SP 500 and NDX Futures Daily Charts - Tech Charges Higher

Stocks caught a bounce today as the markets wait for news from the FOMC tomorrow on the much awaited taper.

Money is flowing out of bonds into equities as fears cool and the market realizes that it is inevitable that bonds have topped, no matter how slowly the great trend change may come given the Fed's policy of subsidizing rates.   This once again will cause risks to be mispriced alas, and may put forward a rocky path to the unwary investor.

Have a pleasant evening.

Max Keiser and Greg Palast on Larry Summers and the Financial Crisis

"Cynicism masquerades as wisdom, but it is the farthest thing from it. Because cynics don’t learn anything. Because cynicism is a self-imposed blindness, a rejection of the world because we are afraid it will hurt us or disappoint us.”

Stephen Colbert

In our time truth comes from the mouths of comedians, because otherwise no one would take it seriously. 

Here is an interesting discussion that Max Keiser had with investigative reporter Greg Palast about Larry Summers and 'The Endgame Memo.' The interview occurred a few days before Summers withdrew his name from consideration as the next Fed Chairman.

Jeffrey Sachs has previously raised some serious concerns in a video speech to the Philadelphia Fed about his own conversations with the financial leaders of other nations, and the anger which they feel towards the US regarding the rampant financial fraud which caught their own economies in the financial crisis through the promulgation of bad paper and manipulative derivatives.

Obviously I do not know if all of what Palast is saying is correct. But the memo seems to be legitimate.  And it is also puzzling that Obama was pushing Summers so hard against such strong political headwinds, with a track record of serial disasters and potential scandals and conflicts of interest abounding.

Obama and Summers finally withdrew the nomination when faced with a revolt from their own Senators, and the normally complacent economist community, at the idea of placing Summers in charge of the Fed.    

Apparently even the culture of hypocrisy has its limits. 

I just finished reading This Town by Mark Leibovich.   In 1974 roughly 3% of Congressmen stayed in the District as lobbyists after serving their terms.  Today that number is approximately 50% of Senators and 43% of Congressmen who stay in the Beltway to become highly paid lobbyists, fueled by corporate money, cashing in on connections and influence often for the same causes which they fought against while in the Congress.  

“In poor countries, officials receive explicit bribes; in D.C. they get the sophisticated, implicit, unspoken promise to work for large corporations”

Nassim Taleb, The Bed of Procrustes

We have seen the meteoric rise of 'full service firms' that contain former high profile figures of both the Republicans and the Democrats in a partnership of cynicism, raw power, and greed.  Right or left, they offer a one stop shop that can fix any problem, fashion and implement any loophole, and promote aggressive war and excuse genocide with a straight face if there is enough money to be made in it.  

The story in the book is how broadly the politicians are co-opted by the promise of salaries in the tens of millions, even while they are still legislating.  It envelopes the journalist community and the media, and it has gotten completely out of hand. 

It is as if the government has been taken over by an army of Huey Longs of the right and the left, who operate on a principle of shameless self-enrichment.  They bamboozle the public with distracting emotional issues, while allowing the powerful interests which they serve to rob them blind. 

And the extreme moral hazard is that there are rarely any lasting negative consequences for anything if done with the right spin, since cynical competence has become rite of passage in The Club, and the fashionably proper thing to do.  The only sin is virtue, because it is bad for business. 

And if you think movements like the Tea Party are a force for reform through small government and deregulation, the problem is a bipartisan loss of shame, decency, and compassion in the cult of the self,  across the political spectrum.  Deregulation is the first tool of the financiers and their corporations.

Some years ago the French novelist Léon Bloy wrote in The Woman Who Was Poor that 'the only tragedy is that we are not all saints.' What a quaintly funny thought in our cynical culture, to aspire to high ideals and self denial.   Jed Purdy laments this loss of striving for good in his book For Common Things.  We lose our innocence in cynicism.  It is as it is.  And such acquiescence makes one blind to their own hardened hearts, deaf to the agony of the victims, and unmindful of the approaching abyss. 

In our time the prophet is the will to power,  and its god and measure is money.  The only tragedy is not to get filthy, stinking rich, even if it is done over the crushed bodies of innocent people.  And it is not enough to get richer than everyone else, but one must also see the others fail, and to be crushed.   How much more sweet then is the victory.

The suppression and co-opting of the legitimate voices for positive change is perhaps the saddest thing of all.  But it is certainly nothing new to anyone who has even a passing familiarity with the darker passages of history.  And for those who say I would never, the gods first make them mad.

The Banks must be restrained, and the financial system reformed, with balance restored to the economy, before there can be any sustainable recovery.

The American dream is dying on our watch, having been led down a blind alley of powerful self-interests and big money, and strangled.   As Roger Babson said on 5 September 1929, "sooner or later, a crash is coming, and it may be terrific."

Welcome to The Hunger Games.  And may the odds be ever in your favor.

Gold Daily and Silver Weekly Charts - JPM To Pay About $800 Million Fine for London Whale

"On Sunday afternoon, facing a revolt by his own party’s senators, Obama dumped Larry as likely replacement for Ben Bernanke as Chairman of the Federal Reserve Board...

But the fact that Obama even tried to shove Summers down the planet’s throat tells us more about Obama than Summers—and whom Obama works for. Hint: You aren’t one of them."

Greg Palast, Larry Summers: Goldman Sacked

JPM has agreed to admit wrongdoing and will pay about $800 Million in fines for concealing the huge trading losses in the case of the London Whale.

The precious metals rallied with stocks overnight as Larry Summers released Obama from having to cut him loose as a candidate for Fed Chairman.

The reason that Larry and Obama did this is quite simple.  There was broad bipartisan opposition to Summers in the Senate which precluded a confirmation. Sometimes it really is that simple.  Obama's own Senators refused to go along with it on principle and practicality.  That is how bad it was.  And that is pretty bad.

There was little other support to be gained as footing, except from Wall St insiders, with over 400 economists signing a petition that said Summers was a poor choice, giving their endorsement to Yellen. It was a policy battle that could not be won, and for which no strong allies were to be found.  One has to wonder what motivated Obama into such an awkward display in pursuit of a hopeless and apparently cynical policy decision.

Just like Syria. 

So what next. The metals were capped all day in a concerted manner. I suspect that this will continue until the FOMC announcement on Wednesday.

Let's see if any additional physical offtake is prompted by this, or if just a steady flow in background will still continues. Keep in the mind that COMEX is not a primary delivery exchange of any real importance. But the low inventories of gold bullion are more of a indicator of trends than a hard stop on anything. The COMEX will probably not be the locus of a failure to deliver. That honor is more likely to be held by the LBMA, perhaps even in response to some market dislocation in Shanghai or Hong Kong.

Have a pleasant evening.

SP 500 and NDX Futures Daily Charts - Summers' Over

Stock futures popped quite a bit higher overnight as the announcement that Larry Summers was no longer in play gave heart to the monetary doves, and hopes of QE for the foreseeable future.

Stocks gave much of that overnight hype back during the day as AAPL continued to lead tech lower, and the SP sagged.

Economic Calendar - FOMC Decision On Wednesday Highlights This Week In Economic News

The FOMC decision on September will be a highlight economic event for the week, since it is widely expected that the Fed will make some announcement on the taper.

Thinking runs to a small cutback in new purchases of debt in the 10 to 15 billion dollar per month area.

Bloomberg TV was beaming with the econmic numbers from this morning and a purported manufacturing renaissance. . I am glad that I looked them up. They missed the broad consensus in both Empire Manufacturing and in Industrical Production.

TIC flows might provide a surprise, or not, but the FOMC will be the big mover if there is one, excepting of course some black swan number which is not likely by definition.

NAV Premiums of Certain Precious Metal Trusts and Funds

The price capping in the precious metals is particularly obvious, and may be associated with a key FOMC meeting announcement on Wednesday.

Given that there is a steady offtake of physical supply the antics do not matter so much to the longer term.

Summers Withdraws Himself From Fed Chairmanship Consideration

"...the biggest risk we can take is to try the same old politics with the same old players and expect a different result."

Barack Obama, Democratic National Convention 2008


"Like a dog returns to its vomit, so a fool repeats his folly."

Proverbs 26:11

Larry Summers withdrew himself from the nomination as Fed Chairman today, in order to save Barack Obama from the embarrassment of having to withdraw it himself in the face of staunch opposition from a very large number of economists and Congressional members of both parties.

That the consideration for Summers as Fed Chairman went as far as it did despite such broad opposition, far beyond that of just economic progressives, demonstrates the overall poor judgment that the President has shown in economic matters from the very beginning of his presidency.

Obama has a remarkable predilection for repeatedly ignoring the wishes of his electoral base and the sound principles of genuine reform in favoring the wishes of the biggest banks on Wall Street and the monied interests.

This makes it more likely that Janet Yellen will be the next Fed Chairman, which would mark a move towards more monetary easing as Yellen is an inflation dove.   It does not speak to the regulatory activity of the Fed which has been accommodative towards the Big Banks.  But perhaps not as much as it might have been under Summers who is a long time Rubinite and noted for an aggressive bias against financial regulation. 

From the Globe and Mail:

Obama accepts ex-aide Summers's decision to not seek U.S. Fed chairmanship
WASHINGTON — Reuters
Sunday, Sep. 15 2013, 4:54 PM EDT

U.S. President Barack Obama said on Sunday he has accepted the decision of his former top economic aide Lawrence Summers to withdraw from consideration as chairman of the Federal Reserve.

“Larry was a critical member of my team as we faced down the worst economic crisis since the Great Depression, and it was in no small part because of his expertise, wisdom, and leadership that we wrestled the economy back to growth and made the kind of progress we are seeing today,” the President said in a statement.

“I will always be grateful to Larry for his tireless work and service on behalf of his country, and I look forward to continuing to seek his guidance and counsel in the future,” he said.

Dear Mr. President,

I am writing to withdraw my name for consideration to be Chairman of the Federal Reserve.

It has been a privilege to work with you since the beginning of your Administration as you led the nation through a severe recession into a sustained economic recovery built on the policies to promote employment and strengthen the middle class.

This is a complex moment in our national life. I have reluctantly concluded than any possible confirmation process for me would be acrimonious and would not serve the interests of the Federal Reserve, the Administration, or ultimately, the interests of the nation’s ongoing economic recovery.

I look forward to continuing to support your efforts to strengthen our national economy by creating a broad based prosperity and to reform our financial system so that no President ever again faces what you and your economic team faced upon taking office in 2009.

Sincerely yours,

Lawrence Summers

Andrew Bacevich: The New American Militarism

"To go beyond the bounds of moderation is to outrage humanity. The greatness of the human soul is shown by knowing how to keep within proper bounds. So far from greatness consisting in going beyond its limits, it really consists in keeping within it."

Blaise Pascal

Bacevich is quite insightful. I should point out that the actual talk itself is about 25 minutes or so. The rest of this video is questions from the audience.

Some of his off the cuff eloquence in the second part in which he answers questions is remarkable. Don't be put off by the questions which are hard to hear.

One sentence which he throws out as part of a long answer seems to be a nice summation of his major hypothesis.

"The unrealistic expectations of what military power can do, and the recklessness with which we use it, don't serve the nation's interest, or the interests of stability more broadly."

While I like most of what he says, and I understand the point he makes about the role citizen-soldier in the latter part of the questioning in response to some other questions, I think he is assuming that the reinstitution of a draft would bring about more political accountability. His notion is that more parents would demand accountability from the government if more of their children were involved.

I think that assumption is optimistically mistaken. People's wealth is broadly being taken by the government and too often abused. There is no more level of accountability in this that I can see, given the current distance of the monied elites from the root source of the public will. I think they have become so isolated in their group thinking that they have lost touch with the people. And this will be resolved at some point, as it always does when the powerful forget their kinship with mortality and their obligations to others.



As you may have read, Bacevich is a self-described 'fan' of Reinhold Niebuhr. I looked up this quote from Niebuhr, and thought it might be particularly appropriate for us at this time.  The sense of social cohesion and interdependence amongst people, along with a few other traditional perspectives, seems to be given too shallow consideration in our era of the ascendancy of the narcissistic few and the cult of unbridled greed.

“Nothing that is worth doing can be achieved in our lifetime; therefore we must be saved by hope.

Nothing which is true or beautiful or good makes complete sense in any immediate context of history; therefore we must be saved by faith.

Nothing we do, however virtuous, can be accomplished alone; therefore we must be saved by love.

No virtuous act is quite as virtuous from the standpoint of our friend or foe as it is from our standpoint. Therefore we must be saved by the final form of love which is forgiveness.”

Reinhold Niebuhr, The Irony of American History

COMEX Deliverable Gold Bullion Has Plunged By 78% in 2013 - Claims Per Ounce Highest On Record

The last time that the claims per ounce were nearly this high was in the late 1990's. At that time the central banks had to intervene to keep one or more bullion banks from faltering.

It occurred during a period of coordinated bullion selling from the central banks into the market under the Washington Agreement, culminating in the notorious gold dumping known as Brown's Bottom.  Their gold may have been sold as well, but at least the Germans still have a receipt. 

That selling failed to hold the line, and shortly thereafter gold began its great bull market run. 

"We looked into the abyss if the gold price rose further. A further rise would have taken down one or several trading houses, which might have taken down all the rest in their wake.   Therefore at any price, at any cost, the central banks had to quell the gold price, manage it."

Sir Eddie George, Bank of England, reportedly in private conversation, September 1999

The first chart below shows that pressure on available supply in owners per ounce rather nicely.   Nick Laird, the maestro of charts from Sharelynx.com, was kind enough to go back and pull all the available data. It helps to complete the picture don't you think?

One difference this time is that the fellows who examine the more detailed reports tell us that the big boy of the bullion banks, JP Morgan, is said to have already liquidated their large short position and gone net long gold. Perhaps they are well advised.

Deliverable 'dealer' gold, known as registered gold at the COMEX, has plunged a remarkable 78% during the vicious price smashing of gold in 2013.

This decline in gold available for delivery has not been matched by a similar decline in contracts bidding for that gold, known as the open interest.

Therefore the number of contracts for each ounce of deliverable gold has now reached a new all time high of about 57.8 claims per ounce, a level that has not ever been seen since Nixon closed the gold window.

There was another big buildup in the claims per ounce that occurred just before gold began its big bull market run in 2000.    Some contend that this drain in dealer gold was the result of a last ditch effort to the hold the price of gold lower before the market broke and the price began its remarkable run.

But given that the banks became net buyers of gold around 2008, as shown in the third chart below, it does not seem likely that the Bank of England or the western central banks will sell bullion into the market to save the overleveraged speculators again.

Recently the Federal Reserve was unable to comply with a request from the Deutsche Bundesbank to return the German national gold which had been held in custody in New York. The vault seems to be a bit on the thin side in general.  I am sure all the gold is there, it is just that we live in an age in which multiples of rehypothecation for our financial assets held in trust are de rigeur.   All the finest financiers are doing it without fear or regret, even when it occasionally decimates their customer accounts or shakes the global economy to its foundations.

Also included below is a peek at the registered inventories of all the COMEX warehouses.  Some of the declines are impressive.  What a remarkable coincidence.

There has rarely been a dull moment since they knocked down Glass-Steagall. It will be interesting to see what happens next.   This has been so much fun that it hard to know whether to crack open a bottle of champagne, or to make a run for the border.

We'll probably have to wait for the equity market to break until after Goldman brings out the Twitter IPO.  Priorities.

Have a pleasant weekend. See you Sunday evening.

Gold Daily and Silver Weekly Charts - Gold and Silver Pressured All Day With a Big Reversal Into the Close

There was quite a reversal late in the day as the precious metals, which had been under pressure, rallied dramatically into the close.

The reversal seemed to coincide with the breaking news that two whistleblowers have come forward from JP Morgan with allegations of market manipulation in the metals by the Bank.

Here is intraday commentary on this news item.

This uncertainty and mystery over the CFTC and their actions in overseeing the markets and investigating these serious allegations is approaching the absurd. It is time to clear the air.

Have a pleasant weekend.

SP 500 and NDX Futures Daily Charts - Friday the 13th

The markets were skittish a bit before the weekend, although VIX shows that complacency is still the order of the day.

There are some interesting cross currents between tech and the financials.

We should hear something about the taper from the Fed at their meeting this month.

Have a pleasant weekend.

A Shocking Allegation From Andrew Maguire: CFTC Must Respond Publicly, Or Answer To Congress

Andrew Maguire,  a British national who had testified before the CFTC in a public forum about the manipulation of silver a few years ago, has leveled a serious charge against the bank JP Morgan in a King World News interview.

Maguire says that he knows that two JPM employees have come forward as whistle blowers, and have sought legal aid and protection, alleging that they have testimony and evidence that J P Morgan has willfully manipulated the gold and silver markets.

I do not know Andrew Maguire. I do not know if what he is saying is accurate or not.

But this ought not to be a matter of 'belief' or uncertainty.   It is a matter of evidence and law and there are people in Washington who are paid to be informed about this on the public's behalf.

After the stunning scandal that emerged in the wake of Bernie Madoff's confessing to one of the largest Ponzi schemes in history, it came to light that the SEC had long been suppressing investigation into allegations of his crimes, and was ignoring evidence which had been supplied to them over a period of years by Harry Markopolos.

And now we have what could be a similar situation. 

Andrew Maguire claims that he has supplied evidence of market manipulation to the CFTC for some years, and further and even more damningly, two JPM employees have come forward and made similar allegations, with evidence that says they are correct.

I think it is not possible for the CFTC and the Obama Administration to continue to ignore such public allegations. The CFTC may use the shield of an 'ongoing investigation' since they have been looking into charges about this matter in the silver market going on five years now.  They have missed the date by which they promised results.

To continue to ignore this widespread and public questioning of the integrity of the markets that affect the whole world is not acceptable.

I am a little surprised that the appropriate committees in Congress have not invited Bart Chilton and chairman Gary Gensler to appear before them, and ask if they have any such evidence, and if these allegations are substantial.   Would this be Darrell Issa's Committe on Reform or the Banking Committee of which Senator Elizabeth Warren is a member.

Here is Congressman Darrell Issa's contact information:

DC Phone: 202-225-3906
DC Fax: 202-225-3303
Contact Representative Issa: http://issa.house.gov/contact/contact-me

Here is Senator Elizabeth Warren's contact information:

DC Phone: 202-224-4543
DC Fax: 202-228-2072
Contact Senator Warren: http://www.warren.senate.gov/?p=email_senator

Since JP Morgan has been under investigation for manipulation in the energy markets, and since there have been repeated scandals in the willful manipulation by banks and traders in LIBOR and key derivatives metrics, I think that this cannot be dismissed out of hand as a conspiracy. If there is evidence the people deserve to know it.

I suggest that you contact your Congressmen and Senators asking them to support such an inquiry.   You can find your congressional contact information here.

If you are not a US citizen, I suggest you contact your domestic representative and/or the US embassy in your country and express your concern over these charges.  Or perhaps you can drop an email to Senator Warren who seems to take these sorts of issues very seriously. At the least they could send a letter to the commissioner on behalf of the public and ask about this for the record.

Here is the link to Maguire's charges.  You may wish to include this link in your message.

Morgan Whistleblowers Allege Bank Manipulates Gold and Silver

In a stunning development, two JP Morgan whistleblowers have confessed that the bank manipulates the gold and silver markets. This is truly a shocking admission by the courageous JP Morgan whistleblowers. In a blockbuster King World News interview, London metals trader Andrew Maguire told KWN that the two JP Morgan employees came directly to him with hard evidence that the bank was actively manipulating the gold and silver markets.

This is a truly catastrophic event for JP Morgan, which up to now has denied manipulating these markets. Below Maguire takes KWN readers around the world on a trip down the rabbit hole as he discusses how he led the two JP Morgan employees to turn over the evidence to a law firm which specializes in high profile whistleblowers, and also to the CFTC. According to Maguire, the CFTC has virtually buried this information. Is this a cover up, or the next LIBOR scandal about to be exposed? Below is what Maguire had to say in this blockbuster interview...

Moyers: Andrew Bacevich On US Policy in the Mideast and Syria

I found this to be interesting. I have not encountered Mr. Bacevich and his ideas before.

Andrew J. Bacevich is Professor of International Relations and History at Boston University.

He graduated from the United States Military Academy at West Point in 1969 and served in the United States Army during the Vietnam War, serving in Vietnam from the summer of 1970 to the summer of 1971. Later he held posts in Germany, including the 11th Armored Cavalry Regiment; the United States; and the Persian Gulf up to his retirement from the service with the rank of Colonel in the early 1990s.

Bacevich conceived The New American Militarism not only as "a corrective to what has become the conventional critique of U.S. policies since 9/11 but as a challenge to the orthodox historical context employed to justify those policies."

He holds a Ph.D. in American Diplomatic History from Princeton University, and taught at West Point and Johns Hopkins University before joining the faculty at Boston University in 1998.

Gold Daily and Silver Weekly Charts - Here Comes the Twitter IPO After the Bell

Just when you think that they cannot do anything more foolish, there they go again.

Some joker dumped 2000 contracts on the gold market in the quiet, early morning trade and took it down so hard the market hit limits and halted.   Cat burglars wearing bell suits and clown shoes.  The rest of the day was about the same.

Here is James McShirley's count of the at market mayhem:

2:55 AM: 4,330 contracts dumped, gold smashed $10.70
8:31 AM: 2,842 contracts dumped, gold smashed $ 5.60
9:00 AM: 2,595 contracts dumped, gold smashed $ 2.00
9:01 AM: 2,768 contracts dumped, gold smashed $ 3.00

Blatant frauds will continue until confidence and support for the status quo and markets return.

They just do not get it. 

After the bell the news that Twitter is filing its IPO came out.  Goldman Sachs will be the lead underwriter.  That ought to help support the equity market until they squeeze that one out.

Let's see if the statistics from the COMEX tell us something interesting tonight, other than they were selling more gold that they don't have and probably can't get.

PostNote:  there was no movement of bullion in or out of the COMEX warehouses yesterday.

I have to say, though, that analyzing US metals market data is starting to be like analyzing Bernie Madoff's quarterly returns to get a sense for fair market value performance.  Or counting cards in a game of three card monty.

How are the mighty fallen.

Have a pleasant evening.

SP 500 and NDX Futures Daily Charts

Today was particularly nauseating. No not because of the action on the metals markets.

Hank Paulson was on Bloomberg TV today explaining how everything he did for the Wall Street banks, he was really doing for the common people like you.  He is out touting the movie, Hank.

I would like to see Hank visit a few town meetings in different areas around the country, perhaps some rural areas down South and out West, and lay out that I was really helping you line, so the people could personally thank him for all that he has done.

He *might* actually believe what he is saying. But I would not bet on it. 

Have a pleasant evening.

Gold Chart Intraday - Is the COMEX Still 'The Market' For Anything Except Paper?

There is some talk that JPM has 'cornered' the gold market on the COMEX.

This is based on COMEX released data.

I don't know. That might be technically correct, but it overlooks one important fact.

The 'COMEX' is no longer the 'gold market' or the 'silver market.'

Given that the COMEX could supply the gold markets around the world for about two months before rolling over and shutting down, I think it more of a conceptual market than THE market.

Like some outworn custom, people still pay attention to the paper prices on the COMEX out of force of habit. But the locus of buying and selling of the actual product has been moving elsewhere for some time now. 

The LBMA can make a better claim to the title of 'the market' for precious metals, but even that is slipping away.  It is just harder to see because the association is so opaque with regard to its statistics on sales and inventories.   

But I think this current arrangement is more historical than practical, given the weakness of the regulatory climate in the US and the UK.   Is there any price discovery and market clearing going on in New York, or it is just some big game of Liar's Poker with a vestigial connection to reality?

What good are a set of nice statistics when what they represent is a pretty facade over a hollowed shell?  And given the lack of position limits and basic limitations on price manipulation without consequences in physical delivery it is unfortunately taking on the character of a control fraud.

Given all the scandals that have been surfacing since the market rigging of real goods and services by Enron I don't think that is such an unreasonable point of view.  These jokers are off the hook, and out of control.

If the NYC and London punters keep this up, the price of the metals will diverge from the COMEX paper prices, like the currency markets in the eastern bloc and Russia widely diverged from official exchange rates in the 1990's. 

But, they never listen.  Once confidence is broken, it is very hard to regain.  Even in a culture that holds that there should be no consequences for extra legal actions by wealthy and powerful insiders.

NAV Premiums of Certain Precious Metal Trusts and Funds - Shaking the Bushes, Selling What They Don't Have

In this case the bushes are the GLD and SLV ETFs, which are getting shaken today to try and shake loose some physical bullion for the hard up COMEX pit crawlers.  

It also will probably shake loose the weak hands and toss up some open interest to lessen the pressures on delivery.

The last time they tried this is did not work out well, because they forget that COMEX is a sideshow to the real precious metals markets which have moved offshore.
 
The gold silver ratio is back up to 60 which is on the high side.

So today we are seeing a bear raid in the metals that started last night.

These guys remind me of the little girls, years ago when they used to dress up like ghosts and jump out at us and say 'boo!'  About the third or fourth time it became a little hard to fake a reaction.

But I don't think the little girls took themselves so seriously as these Wall Street scamps.

Voiceover from Aziz Ansari:  Oh no, the COMEX is selling more gold that they don't even have.  I'm so afraid.

Perhaps this price drop will allow JPM to squeeze some additional bullion out of GLD, which they can add to their stash.

"He who sells what isn't his'n,
Must buy it back, or go to prison."

Daniel Drew

Claims Per Ounce of Deliverable Gold at the COMEX Rise to New High of 57.6

Based on yesterday's activity, the claims per deliverable ounce of gold on the COMEX has risen to a new high of 57.6 contracts per ounce.

As you know it is highly unlikely that all contract holders would ever stand for delivery.

But it is a useful indicator of how the open interest is going relative to available inventory. It suggests that higher prices may be in the offing.

The last two times that we saw these extremes there was a meaningful trend change in the price of gold from lower to higher.  This makes sense because it is higher prices that would cause those who are merely using the COMEX warehouses for storage to offer their bullion for potential sale.

The extremes we are seeing now are quite new since the bull market began back in 2003.

Let's see what happens.   But the message appears to be written on the wall.

Weighed, and found wanting.

Stand and deliver.

Gold Daily and Silver Weekly Charts - Psychopathy Means Never Having to Say You're Sorry

Or even feel sorry for that matter.

Regret and remorse are the stuff of the untermenschen. the ordinary people, as both faith and conscience come from a simple sense of ourselves as we really are, and a redeeming concern for others.

The Recovery™ is proving to be a highly selective experience, and the masters of the universe remain rampant on a field of greed.

“Though this be madness, yet there is method in it.”

The precious metals market is showing signs of wear.  There is some fairly pointed intraday commentary on that subject here.

Speaking of the importance of the day, it is all too easy to allow a tragedy like 911 to become a mere abstraction or a political symbol.  After all, we are a conceptualizing species, often lost in the heat of the present.  It is surprising how quickly and easily we forget, and stumble, and get our priorities all wrong.  But always so self-importantly. And that is what makes us so funny.

I remember, on that day of momentous events, being amazed at how quickly the class mothers at our grammar school got together to handle the very practical problem of what to do about children who might not have a parent coming to pick them up after school that day.  And it did happen. 

I remember the story of the woman who took one of her husband's suits out of the closet, and laid next to it on the bed, to embrace the last faint smell of him from it, as she gave herself over to her grief.  I am only now beginning to truly appreciate that as the shadows lengthen.

These are the little, human things that form the rich texture and meaning of life.  It is this mere but precious humanity that is so often wholly lost to the self important ego and actions of the ubermenchen, to their everlasting shame, and special place in the hereafter. 

Essere umano, to be human.   Memento mori,  and remember thou art also mortal, arrogant dust.  I think we have forgotten this once again.  Whom the gods would break, they first make mad.

So in keeping with the day, let's all try to remember what is important, and what truly lasts.

"Gentleness is everywhere in daily life, a sign that faith rules through ordinary things...Even in a time of elephantine vanity and greed, one never has to look far to see the campfires of gentle people.  Lacking any other purpose in life, it would be good enough to live for their sake."

Garrison Keillor

Have a pleasant evening.

SP 500 and NDX Futures Daily Charts - Madness Rampant On a Field of Blind Arrogance

There was an interesting divergence between the financials and tech today. VIX continued its sharp decline.

This eerily reflects the cognitive dissonance between the frivilous and self-centered land of make believe, and the land of real people and things.

It is a nice emblem for NY-Washington-London metroplex and the rest of the world. It almost reminds one of the relationship between the Capitol and the Districts in The Hunger Games.

It goes without saying that this will end badly, and the collected leadership of the intelligentsia will express complete astonishment and surprise.

There is nothing more fearful to behold than the destructive potential of a bureaucrat or central banker blinded by web of their own willful making.

The fearful madness of bureaucrats and central bankers blinded by a web of their own willful making.