Stocks and Precious Metals Charts - Pop Go the Weasels

“To escape the pain caused by regret for the past or fear about the future, this is the rule to follow: leave the past to the infinite mercy of God, the future to His good Providence, and give the present wholly to His love by being faithful to His grace.”

Jean-Pierre de Caussade, Abandonment to Divine Providence


"Wonderful providence indeed which is so silent, yet so efficacious, so constant, so unerring.  This is what baffles the power of Satan.  He cannot discern the Hand of God in what goes on; and though he would fain meet it and encounter it, in his mad and blasphemous rebellion against heaven, he cannot find it."

J. H. Newman

He cannot find it because he lacks the faith to see it, and the love to apprehend it.  He is blinded by his pride.

Welcome to October, the month of unexpected falls from heights, and stock market tears.

Stocks were hard charging higher this morning on the news that Canada and the US had come to an agreement on NAFTA II.

But alas, the euphoria wore off in the afternoon, and stocks finished little changed, with the broader small caps getting spanked in particular. Not a good sign for bully.

Gold and silver were lower on the 'risk on' feeling this morning, but recovered quite a bit as the day wore on.

We will be having a Non-Farm Payrolls report on Friday for the month of September.

And a beautiful early Autumn day it was here, the kind of weather that beckons you outside and away from the hysterics of ideologues and the privileged, pampered professionals.

Hell is a stifling dark room behind a door that is a hardened heart, locked from the inside. 

Have a pleasant evening.

The Problem of Corruption in the Professions and the Pressure to Remain Silent

"This is the Golden Age of fraud, an era of general willingness to ignore and justify the wrongdoings of the rich and powerful, which makes every lie bigger and widens its destructive path.”

Reed Albergotti

There is tremendous pressure on professionals to remain quiet about corruption, sometimes obvious and pervasive, in their own professions.

This video discusses a shocking level of systemic corruption in Canada.

US Debt and the Restraint of a Gold Standard

Although FDR ended the use of gold in domestic circulation as currency in 1933, the US dollar remained on the gold standard until 1971.   The international currency system was formalized by the Bretton Woods Conference in 1944.

When Nixon arbitrarily shut the 'gold window' in 1971 the world entered a reserve currency system of fiat dollars, restrained somewhat by the debt markets and floating exchange rates, often called Bretton Woods II.

The existing monetary system is still under development, even though we assume it is well established and settled because of the Pax Americana.

As these things go, its relatively short reign from 1971 does not guarantee its continuing longevity. The inherent instability introduced by having one nation essentially own the reserve currency, and subordinate to its own domestic policy requirements, has not been sufficiently resolved. Certainly not to the satisfaction to the rest of the world, even if it is a jealously guarded privilege.

Related:   The Continuing Endgame For Bretton Woods II and the Role of Gold
                 An Essay Considering the Current Monetary Order and Gold
                 Europe Finally Has an Excuse to Challenge the Dollar

Draining Physical Gold From Funds and Trusts To Supply the Markets of Asia - An Extreme In Speculation

Numbered — God has numbered your reign, and will end it.
Weighed — you are weighed on the scales, and found wanting.
Divided — your power will be divided up and given to others.

Daniel 5:25-28


“QE [quantitative easing] puts beer goggles on investors by creating a line of sight where everything looks good."

Peter Boockvar

It is interesting, but little noted, that during similar price declines, physical gold is removed from the funds and trusts, while silver remains almost untouched.

That is because the 'gold float' of physical gold available to supply the steadily aggressive demand is critically low, whereas silver, while also beaten down by speculators, sees no decline, because there is an adequate supply of physical silver, for now.

Compared to the physical delivery market of Shanghai, the NY Comex looks like a game of Liar's Poker, an exercise in pure speculation, almost like a bucket shop.

The number of 'claims per ounce' in gold has risen once again to 315 claims per ounce offered at these prices.

In the way that the Fed implements it, Quantitative Easing is like beer goggles for financial paper.

A purposely misaligned, an arbitrary valuation and mispricing of risk in any asset class, commodity or currency, can be sustained only by force and fraud. As the fraud becomes weaker and less effective, the force must increase.  Eventually the scheme breaks down, and a more market-based equilibrium will reassert its presence. That is monetary or value theory based on history. 

Gold is moving from West to East, and is unlikely to return anytime soon, and at anything near to these prices.

Our markets will have been weighed, and found wanting.