Gold Daily and Silver Weekly Charts - Is That Jamie's Ring You're Wearing?

More fruitless games in the metals today, and probably some needed consolidation.

SP 500 and NDX Futures Daily Charts - The Wages of Greed

"Men are qualified for civil liberty in exact proportion to their disposition to put moral chains upon their own appetites; in proportion as their love to justice is above their rapacity; in proportion as their soundness and sobriety of understanding is above their vanity and presumption; in proportion as they are more disposed to listen to the counsels of the wise and good, in preference to the flattery of knaves.

Society cannot exist unless a controlling power upon will and appetite be placed somewhere, and the less of it there is within, the more there must be without. It is ordained in the eternal constitution of things that men of intemperate minds cannot be free. Their passions forge their fetters."

Edmund Burke

This quote from Burke is a very fine response to the meme, 'greed is good, markets are naturally efficient, and there is no need for government regulation because people will do the right thing based on their pure and objective rationality and consideration for others.'

A practical exercise in debunking any romantic notions about the natural goodness and rationality of people is to take a drive during rush hour on almost any major American highway.

That puts me in mind of the famous quote from Sophocles, 'many are the wonders, but nothing stranger than man.'

Net Asset Value Premiums of Certain Precious Metal Trusts and Funds

BBC Interview with Nassim Taleb on JPMorgan

"It is one of the serious evils of our present system of banking that it enables one class of society, and that by no means a numerous one, by its control over the currency to act injuriously upon the interests of all the others and to exercise more than its just proportion of influence in political affairs."

Andrew Jackson, Farewell Address

Rational people keep struggling with the 'why' of all this. I think the struggle is because they start with some wrong assumptions about morally rational behaviour and motives. As Rick Santelli likes to say, traders are not moral when they are trading.

I keep coming back to William K. Black's explanation for this enormous attraction to multi-trillion dollar bets at JPM

"Financial institutions such as JPMorgan love to buy derivatives because they are opaque, create fictional income that leads to real bonuses and when (not if) they suffer losses so large that they would cause the bank to fail, they will be bailed out."

William K Black

The more I look into this and think about it, the more that Barack Obama's 'favorite banker' looks like Enron in their heyday.

I wonder how far the US will go to prevent the failure of their 'best bank' from spoiling the grand illusion, and how many lives of the poor and the middle class will be sacrificed to the god of greed and power.