Gold Daily and Silver Weekly Charts - Smacked By the Invisible Hand

"People who hold strong opinions on complex social issues are likely to examine relevant empirical evidence in a biased manner. They are apt to accept confirming evidence at face value while subjecting disconfirming evidence to critical evaluation, and as a result to draw undue support for their initial positions from mixed or random empirical findings.

Thus, the result of exposing contending factions in a social dispute to an identical body of relevant empirical evidence may be not a narrowing of disagreement but rather an increase in polarization."

Charles G Lord, L Ross, Mark R Lepper, Biased Assimilation and Attitude Polarization: The Effects of Prior Theories on Subsequently Considered Evidence

This is an elegant way of saying that people tend to talk their books, and treat the truth rather lightly. And that therefore most arguments and anecdotal evidence are so selective as to be worthless because they merely support a bias, and not a scientifically based theory with a coherent model.

"Faced with the choice between changing one's mind and proving that there is no need to do so, almost everyone gets busy on the proof."

John Kenneth Galbraith

In the face of the general and woefully abysmal failure of an idea, people may cling to even outlandish theories, and listen most eagerly to the baseless rationalizations and propaganda that provide them some level of comfort and validation. And so we have the resilience of absurd notions like naturally efficient markets, trickle down economics, the virtues of regulatory nihilism, and the deflationary effect that a failing currency will have on the price of gold.

The dirty little secret is that some people don't really care for the truth when they are just issuing opinions for pay, or talking their books, their perceived self-interest. They just wish to have their cake, and eat it, and the rest of society be damned.

"Après nous, le déluge." Madame de Pompadour

That is very much the story in the US today, and the source of many of its problems. It is a house divided against itself. Honor and duty are quaint notions, trumped by virulent greed. For a few coins and a little power, truth is led down a blind alley, and quietly strangled.

And in that most cosmic twist of irony, when people love themselves and the will to power more than they love the truth, it eventually drags them over the precipice and destroys them, absolutely.

"Then you will know the truth, and the truth will set you free." John 8:32

There are no sidelines, for everyone serves something or someone, if only by default. The most significant choice we make is whom we serve, and to whom we therefore gradually bind ourselves. It is a terrible choice, with profound implications, but so often made with little thought, lightly, without a view to the consequences. We live on forever with whom we have served in this world.

Free will. Ain't it a bitch?

Have a pleasant weekend.

SP 500 and NDX Futures Daily Charts

"Mr. Obama wishes to be president of a country that does not exist. In his fantasy US, politicians bury differences in bipartisan harmony. In fact, he faces an opposition that would prefer their country to fail than their president to succeed."

Martin Wolf, Financial Times

The Non-Farm Payrolls number came in at exactly zero. I had to check the numbers to make sure of that headline, and sure enough, the number was flat month to month. Considering all the adjustments that are made to that number it was a remarkable feat indeed to have such an exact headline number.

This sets up the O-man's big speech next week, and the conversation amongst the pundits on the long holiday weekend.

The pampered princes on Bloomberg TV were touting their outrage all day, not for the dire state of the economy and jobs, but that the government might be taking some steps to rein in the banks, and fine them for some of their frauds perpetrated on the country during the run up to the financial crisis.

How dare the commoners criticize the banks! Indeed.

Gold Daily and Silver Weekly Charts

"The terrible, cold, cruel part is Wall Street. Rivers of gold flow there from all over the earth, and death comes with it. There, as nowhere else, you feel a total absence of the spirit: herds of men who cannot count past three, herds more who cannot get past six, scorn for pure science and demoniacal respect for the present.

And the terrible thing is that the crowd that fills the Street believes that the world will always be the same, and that it is their duty to keep that huge machine running, day and night, forever."

Federico Garcia Lorca


"There have been tyrannical gods, and there is the God who makes us free. Tyrant gods, nowadays, do not, as a rule, assume the names of gods. They prefer pseudonyms. But their tyranny remains the same."

Henri de Lubac


"And I looked, and behold, a pale horse, and the name of him that sat on it was Death, and Hell followed with it."

Rev 6:8

Gold and silver have been resilient in the face of the traditional bear raids ahead of the Non-Farm Payrolls number.

Perhaps they are saving their ammunition for Obama economic announcement next week.

The NFP number tomorrow might provoke a counter-intuitive reaction.

SP 500 and NDX Futures Daily Charts

Markets sputtered on light volumes and largely technical trade ahead of the Non-Farm Payrolls tomorrow.

Consensus of economists is +110,000 jobs for non-farm private payrolls, and +70,000 overall including government.

I am of an open mind to see the equity market react perversely to a low number tomorrow. It would be one of this reactions that says, 'since the number is bad, then the Fed will ease and so stocks can rally.'

Or not. This is an iffy one especially because it comes in front of a three day holiday weekend.