SP 500 and NDX Futures Daily Charts - Let It Be Written, and Let It Be So

"A society becomes totalitarian when its structure becomes flagrantly artificial: that is, when its ruling class has lost its function but succeeds in clinging to power by force or fraud. Such a society, no matter how long it persists, can never afford to become either tolerant or intellectually stable..."

George Orwell

This is the underlying message in the  young adult three book series The Hunger Games.

Stocks were able to rally higher today, back almost to levels of a few weeks ago,  on the better than expected estimate of GDP for the 3Q.     That GDP number was dependent on a few one offs like government spending, largely of the military kind, and on a more favorable trade balance.

Excelsior.

The exercise today was very much about proving that the Fed did the right thing in ending QE III, and that there need be no large decline in equities.  There is no coincidence in any of this.

There is a natural tendency to be optimistic and to wish for good things to happen.  The difficulty is when those steering the ship keep making poor decisions and following policies that are not productive.  And this unfortunately is the case today.

What will it take to change my mind?  A real media wage that is growing commensurate with GDP, so that domestic consumption can also grow and fuel the real economy without artificial stimulant and welfare spending on corporations and the military-industrial complex.

Fair enough?  Until then in my personal judgement the economy is neither self-sustaining nor stable. Yes I understand about lags.  And six years is one hell of a lag for those not receiving the beneficence of a trickle down corporatist welfare state.

Have a pleasant evening.

NAV Premiums of Certain Precious Metal Trusts and Funds

I did not have the opportunity yet to update the metals holdings or cash levels in the below.

Gold Daily and Silver Weekly Charts - FOMC and the Usual Shenanigans

The Fed announced the end of QE III today as had been expected by almost everyone. And after a pause on the news, the dollar soared, precious metals and oil dumped, and stocks slumped, although stocks came back to nearly unchanged by the end of day.

See the commentary on stocks below for more about what the Fed said today.

Nothing has changed. Not one thing. And that is about nine-tenths of the problem that is causing this six year non-recovery for Main Street.  

We still have a rotten financial system acting like an unproductive tax and a drag on the real global economy, sowing malinvestment and distortions in whatever it touches and then some. 

Have a pleasant evening.

SP 500 and NDX Futures Daily Charts - The Downward Spiral of Dumbness

"The Committee anticipates, based on its current assessment, that it likely will be appropriate to maintain the 0 to 1/4 percent target range for the federal funds rate for a considerable time following the end of its asset purchase program this month, especially if projected inflation continues to run below the Committee's 2 percent longer-run goal, and provided that longer-term inflation expectations remain well anchored.

However, if incoming information indicates faster progress toward the Committee's employment and inflation objectives than the Committee now expects, then increases in the target range for the federal funds rate are likely to occur sooner than currently anticipated.

Conversely, if progress proves slower than expected, then increases in the target range are likely to occur later than currently anticipated."

FOMC Statement, Oct 29, 2014

I think Bob Pisani literally squeaked when he read 'sooner' in the underlined portion of that FOMC statement, asserting that this was a 'hawkish' statement indeed.  He did not bother to reference the next sentences that begins, 'conversely.'

And I think the wiseguys knew that the Fed was basically saying nothing new, but throwing a farewell bone to the hawk Plosser on the committee, who won't be around after the first of the year, and the complexion of the FOMC turns decidedly more dovish in nature.

The US dollar spiked, but forex has a notorious carney game intraday, but that moved key commodities like gold and oil in the 'right direction' which is down. 

And the hosts and guests on bubblevision continued to burble on about 'rate increases' and 'amazing corporate profits' for the rest of the afternoon.

I am sure we will have loads of fun speculating about what the Fed will do next for quite some time.

Let's see how the rest of the world takes the news that the Fed has its hand on the tiller of the world's economy, to take it where they will.

I think the Fed will move when something forces their hand, and not one minute before.  And I will be glad but surprised if it is a booming economy fueled by organic growth and domestic consumption  next year.

Have a pleasant evening.