SP 500 Futures - A Closer Look - Miseria Ex Machina

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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Net Asset Value Premiums of Certain Precious Metal Trusts and Funds

Weekend Reading - Ode to Financial and Political Narcissists and Sociopaths

The expense of spirit in a waste of shame (Sonnet 129)
by William Shakespeare

The expense of spirit in a waste of shame
Is lust in action; and till action, lust
Is perjured, murderous, bloody, full of blame,
Savage, extreme, rude, cruel, not to trust;
Enjoyed no sooner but despisèd straight:
Past reason hunted; and no sooner had,
Past reason hated, as a swallowed bait,
On purpose laid to make the taker mad:
Mad in pursuit, and in possession so;
Had, having, and in quest to have, extreme;
A bliss in proof, and proved, a very woe;
Before, a joy proposed; behind, a dream.
     All this the world well knows; yet none knows well
     To shun the heaven that leads men to this hell.

This video below illustrates why the rational expectations model of efficient markets is a dangerously misinformed theory, and perhaps a deadly rationalization for plunder. The theory, like so many flawed economic models, discards the outliers of the norm, who in the real world are in sufficient number to have a statistically significant effect on the outcome and the shape of the market.

And this is why self-regulation without objective oversight, the rule of law, and justice for all in equal measures is a path to self-destruction.

Power attracts certain personality types, and organizations that value power, or ruthless determination to achieve results at any cost, often end up being run by people with the mentality of predators. And the predatory environment can become self-reinforcing and self-sustaining given time.

“A nation can survive its fools, and even the ambitious. But it cannot survive treason from within. An enemy at the gates is less formidable, for he is known and carries his banner openly. But the traitor moves amongst those within the gate freely, his sly whispers rustling through all the alleys, heard in the very halls of government itself.

For the traitor appears not a traitor; he speaks in accents familiar to his victims, and he wears their face and their arguments, he appeals to the baseness that lies deep in the hearts of all men. He rots the soul of a nation, he works secretly and unknown in the night to undermine the pillars of the city, he infects the body politic so that it can no longer resist.

A murderer is less to fear.”

Marcus Tullius Cicero

William K. Black On the Failure to Reform the Financial System

Obama's most striking betrayal of his base and his mandate to reform is in his kid gloves treatment of one of the worst financial crimes in American history. And of course he is not alone. The Congress is a disgrace, falling to historic lows in their public approval. The Republicans are shameless in their obstructionism, and there is not a leader worthy of the name amongst the Democrats.

I struggle quite a bit with his motives, constantly arriving at the conclusion that he is held captive by the system that rewarded and elevated him.   Ignorance does not suffice, and moral cowardice does not seem appropriate.   More likely is the expedient amorality of the modern managerial mind.   The deal is what is important.  

And sadly enough, there is no real alternative in Romney, who as the modern predatory financial manager will say or do anything to make the deal happen.   And the pigmen are licking their lips at the thought that their man might take the reins.

This is the weakness of the two party system, and a Presidency that, excepting for the occasional impeachment, allows a President to reign for four years once he (or hopefully some day she) manages to persuade the electorate to accede in their ascendancy to power.

"The debate revealed that Obama does not stand for anything positive when it comes to the banksters or distressed homeowners. Geithner is not a banker or a technocrat. He is an American apparatchik who rose by attaching himself to powerful political patrons and telling them what they want to hear. That reflects badly on Obama.

Geithner gave Obama the answers Obama wanted to hear – we must not act against our largest donors (and Geithner’s most likely future employer), the banksters, by holding them accountable for their frauds because if we were to do so the economy would collapse. Geithner’s answer, which became administration policy, was to lie about the banksters’ role in causing the crisis and the financial condition of the banks.

Obama should hold Romney accountable for his endemic lies during the campaign and debate, but he would be in a better position to do so if he fired Geithner and Holder, ended his administration’s lies about the banksters, and reversed the administration’s unjust and destructive financial policies.

Obama needs to stand for something – he should stand for the American people against the banksters and the SDIs. The irony is that by following Geithner’s advice Obama acted dishonorably and foamed the runway for Romney’s lies about the financial crisis."

Read the entire essay by William K. Black here.