Golem XIV: What Are We Bailing Out the Banks? Part Two

It is remarkable how gentle democractic freedom goes into that good night, and how easily the 'reform' movements fall prey to the monied interests. They seem to get better at this sort of thing with time.

Why are we bailing out the banks? Part two. Theory, Ideology and Failure.
by Golem XIV
October 9, 2012

In part One I argued that if we want to understand why our rulers have insisted we MUST bail out the banks we simply have to look at who owns the banks and the vast bulk of the wealth they house. And surprise, surprise the owners of most of the financial ‘wealth’ are…our rulers and their friends.

I ended by suggesting that true though I felt this was, there were also theoretical reasons why some people felt the banks must be protected at all costs -as long as the burden of paying that cost was placed firmly upon the backs of the little people, you understand...

Read the entire essay here.

Gold Daily and Silver Weekly Charts - Commercials Vs. Specs

Hats off to Dandy Don Norcini who peered into the COT structure and saw the setup for a near term 'flush' in the price of precious metals as the specs were leaning rather hard on the long side.

The pits looked like a gang fight today with the boys in black trying to mug the white knights of the metals who hung on despite fearsome odds. See the video replay below.

No way of telling if this correction is over yet. But the 'short stocks' hedge is clearly working at least for now.

For long term players this is a wiggle and not worth a second look.

SP 500 and NDX Futures Daily Charts - Retracement

Stocks were slumping today off the IMF forecast of an 'alarming risk of a global slump.'

Well Fargo was sued today for making reckless mortgages sending their stock lower.
JPM and Wells both report earnings on Friday.

Alcoa kicked off earnings season after the bell by beating on both earnings and revenues, although not by much. Still, it was 'better than expected.

YUM brands beat on earnings but was light on revenue. US same store comps were up, but were slack to lower in China and rest of the world. The market liked that. Taco Bell, Taco Bell, product placement with Taco Bell.

The market action still has an artificial feel to it.