03 May 2012

Gold Daily and Silver Weekly Charts - Pete 'n' Repeat - Fed Is the 'Vampire Squid of Squids'



A bit much perhaps, ahead of the Non-Farm Payrolls.

Let's see if those are inverse H&S bottoms forming up on the gold and silver charts, or something else.





ADDITIONAL STATEMENT BY BILL MURPHY, CHAIRMAN OF THE GOLD ANTI-TRUST ACTION COMMITTEE

HEARINGS ON THE METALS MARKETS, MARCH 25, 2010


On March 23, 2010 GATA Director Adrian Douglas was contacted by a whistleblower by the name of Andrew Maguire. Mr. Maguire, formerly of Goldman Sachs, is a metals trader in London. He has been told first hand by traders working for JPMorganChase that JPMorganChase manipulates the precious metals markets and they bragged how they make money doing so.

In November 2009 he contacted the CFTC enforcement division to report this criminal activity. He described in detail the way in which JPM signals to the market its intention to take down the precious metals. Traders recognize these signals and make money shorting the metals along side JPM.

He explained how there are routine market manipulations at the time of option expiry, Non-farm payroll data releases, and Comex contract rollover as well as other adhoc events…"


Jim Grant had an interesting interview on Bloomberg television this afternoon.





SP 500 and NDX Futures Daily Charts - Jitters In Front of the Non-Farm Payrolls






The Political Continuum and the Uncomfortable Center



It will be important to keep this model in mind as we go forward.

Turmoil and crisis favor polarization, and fear brings out the extremes of both sides who unfortunately tend to make the most noise, because they are often wrong but rarely in doubt.

It will be hard to maintain a centered approach if you are independent or moderate. The far right will see you as a leftist, and the far left will see you as on the right. This does not say much about you and your thinking, but more about them and their unbalanced approach to the serious problems facing the developed nations.

It is hard to talk reasonably to anyone holding a position that is not held in reason, by its very nature. And so we might find ourselves caught in the middle as it were when the histrionics start in earnest.

Even in matters of faith, there are conflicts with the distortions of the far right, who hold faith as a rationale for their own ends rather than an end in itself. I do not judge, but I can listen. And when someone holds forth about a God without compassion and love, and when they reject His own laws, they declare themselves for what they are, rather than anything about Him.

“Thou shalt love the Lord thy God with all thy heart, and with all thy soul, and with all thy mind. This is the first and great commandment. And the second is like unto it, Thou shalt love thy neighbor as thyself. On these two commandments hang all the Law and the Prophets.”

For a believer in one God, Jew, Moslem, or Christian,  everything else is commentary, a 'how-to' and important for the individual on their particular Way, but tragically far too often a snare and a temptation, a place where people wish to hide, to avoid and resist obeying His righteous commands, and to feed their own passions and desires for power and privilege and place.

As for the irreligious far left, they are simply given in to the opposite pursuit of the will to power and glorification of the State (themselves) over all, in the manner of fascists but with a different name. The only freedom they truly desire is the freedom to dominate and enforce their wills as superior beings. They despise the common people, and that permeates their words.   They view themselves apart, and most often don't want anything to do with them after the initial struggle is done and the people have bled for them.

This is why the so-called neo-conservatives were so easily able to shift from far left to far right. They still view the world in the same distorted ways, but with different labels. As Aristotle might have said, it is all a question of balance.

Neither side wants anything to do with the individual soul and spirit of genuine love. They are 'campaigners' fully engaged in expediency for their cause, and its end is power. This is why a period of reform is so often frought with danger of one extreme or the other.

This is all to say, remember, as uncomfortable as it may seem at times, as each side grows louder and more strident, you are not alone. Our calling is to stay the course, maintain the happy medium, and keep the fires burning, and the children fed and warm.



ETFs and Derivatives Will Be the Next Trigger Event for a Major Financial Crisis


ETFs and derivatives may be fine for a trade or a hedge to a trade, but by no means are most of them that I have looked at worthy of a long term hold.  I distinguish them by their opacity, leverage, and lack of transparent audits from legitimate physical trusts.

And some of the ETFs, especially in commodities and on the short equity side, appear to be almost fraudulent both in construction and representation, and are often more instruments of manipulation and raw speculation for extracting wealth from the less sophisticated than investment vehicles. 

The great story of this financial era is the same of all the control frauds that have preceded it: leverage founded on paper claims, asymmetrical information, and the calculated mispricing of risk.

And when the ETFs fail it will be an echo of the market failure of 1929 when firms like Goldman Sachs enjoyed spectacular growth, promoting investment trusts, that blossomed late in the paper speculation of the 1920's, and became a major source of kindling for the flames.  Enough so that John Kenneth Galbraith devoted a chapter to Goldman and the Trusts in The Great Crash of 1929.

"For a long the the New York Stock Exchange looked with suspicion on the investment trusts; only in 1929 was listing permitted. Even then the Committee on the Stock List required an investment trust to post with the Exchange the book and market value of the securities held at the time of listing and once a year thereafter to provide an inventory of its holdings...

It is difficult not to marvel at the imagination which was implicit in this gargantuan insanity. If there must be madness something may be said for having it on a heroic scale."

John Kenneth Galbraith, 'In Goldman Sachs We Trust,' The Great Crash of 1929

I do not know if we are done with bubbles. We might see another yet again. It almost seems likely given the reckless apathy of the public and the passionate resistance against reform fostered by the powerful few. 

And do not presume that these monied interests will shy away from their possible self-destruction in precipitating another financial crisis and collapse.  They are emboldened by their recent brushes with disaster in the manner of the moral and emotional sickness which they share with psychopaths.  They will not respond to reason, because their motivations are not rational, not based in reason.  Was Madoff rational?  I do not think so.  He was intensely deluded and self-destructive.

Even in the ashes of another Great Depression, the powerful see the opportunity to take command and overturn the democratic republic that so inflames their swollen pride and sparks their fears, that a government of the people, by the people, and for the people has endured despite their best efforts to subvert it for themselves.  As they so proudly imagine, they are not like 'us.'  The greed to keep their ill gotten gains, and the will to power to gain more control over others, their inferiors, knows no bounds.

ETFs – The Next Accident Waiting to Happen?
By Golem XIV
May 3, 2012

Where will the next point of instability be? Not what will trigger the next liquidity and credit crunch and cause the next landslide of panic selling and losses. We can already see many candidates for the trigger. But what will be the mechanism by which it is amplified and spread?

I think that in a couple of years, unless something alters the current trends in money flows, we will come to know ETFs the way we already know the securitization and packaging of sub-prime mortgages into CDOs. I think the signs are already there to suggest ETFs are where the instability and risk is accumulating. If I am in any way correct then ETFs will be to the next stage in our on-going state of siege-mentality crisis what CDOs were to the last...

Read the rest here.