etat in the US, which now exists in a state of crony corporatism that wields enormous influence over the media and within the government.

To be clear about this, the oligarchs are flush with victory, and feel that they are firmly in control, able to subvert and direct any popular movement to the support of their own ends and unslakable will to power.

This is the contempt in which they hold the majority of American people and the political process: the common people are easily led fools, and everyone else who is smart enough to know better has their price. And they would beggar every middle class voter in the US before they will voluntarily give up one dime of their ill gotten gains.

But my model says that the oligarchs will continue to press their advantages, being flushed with victory, until they provoke a strong reaction that frightens everyone, like a wake up call, and the tide then turns to genuine reform."

 

The article which I wrote was based on the insightful and largely ignored work by renowned economist Simon Johnson called The Quiet Coup.

 

This lecture by Stiglitz below is a little 'wonky' and uses some terminology which may be unfamiliar.

Nevertheless if you listen to it and just try to capture the main points of his discussion it will be worthwhile.

 

His basic premise is to ask why capitalism has shown a tendency to stagnation since 1980 in the United States and other parts of the West.

 

I am, as you know, an adherent to the belief that there has been a soft coup d'état in the US.  One can always quibble about the exact dates, but that is of less importance.   I have said it was shortly after Greenspan's 'irrational exuberance' speech, although the stage was certainly set for this during the 1980's with the rise of the efficient markets hypothesis, the assumption of rational wealth optimizers in the markets, and of course, the laughable supply side economics which are the old trickle down canard in drag.

 

The point, rather, is to understand what has happened, to continue to shine a light on it, and to hope that Simon Johnson is correct, that the overreach of the 'winners' will eventually provoke a reaction. 

 

Quite frankly I had thought it would have come by now.  One can rarely go wrong betting on the power of apathy and momentum, and the persistent greed of the sociopaths and their enablers.

 

After all, in the aftermath of a tragic derailment of the flagship train line in the US from Washington to Boston that could have been prevented by continuing investments in fundamental railroad infrastructure, the House of Republicans have voted to further slash Amtrak funding by $260 million. 

They are instructed to hate anything that benefits the public without putting an abundant stream of income into the pockets of their corporate money masters.  This explains their virulent animosity to Social Security, public transportation, public healthcare, public education, public infrastructure, consumer protections, environmental laws, safety regulations, product safety measures, and any sort of financial regulation that inhibits the greed and power of the Banks.

And we should be ashamed for continually standing quiet in the face of such pathological incivility.

 

But I can almost guarantee that if this crash had been the result of some sort of despicable act of terrorism for example, the public coffers would already be wide open, flowing with a Niagara of funds for homeland security and the militarization of domestic law enforcement.   Millions for the corporatized state, but little or nothing for the people.

 

I am increasingly concerned that, as has happened so many times in the past, the status quo will greet this eventual reaction for reform, justice, and equality with repression and even draconian measures to maintain what they perceive as their rightful place and power. 

 

Like apathy and momentum, it is also difficult to underestimate the self-delusion and overreach of sociopaths who would be as gods, even if they are gods of the damned.

History is replete with examples.

 

The Age of Narcissism

"Suddenly, abused and battered wives or children, the unemployed, the depressed and mentally ill, the illiterate, the lonely, those grieving for lost loved ones, those crushed by poverty, the terminally ill, those fighting with addictions, those suffering from trauma, those trapped in menial and poorly paid jobs, those whose homes are in foreclosure or who are filing for bankruptcy because they cannot pay their medical bills, are to blame for their negativity.

The ideology justifies the cruelty of unfettered capitalism, shifting the blame from the power elite to those whom they oppress."

Chris Hedges

We will always come across such personalities.  But there are some times, in some cultures, where such character traits may become not only more accepted, but socially incented, rewarded, and even fashionable.  

I think this is an important subject, because the current fiat culture in the United States has a strong element of collective and individual narcissism, expressed in the role models it upholds, the people who rise to great power, and in general, a feeling of historical and global exceptionalism that dare not be questioned.

We may do as we wish, because of who we are. This is our century. And if others object, they either have no right to do so, or are merely acting out of fear and jealousy of our greatness.

 

Hallmarks of Narcissism

 A pervasive pattern of grandiosity (in fantasy or behavior), need for admiration, and lack of empathy, beginning by early adulthood and present in a variety of contexts, as indicated by five (or more) of the following:

 

•Lacks empathy - is unwilling to recognize or identify with the feelings and needs of others

•Has a grandiose sense of self-importance (e.g., exaggerates achievements and talents, expects to be recognized as superior without commensurate achievements)

•Has a sense of entitlement, i.e., unreasonable expectations of especially favorable treatment or automatic compliance with his or her expectations

•Is interpersonally exploitative, i.e., takes advantage of others to achieve his or her own ends

•Is often envious of others or believes others are envious of him or her

•Requires excessive admiration

•Shows arrogant, haughty behaviors or attitudes

•Believes that he or she is "special" and unique and can only be understood by, or should associate with, other special or high-status people (or institutions)

•Is preoccupied with fantasies of unlimited success, power, brilliance, beauty, or ideal love

Frank Ochberg is one of my favorite modern psychologists. His primary area is PTSD. But his insights on a variety of topics is often insightful.

 

Nero: And They Who Would Be As Gods

"Do not suppose, I pray, that I am offended because you killed your mother, your wife, and your brother; that you burned Rome and send to the darkness all the honest men in your lands.

No, heir of Chaos. Death is the inheritance of men; from you other deeds could not have been expected. But to destroy one's ear for whole years with your poetry, to see your big belly on slim legs whirled about in a Pyrrhic dance; to hear your music, your dramatic orations, your doggerel verses, wretched poet of the suburbs, — is a thing surpassing my power, and it has roused in me the wish to die.

The capitol stuffs its ears when it hears you; the world reviles you. I can blush for you no longer, and I have no wish to do so. The howls of Cerberus, the dog of the underworld, though resembling your music, will be less offensive to me, for I have never been the friend of Cerberus, and I need not be ashamed of his howling.

Farewell, but make no music; commit murder, but write no verses; poison people, but do not dance; be an incendiary, but do not play on a harp. This is the wish and the last friendly advice sent to you by me —

Petronius, Arbiter Elegantiae.”

Henryk Sienkiewicz, Quo Vadis

"I am freeing man from the restraints of an intelligence that has taken charge, from the dirty and degrading self-mortification of a false vision called conscience and morality, and from the demands of a freedom and independence which only a very few can bear...

The law of selection justifies this incessant struggle, by allowing the survival of the fittest. Christianity is a rebellion against natural law, a protest against nature. Taken to its logical extreme, Christianity would mean the systematic cultivation of human failure.”

A. Hitler


"And advanced forms of biological warfare that can target specific genotypes may transform biological warfare from the realm of terror to a politically useful tool. This is merely a glimpse of the possibilities inherent in the process of transformation, not a precise prediction. Whatever the shape and direction of this revolution in military affairs, the implications for continued American military preeminence will be profound.

As argued above, there are many reasons to believe that U.S. forces already possess nascent revolutionary capabilities, particularly in the realms of intelligence command and control, and long range precision strikes.

Indeed, these capabilities are sufficient to allow the armed services to begin an interim, short-to-medium-term process of transformation right away, creating new force designs and operational concepts – designs and concepts different than those contemplated by the current defense program – to maximize the capabilities that already exist. But these must be viewed as merely a way-station toward a more thoroughgoing transformation."

The Project For a New American Century, Rebuilding America's Defenses


"Heroes. Victims. Gods and human beings.
All throwing shapes, every one of them
Convinced he's in the right, all of them glad
To repeat themselves and their every last mistake,
No matter what."

Seamus Heaney, The Cure At Troy

Echoes of the Past In The Economist - The Return of the Übermenschen

"There is not a more perilous or immoral habit of mind than the sanctifying of success."

Lord Acton

Just when you think the oligarchy could not become any more audacious.

'Slow mobility' as used in this essay from this recent issue of The Economist implies a natural class structure amongst people.

It suggest that a child would only slowly, and not usually, rise above the station of their parents and grandparents, presumably in terms of wealth, education, and opportunity. If you are born to poor parents, you are likely of an inferior genetic quality, poor stock, your success unlikely, and your servile station or poverty pre-destined.

The reason for this is because the children of 'the elite' will have 'inherited the talent, energy, drive, and resilience to overcome the many obstacles they will face in life.'

These inherited gifts are supplemented, of course, by the easy opportunities, valuable connections, and access to power. And a virtual freedom from prosecution does not hurt either, in case they have inherited a penchant for sociopathy, or something worse, along with their many gifts.

And by inference, the children of the poor will not do well, because they are genetically inferior. These are the pesky 47% who deserve to be cheated and robbed by the elite, because of the inherent superiority of the one percent. There is no fraud in the system, only good and bad breeding, natural predator and prey.

This line of thinking rests on the assumption that society today is a naturally efficient meritocracy, despite the enormous advantages of the children of 'the elite,' because they would have succeeded anyway.

I succeed, therefore I am. And if you do not, well, we shall have to do something about that drag on the efficiency of the economy and the maximization of profits. Ah, the burdens of the aristocracy, and their far flung sahibs.

This essay concerns me greatly, because such thoughts echo throughout the Anglo-American culture of late. They are whispered in the evolving mythos of those favored few who enjoy certain völkisch advantages, presumably justified by the nature of their blood.

We have seen this kind of sociology before, as the justification for the widespread looting of wealth, the ransacking of nations, and the neglect, ghetto-ization, and murder of marginalized people.

Never again. Until we allow it, because we think it serves our purposes. But the madness serves none but itself.

"Many commentators automatically assume that low intergenerational mobility rates represent a social tragedy. I do not understand this reflexive wailing and beating of breasts in response to the finding of slow mobility rates.

The fact that the social competence of children is highly predictable once we know the status of their parents, grandparents and great-grandparents is not a threat to the American Way of Life and the ideals of the open society.

The children of earlier elites will not succeed because they are born with a silver spoon in their mouth, and an automatic ticket to the Ivy League.

They will succeed because they have inherited the talent, energy, drive, and resilience to overcome the many obstacles they will face in life. Life is still a struggle for all who hope to have economic and social success. It is just that we can predict who will be likely to possess the necessary characteristics from their ancestry."

Greg Clark, The Economist, 13 Feb. 2013

Mr. Clark is now a professor of economics and department chair until 2013 at the University of California, Davis. His areas of research are long term economic growth, the wealth of nations, and the economic history of England and India.

"During this time, a growing professional class believed that scientific progress could be used to cure all social ills, and many educated people accepted that humans, like all animals, were subject to natural selection. Darwinian evolution viewed humans as a flawed species that required pruning to maintain its health. Therefore negative eugenics seemed to offer a rational solution to certain age-old social problems."

David Micklos, Elof Carlson, Engineering American Society: The Lesson of Eugenics

“With savages, the weak in body or mind are soon eliminated; and those that survive commonly exhibit a vigorous state of health. We civilised men, on the other hand, do our utmost to check the process of elimination; we build asylums for the imbecile, the maimed, and the sick; we institute poor-laws; and our medical men exert their utmost skill to save the life of every one to the last moment.

There is reason to believe that vaccination has preserved thousands, who from a weak constitution would formerly have succumbed to small-pox. Thus the weak members of civilised societies propagate their kind. No one who has attended to the breeding of domestic animals will doubt that this must be highly injurious to the race of man.

It is surprising how soon a want of care, or care wrongly directed, leads to the degeneration of a domestic race; but excepting in the case of man himself, hardly any one is so ignorant as to allow his worst animals to breed.

The aid which we feel impelled to give to the helpless is mainly an incidental result of the instinct of sympathy, which was originally acquired as part of the social instincts, but subsequently rendered, in the manner previously indicated, more tender and more widely diffused. Nor could we check our sympathy, if so urged by hard reason, without deterioration in the noblest part of our nature. The surgeon may harden himself whilst performing an operation, for he knows that he is acting for the good of his patient; but if we were intentionally to neglect the weak and helpless, it could only be for a contingent benefit, with a certain and great present evil.

Hence we must bear without complaining the undoubtedly bad effects of the weak surviving and propagating their kind; but there appears to be at least one check in steady action, namely the weaker and inferior members of society not marrying so freely as the sound; and this check might be indefinitely increased, though this is more to be hoped for than expected, by the weak in body or mind refraining from marriage.”

Charles Darwin, The Descent of Man