Jesse's Café Américain

Gold Daily and Silver Weekly Charts - Metals Oversold on Paper Metal Gimmickry

Ted Butler is looking at the data he follows, and he believes that the bullion backs are setting up the technical funds to hold the bag on the metal short positions if the metals markets turn higher. I think this is a very valid hypothesis based on the COT reports.

I have included a couple of my own technical charts as well as the usual suspects today.

I went into the market and bought some miners on weakness today and yesterday and also bought some new metals positions. I do have them hedged out a bit for now. I don't like to buy on the way down except to establish some initial positions held flexibly.

Let's see what happens.

If the wiseguys try to bull up stocks and smack metals on a bad Jobs number I will be looking for additional entry positions counter that trend into the weekend.

Today is the 45th anniversary of the assassination of Martin Luther King.

SP 500 and NDX Futures Daily Charts - Non-Farm Payrolls Tomorrow

The new unemployment claims data today was much larger than expected, which put a chill into stocks for most of the day.

Consensus for Jobs tomorrow is about 190k. I think they will come close or miss, but there might be some 'good news' on the unemployment percentage, which is meaningless since they throw out so many potential workers from their calculations.

What is saving this market is that it is so lightly traded by real investors. So the algos and momentum shops can just bat the averages around at will.

Chart-wise it was constructive that the SP futures held support but that was about it. This market looks tired, but quite a few people are waiting for a correction, so it may not come as anticipated.

I put a little volatility back on today.

After the bell HP gave Chairman Ray Lane the boot.

Cyprus Is Not So Much An Anomaly as the Template For the Next Financial Crisis

This is not so much anything new, but a concrete reminder of the breadth of systemic banking risks inherent in the Anglo-American banking structure in which depositor money is intermingled with the Bank's speculative interests.

The repeal of Glass-Steagall stripped the average person of important and time-tested safeguards against loss. Things are different now.

Any deposits you have at a bank in excess of 'insurance guarantees' are at risk in case of another financial crisis.

This exposure may include wealth you think that you own, but do not know exactly where and how it is being held. This may include 401k's and IRA's, pension plans, health insurance deposits, life insurance and annuities, and so forth.

MF Global was very instructive on how even cash deposits and physical assets backed by a certificate of ownership may be fair game for the banking system in the event of a crisis.

Nothing is perfect and foolproof, but there are degrees of safety.

And you may wish to consider that the next time something like Occupy Wall Street starts up and demands reform, don't stand by on the sidelines and join in with the orchestrated jeering from the one percent's water bearers.

Simplify, streamline, organize.

Demand serious, meaningful, and genuine reform and transparency in the banking and political system.

"The goal is to produce resolution strategies that could be implemented for the failure of one or more of the largest financial institutions with extensive activities in our respective jurisdictions. These resolution strategies should maintain systemically important operations and contain threats to financial stability.

They should also assign losses to shareholders and unsecured creditors in the group, thereby avoiding the need for a bailout by taxpayers. These strategies should be sufficiently robust to manage the challenges of cross-border implementation and to the operational challenges of execution...

But insofar as a bail-in provides for continuity in operations and preserves value, losses to a deposit guarantee scheme in a bail-in should be much lower than in liquidation. Insured depositors themselves would remain unaffected.

Uninsured deposits would be treated in line with other similarly ranked liabilities in the resolution process, with the expectation that they might be written down."

Bank of England and Federal Reserve Joint Statement on Resolving Globally Active, Systemically Important, Financial Institutions.

Why Go After the Depositors To Save 'the Taxpayers?'

One thing that puzzled a couple of people is this.

Why go after depositors, in order to save the 'taxpayers.' Aren't they the same people?

Well, obviously in the case of the European Monetary Union this is not the case. And this is the great weakness of a single currency without more comprehensive provisions for fiscal union that makes it inherently unstable.   Wealthy Germans feel no kinship with Cypriots, Greeks, or Spaniards.

But what about New Zealand and Canada, countries that have their own sovereign currencies and are viable political entities? Are the taxpayers and the depositors there essentially the same constituent base? And isn't the government responsible for regulation and policing the banks which they allow to act with a lack of transparency?   Is this not the basis of trust that sustains the financial system?

And what about the rest of the G20 that seemingly has adopted the same template of sacrificing depositors to save the gambling bankers? What are they thinking?

When a major financial institution gets into trouble it is not usually a sudden event for the most part, but plays out over a period of time. This is true from MF Global to the Popular Bank of Cyprus to Lehman Brothers.

The public does not see what is going on because the financial system is opaque. But wealthy insiders often know what is going on in their interconnected world of money. Remember the stories of the uber-wealthy who managed to get their funds out of MF Global before it collapsed? I seem to recall those friends of the people, the Koch Brothers, being mentioned.

The monied interests and their political footmen have their funds safely parked in offshore tax havens, and can move the rest around at will based on the distribution of 'asymmetrical information.'

But to the extent that they are taxpayers, they are exposed to bank failures that they may even know about, if the bailout is financed by 'the taxpayers.'

And this is what really irked the wealthy who were caught up in MF Global and Cyprus bank. They thought they were insiders.

The G20 is a tale of two economies, with one set of rules for the one percent, and another set of rules for everyone else. This new template of confiscating the savings of common depositors is just another manifestation of the one percent looting the wealth of the rest.

It may be hard to accept, but the notion of everyone in a country pulling together for the common good is not a viable concept in a crony capital kleptocracy.

And as things get worse, and their schemes start falling apart, their antics may start becoming even more blatant and more brazen, and more incredibly 'unfair.' As you know, I said that MF Global was the 'watershed event' for me.

I don't blame people for being edgy for the reasons I have stated on many occasions. The enforcement of the law is almost incredibly uneven, and the government has hidden key information, and acted in very odd ways far too many times.

When one sees something like this how can one not feel uneasy? Don't Panic, Financial Reform Will Come - By Barney Frank.    Are you kidding me? These jokers have publicly stated they don't enforce the laws they already have!

Sift everything and look at the evidence, and draw your conclusions and actions accordingly. Hysteria is contagious and has its dark attractions, but it is not helpful to you and your family's well being. Trust in God, but make everyone else show their data.