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The US bond markets were closed today for Columbus Day, but the equity markets and futures were open for trade. The bond traders tend to be the adults, and the equity markets the domain of the kids. So the adults had the day off by and large.
A light day with a theme of weakness based on concerns for the start of earning season and the unfolding tragedy that is Europe, and the western financial system in general.
So what next. We have to wait and see which way things break in the short term. It is just that simple.
Based on the printing of money the path of least resistance is higher, but the macroeconomic reports present a bit of a headwind, and the shakiness of the global governance by the financiers gives the wobbles to asset values.
Mom and pop are largely sitting this bubble in stocks out. Of course gold and silver are still a long term hold. One cannot tell if it is wisdom for the smaller spec to shun the equities, or just empty pockets that make it so.
Wells Fargo and JPM report earnings on Friday. The financials are probably the locus of this particular asset bubble. Well those jokers, and of course, AAPL. The banks make AAPL or even Facebook look like blue chip electric utilities, substance-wise.
But Bennie has their backs, and everyone else has been encouraged to look the other way, so they may do well. There is a meme that says that if the banks failed in the 1930's, the way to prevent another Depression is to keep them from failing this time by stuffing them, or at least a favored few, with money, the public outrage notwithstanding.
That is what is commonly known as the 'cargo cult economics' subcategory of the neo-liberal school, and makes efficient market theory look like the theory of relativity. At least they are not outright liquidationists, which is the 'intellectual enema' subcategory of the human sacrifice school of economic thought.
That is how things stand in a thumbnail view: nuttier than usual, but nothing we have not already overcome in the past. Leadership and attitude make all the difference. And we are poorly led, and short sighted greed prevails.
About 400 million shares were traded on the NYSE today as the adults took a holiday from the bond market and the kids came in to trade equities.
Nothing done really. Earnings kick off this week. Widespread concerns about slowing growth. The pigmen are rampant.
Facebook was cut to sell today by an analyst who had concerns about their ability to grow future revenues. Is the Facebook IPO some sort of watershed event? We will not know for a few years, but Benny will almost certainly to do his best to keep the party going.
The woods decay, the woods decay and fall,
The vapours weep their burthen to the ground,
Man comes and tills the field and lies beneath,
And after many a summer dies the swan.
Alfred Lord Tennyson, Tithonus
This is a classic "wash and rinse cycle" within a greater uptrend. Whether it may continue to be so could be determined by the new earnings cycle that begins this week, the dilemma that is Europe, or the ongoing political process of financialisation.
Far from being a capital forming mechanism, the US equity market has been allowed to degenerate, once again, into a vehicle largely dominated by frauds and schemes of wealth transferral.
A person might as well brag of making a fortune in the stock market by short term speculation in the same manner that a first rate pickpocket might boast of making a rich harvest in the town square during some public event, distracting by spreading rumours, alarms, and other misdirection.
Having made their wealth in a generational fraud, the oligarchs mean to keep it by any and all means, including beggaring the world if only to make their own fortunes shine brighter.
This is capitalism in decline, as justice fails, or more precisely, is bought into silent partnership. And the killing of conscience in financial things opens a Pandora's box of maladies of the spirit and the madness of hardened hearts.
And there is no finer symbol of this decline than the current electoral contest, which appears but a Hobson's choice between the corruptly lax magistrate and the pre-eminently audacious highwayman.
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